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Old folks stuck in Prospect Park Residence while owner, buyer evade settlement

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They’re not buying it.

The outgoing residents of a tony Park Slope old folks’ home say they’re skeptical of a real-estate investment firm’s promise to pay them the $3.35 million they agreed to take in exchange for vacating the ritzy property, which their landlord failed to cough up when it was due last month.

Sugar Hill Capital Partners claims it is willing to front the cash Prospect Park Residence owner Haysha Deitsch agreed to pay his frail tenants so they can afford to move to a new nursing home, yet just last week the firm got a court order to stop Deitsch from using its money for that very purpose. Now the tenants and their loved ones say they don’t believe either party is good for the greenbacks.

“I don’t know whether they really mean it,” said Nancy Richardson, whose 93-year-old friend AnneMarie Mogil lives in the Prospect Park West home.

Deitsch claims he intended to pay off the residents — who fought a high-profile court battle to stay in the building for two years before finally agreeing in June to leave for the handsome sum — using a security deposit Sugar Hill put down in 2014 to nab the ritzy 134-unit building and turn it into condos.

But Sugar Hill just obtained a court order preventing him from dipping into the down payment, accusing him of crying poverty to secretly spend their cash behind their backs.

“Rather than respond to good-faith efforts to reach resolution, the seller is refusing to negotiate, threatening bankruptcy, and seeking to wrongfully retain Sugar Hill’s down payment for its own benefit,” the firm said in a statement.

Sugar Hill claims it is still prepared to fund the settlement itself so it can finally take control of the building and turn it into condos, but refused to say how, when, or why it won’t just allow Deitsch to use the deposit, declining to comment further.

In the meantime, the frail residents say they’re stuck in the middle — they’ve already put down deposits on new nursing homes, but can’t afford to leave until someone coughs up the cash.

“We’re screwed at the moment,” said Richardson. “[Mogil] could move in there tomorrow, but not unless that money comes through.”

The residents’ loved ones are also worried Deitsch is still shopping around for another buyer willing to pay more than the $76.5 million he agreed to sell it to Sugar Hill for two years ago. They claim they’ve seen him leading parties of well-dressed professionals through the building.

“We’ve seen him bringing through groups of people, 15 people at a time, and walking through the building starting with the roof,” said Richardson. “Why is he doing this? And he’s been doing it for months.”

But Deitsch’s attorney said that if his client is trying to pull the rug out from Sugar Hill, nobody told him about it.

“I am not aware of him showing the building to other buyers,” said lawyer Joel Drucker. “The parties right now are Sugar Hill and Deitsch, and are close to a settlement.”

The residents’ lawyer is now trying to place a $3.35-million lien on some other properties Deitsch owns on Fourth Avenue.

Prospect Park Residence itself already has $10 million in liens tied to wrongful death suits he is in the midst of fighting, so the attorney hopes an attachment order on his other investments will light a fire under Deitsch’s butt.

“At this point, putting a lien on 1 Prospect Park West doesn’t really put any pressure on him,” said attorney Fred Millet. “We wanted to come up with something outside the box.”

Reach reporter Colin Mixson at cmixson@cnglocal.com or by calling (718) 260-4505.
Updated 6:14 am, August 11, 2016
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Reasonable discourse

Sean F from Bensonhurst says:
To paraphrase the NY Security Deposit laws: The security deposit must be stored at a banking institution that has a location within the state of New York. The deposit must not be commingled with any personal money of the landlord and the landlord must not attempt to use the money from the security deposit as if it is his or her own.

So, Deitsch can't legally use Sugar Hill's security deposit for any purpose other than its originally intended purpose.
Aug. 12, 2016, 1:22 pm
Sabine from Park Slope says:
Why don't the warring parties here get help from the Mayor? He knows his way around these nursing home deeds: Look how he expedited 45 Rivington. PPR should be just as easy to clear up.
Aug. 13, 2016, 8:52 pm
Cinque from In the perimeter says:
A real estate developer broke a promise?

I'm just knocked over by that one
Aug. 14, 2016, 2:55 am

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