A Brooklyn courthouse is at the heart of a dispute that has landed David Bistricer’s Clipper Equity in a Brooklyn courthouse.
Clipper, a major Brooklyn property owner that has recently wound up on the city’s worst landlords list, has been hit with a foreclosure suit by lender Wells Fargo over a $100 million mortgage secured by the Downtown Brooklyn building 141 Livingston St.
The 15-story, 200,000-square-foot, postwar property at Smith Street has been completely leased for decades by the city, which has installed Kings County’s housing and small claims courts there.
The city’s lease expires in December, and officials from the city’s Department of Citywide Administrative Services have apparently offered to extend it by two years, according to the suit, which was filed Friday in a Brooklyn courthouse at a different address, the state Supreme Court building at nearby 360 Adams St.
But Wells Fargo claims two years is too short and puts its loan in financial jeopardy. The lender’s suit goes on to claim that Bistricer must put hundreds of thousands of dollars a month into a special account as a sort of insurance policy against the single-tenant building soon becoming vacant, the filing says.
Specifically Bistricer, the firm’s founder, was allegedly required under the loan’s original terms to start depositing $556,000 a month beginning in June 2024 to protect against the city’s pulling out of the address. But the developer has not made any of those payments, according to Wells Fargo, which also claims that the Bistricer has not been able to prove his net worth is at least $100 million, another stipulation of the mortgage.
For his part, Bistricer has yet to file an official legal challenge. But he has disputed some of the suit’s claims, according to documents on file with the court.
Indeed, the two-year span cited by the city’s Department of Citywide Administrative Services should be seen as just a possibility; in actuality, city agencies almost always stay on for a full five years or more, according to a letter submitted by Bistricer attorney Robert Ivanhoe of the firm Greenberg Traurig.
Ivanhoe, who says he has worked on many leases in landlord deals with city agencies through the years, added that if the courts do indeed stay on at 141 Livingston through 2030, no protective deposits should be due at this point.
Bistricer appears to have purchased the 1959 structure in 2002 for $14.5 million, based on the city register. The disputed loan was originally issued by Citibank in 2021 and assigned to Wells Fargo the same year, according to the register. The city pays about $45 per square foot annually for space at the building, which is completely occupied by the two courts, CoStar data shows.
A firm known for conversion projects, Clipper Equity also previously teamed with Joseph Chetrit’s The Chetrit Group in 2011 to buy the Chelsea hotel for $80 million, though they unloaded the historic West 23rd Street site two years later after failing to turn it into a condo.
Clipper Equity and Bistricer ended up on the public advocate’s “worst landlords” list in 2022 over the allegedly high amount of violations at some properties.
A phone message left for Bistricer at his Brooklyn office was not returned by press time. And Gary Eisenberg, the lawyer with Perkins Coie who filed the suit for Wells Fargo, also did not respond by press time.
