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October 19, 2019Cart

Business

by Westchester County Business Journal
by WCBJ

Broker claims seller didn’t pay $260,000 Oakwood Gardens commission

Mordel Real Estate Advisors claims that the seller of an affordable housing midrise in Mount Vernon has refused to pay a $260,000 brokerage fee.

Mordel, of Great Neck, Nassau County, sued Mt. V LLC, April 1 in Westchester Supreme Court claiming that it had procured “a ready, willing and able buyer” for $13 million.

The transaction was for Oakwood Gardens Apartments at 630 E. Lincoln Ave., near the Pelham border. The 89-year-old, 100-unit Tudor-style structure provides subsidized housing through the federal Section 8 program.

Mordel says it contacted Mt. V in 2017 about a potential buyer, K&R Preservation of  Manhattan.

Mt. V is a special purpose entity managed by real estate attorney Aaron Seligson of Seligson, Rothman & Rothman in Manhattan.

K&R Preservation’s founders, Francine Kellman and Brian Raddock, specialize in buying and renovating affordable housing properties that are deteriorating or close to financial default.

Mordel claims it negotiated a deal in which K&R Preservation would pay Mt. V $13 million, for a 2.5 percent commission. The commission was later reduced to 2 percent, or $260,000.

Mordel also claims that it saved Mt. V $800,000 on its mortgage “and otherwise acted as a catalyst for the sale of the property to K&R.”

The contract of sale acknowledged Mordel’s brokerage services, the complaint states, and Mt. V’s obligation to pay the brokerage commission.

The deal closed on Feb. 26 but Mt. V, according to the complaint, has refused to pay the commission.

The lawsuit charges Mt. V with breach of contract and unjust enrichment.

Seligson was not available to respond to the allegations, and associate Stewart Rothman did not immediately respond to a voicemail message.

K&R has budgeted $20.6 million for the acquisition, according to a Mount Vernon Industrial Development Agency document, including renovations on the 2.25-acre property.

Mordel is represented by attorney Martin Eisenberg of White Plains.