NYC’s Flatiron building went up for auction on Wednesday, March 22 due to continuous disagreements between the previous owners of the building. But after the winning bidder, Jacob Garlick from Abraham Trust, was unable to pay the 10% down payment, it was put back up for auction on Tuesday, May 23.
Prior owners of the landmark included: Sorgente Group, Jeffrey Gural’s GFP Real Estate, ABS Real Estate Partners, and Nathan Silverstein.
In January 2021, Sorgente Group, Jeffrey Gural’s GFP Real Estate and ABS Real Estate Partners (who have 75% ownership of the building) sued Nathan Silverstein (who owns 25%) due to discord between the landlords, reports The Real Deal.
Since the Flatiron Building was under shared ownership, all owners had the right to veto any major decisions in regards to the property. A filing showed that this led to an expensive stalemate between Silverstein and the other stakeholders.
“We have tried for years to work out these differences with Mr. Silverstein, but the defendant has delayed, resisted and ultimately refused to agree with plaintiffs’ proposed business plan,” said Gural in an affidavit.
Following the legal battle, a New York State judge granted approval for the original partition sale in March. The official public auction held by Matthew D. Mannion of Mannion Auctions started at an asking price of $40 million, according to YIMBY. The building was sold within around the first 45 minutes for $190 to Jacob Garlick, reported The Real Deal.
But since Garlick failed to pay up, Jeffrey Gural was able to buy back the landmark building for $161 million. According to Spectrum News NY1, Gural has plans to turn the building into apartments.
“I know that there are enough residential tenants that would want an apartment in the Flatiron,” Gural said. “There’s probably enough commercial tenants that would want an office there, but residential is easier.”
Apparently, Gural is suing Garlick for the $19 million he failed to pay for the down payment as damages, reports Spectrum News NY1.
For a little history lesson, the Flatiron building was built in 1902 by Chicago architect, Daniel Burnham. It’s construction was purposed for being home to new George A. Fuller Company offices, a Chicago contracting firm, explains History.com. The entire building spans 21 floors.
It was previously occupied by MacMillan Publishers, until the company announced their plans in 2017 to move out in two years. Though the owners finally agreed upon renovating the more than a century-old building after MacMillan Publishers left, the building still remains vacant today.