Bauhouse Files For Bankruptcy To Protect Sutton Place Investment
Bauhouse Group has filed for bankruptcy in a bid to keep its troubled Sutton Place project afloat after a series of recent setbacks.
Bauhouse, owned by Joseph Beninati, had previously sought an injunction in the State Supreme Court against foreclosure by lender Gamma Real Estate, but the request was denied last week. Bauhouse alleged Gamma had improperly dissuaded lenders from bidding in an attempt to grab the property itself.
It was not immediately clear whether the foreclosure auction, scheduled for 11am Monday, went through as previously planned or not.
The Chapter 11 filing could buy time for Bauhouse—which owes $3.5M to at least 20 other firms including JLL, Tishman Construction and Douglas Elliman, besides the $147M it owes Gamma. However, Crain’s reports the move could also expose Beninati and his co-executive Herman Carlinsky to personal liability for some loans, depending on their exact terms.
Bauhouse defaulted on its loan from Gamma in January, and last week JLL sued the firm over allegedly failing to pay $2M in commissions owed for arranging the loan with Gamma last year. [Crain’s]