When BDT & MSD lost patience w/ Rudy G consigliere Bruce Teitelbaum, the race to find a new developer for what could be one of New York’s more consequential projects was on. BDT & MSD, which had a ≈ $165M note on the trapezoidal Long Island City site at 44-02 Vernon Blvd., tapped Newmark to run point on a UCC foreclosure auction, w/ an eye on taking the site over in a credit bid. Now, a couple of quiet heavyweights have set themselves up to develop it – w/ BDT & MSD’s help. 👇

We caught up with Aaron Krawitz of Bravo Capital, which has done $2B+ in CRE financings across several asset classes. Aaron’s team has built a rep for getting deals over the line, and a big part of that is being deep in the weeds of regulation and structure.

One fascinating space we touched upon was SNFs. Bravo is an active lender in that niche, and recently put out a must-read primer – The Silver Wave – on the growing investment gap in healthcare infrastructure. It's worth checking out in full here.

Sol Feder, a developer w/ ground-up chops in both LIC & Brooklyn, is teaming up w/ Jack Klein, an exec for the US arm of Israeli developer Azorim, The Promote understands. The partners want to build 200+ condos and 700+ rentals on the Opportunity Zone site in Phase I, per investor materials, and are looking to raise ≈$100M in LP equity. They’re in talks w/ BDT & MSD to kick in $200M+ in financing, per sources, and expect the all-in costs to run ≈ $800M.

Feder is a known quantity. He built the 158-unit 45-57 Davis in the same hood, and Downtown BK’s 286-unit 260 Gold St., on which he partnered w/ Joseph Brunner & Abe Mandel – that project eventually sold to a KKR/Dalan JV as part of a whopper portfolio trade. Azorim’s American adventures, meanwhile, have mostly been in the if-it-happened-there-did-it-really-happen market of Yonkers - you can see Klein w/ the mayor here. For a hot second in ‘17, it toyed w/ the idea of buying a piece of Brooklyn developer Brookland Capital, Boaz Gilad’s now-collapsed firm (see 💎 item 👇 ). In Israel though, Azorim is a major publicly traded player, and is controlled by Haredi Canadian billionaire and kosher 🍖 mogul Hershey Friedman, who bought a majority stake from embattled developer Shaya Boymelgreen (our snapshot of Shaya here) in ‘11. Klein is Hershey’s son-in-law (As co-host Krasne is fond of saying: “You can marry more money in a minute than you can make in a lifetime.”) 💍

Two law firms founded by Mark Nussbaum - the frum world’s Kevin Bacon & the protagonist in one of CRE’s largest-ever cases of escrow fraud – filed for Ch. 11 bankruptcy Thursday. The federal court maneuver (h/t Bloomberg) overrides the NY state court ABC bankruptcy alternative where the action was playing out thus far. The ABC is what gave us a series of jaw-dropping disclosures over these past few months, revealing a long-in-the-shadows dealmaking ecosystem and a cinematic level of chicanery. To recap:

Clients deposited ≈$380M into Nussbaum's IOLA account as "show capital” for deals run by Mendy Steiner. ≈ $330M of that money never found its way back; Steiner killed himself in Jan. ‘25. Major creditors include nursing-home player Jacob Sod and Lakewood lad Sheldon Zafir, who is allegedly owed a staggering $149M (per the ABC filings). The fallout saw Nussbaum shutter his firm, and eventually, get charged w/ grand larceny. The new Ch. 11 filing name-drops Murray Huberfeld, an edgy hedgie once convicted in a correction officers’ union bribery scheme (a Jona Rechnitz connection here), who is owed $17M. The biggest creditors flagged are Elizabeth Capital Success, at $156M, and Blueberry Funding, at $59M - that latter name, per sources, is tied to financier Abraham Miller. (Insiders: Full creditors list at end of this email 🔒)

See also:
The Double Schlimazel 🍲🍲
Fall of a Dealmacher 📺
Hush Money 🤫

This Thursday, April 23, The Promote will be hosting an in-depth chat w/ Lightstone Group founder David Lichtenstein, a consummate dealmaker. We’ll talk retail money, development, special sits, & a lot more – David is really in the mix. This virtual event is only for subscribers to The Promote Insider, so sign up for that and we’ll send you registration deets. (Insiders: See reg. link at end of this email 🔒 )

The latest Nussbaum update threw up a character that deserves his own spotlight – think of him as the Winston Wolf for underwater real estate machers. Nussbaum Lowinger’s new chief restructuring officer is a bloke called Ephraim Diamond, of Arbel Capital Advisors, who’s found himself in the thick of several headline-grabbing bankruptcy cases.

• Brookland Capital: The Boaz Gilad-led firm was one of the most prolific developers of Brooklyn condos in the mid-2010s, and a repeat fundraiser on the TASE. The 🎵 stopped in ‘19, though, w/ Brookland losing control of several projects and Gilad being pushed out amid bondholder pressure.
• All-Year Holdings: The fatty. No one made bigger deals in Brooklyn CRE than Yoel Goldman, and no one’s crash has been as spectacular and complex – unwinding the multibillion-dollar portfolio took years (here’s the restructuring closing dinner).
• Emerald Equity: Isaac Kassirer dined on NYC’s rent-stabilized stock with immense gusto, until it dined on him – he became one of the biggest casualties of the ‘19 NY rent reforms, and power players like Richard Mack (the pref) tried to catch the falling 🔪 .
• Pinnacle Group: Joel Wiener’s 5K+ 🚪 RS portfolio, crippled by $1.1B in debt from Flagstar Bank & Israeli bondholders, became a political battleground when Zohran Mamdani, in one of his first acts as NYC mayor, tried to block the bankruptcy sale of the portfolio to Zohar Levy’s Summit Properties (podded on it here.) Diamond specifically addressed the potential conflict of interest flagged in Summit’s bid, where Summit was found to have previous business dealings w/ Joel Wiener’s brother Jonathan. “It is my understanding that Jonathan Wiener does not hold any equity interest in any of the Debtors, does not hold or own any assets jointly with any of the Debtors, and does not manage any of the Debtors or their properties,” 💎 wrote, in a delicately worded rebuttal. Not everything worked: Early in the case, 💎 spent nearly 7 hours on the stand asking to use Flagstar's rent collateral, only to have the judge reject his theory as stretching the law "beyond any use of the statute known to this Court." When a deal was eventually cut, Flagstar extracted a co-CRO with joint sign-off on every call – the fixer got assigned a co-fixer. ( 💎 did, however, make it into the Traded post.)
• Nussbaum Lowinger 🎷: Diamond’s strategy here was to claim the ABC had made little progress, and that creditors were languishing. A Ch. 11 filing, he argued, would speed things up. But the ABC lawyer, Sheldon Eisenberger, alleges that “Mark Nussbaum caused the unauthorized filing” of the bankruptcy petitions, and vowed to contest them.

💎 was polished in Flatbush, a yeshivish kid (still carries a touch of the accent) who graduated Touro College and NYU Law. He cut his teeth at white-shoe firm Paul, Weiss before spending a decade at investment firm Davidson Kempner working on distressed deals/special sits. He launched Arbel in ‘18, and has built up quite a rep with the TASE-backed and frum crowd - he’s a Five Towns guy in w/ bankruptcy-sale pros like Northgate’s Greg Corbin 👨‍🦲 and PR mavens like Ushi Teitelbaum (that kid is everywhere). Here is 💎 to frum-focused Ami magazine: “On the creditor side, I learned to read the documents carefully. It’s kind of like, l’havdil, when you read a gemara or a Rishon, and you’re trying to be madayek, very exact.” 🎯 🙏 Diamond declined to comment for this story. A source familiar w/ his operation said he brings a level of sensitivity & understanding of the frum dealmaking world to bankruptcy conversations, which are by nature contentious.

The Nussbaum case is a bit of a twist for him – rather than a sponsor who flew too close to the sun, it’s the ultimate middleman now ablaze. But the need is the same – someone has to read the gemara carefully.