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Tri-State
Insult to injury: Kushner dinged $15M after losing $186M deal
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Kushner settles failed apartment deal for $17M
Settlement with NJ REIT comes four years after $186M deal went sour
Kushner Companies’ saga with the First Real Estate Investment Trust of New Jersey over a botched deal may finally be coming to an end.
The New York-based real estate firm reached a settlement with FREIT, agreeing to pay the New Jersey-based REIT $16.9 million in a deal announced yesterday. Though it appears Kushner gained nothing from the agreement – a representative for Kushner could not immediately be reached for comment – the settlement closes the door on a chapter that’s dragged on for four years.
The trouble started in January 2020, shortly after Kushner agreed to pay FREIT $186 million for six apartment properties in northern New Jersey and the Hudson Valley. Kushner put up a $15 million deposit. Then the pandemic hit.
Kushner had been set to inspect the units before the deal closed, but was unable to as New York and New Jersey declared states of emergency, which kept FREIT from making the properties available for inspection. When Kushner requested more time to look them over, FREIT considered the contract breached and canceled the deal, holding on to Kushner’s $15 million deposit in escrow.
Kushner then sued for breach of contract and was initially awarded the return of its $15 million deposit in 2022. The same year, it filed to recoup its legal fees, and FREIT did the same.
That’s where things started to go bad for Kushner. After two years of back and forth between the two parties, FREIT came out on top.
In May, an appellate court reversed Kushner’s $15 million deposit win and made the real estate firm responsible for FREIT’s legal fees.
This month’s $16.9 settlement includes the $15 million deposit as well as an additional $1.9 million, which may cover some of the company’s legal fees.
A representative from FREIT would not comment on the subject.
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