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Two of the most prominent developers in New York City are locked in a legal fight over millions of dollars related to the construction of a skyline-redefining tower in Downtown Brooklyn.
The Chetrit Group claims that the developer of Brooklyn Tower, JDS Development, owes it $17M, according to a new lawsuit. Joseph Chetrit alleged in court documents that JDS founder Michael Stern failed to pay him all he was owed after JDS bought out Chetrit’s stake in the development at 9 DeKalb Ave., Crain’s New York Business reports.
The two developers partnered to purchase the site on DeKalb Avenue near Fulton Street and Flatbush Avenue for $90M in 2015, with JDS taking the lead on the development. The building reached its final 93-story height in November 2021, making it Brooklyn’s first supertall skyscraper.
But the developers had been feuding long before the building’s completion. Chetrit claims JDS agreed to a buyout in 2018, paying for part of the stake with a $20M promissory note personally guaranteed by Stern. Court documents show the buyout was finalized in April 2019, with the condition that Stern would pay Chetrit an extra $1.5M if the note wasn’t paid off by April 22, 2020.
As of last month, Stern owed Chetrit a total of $24.4M, according to the suit. Stern paid off $10M in January, but the lawsuit alleges he still owes $14.4M, plus approximately $8K interest accruing every day, per documents submitted to the court. JDS’ total bill, according to Chetrit, comes to more than $17M.
Chetrit asked for a summary judgment, and JDS disputes the allegations, Crain's reports.
The Chetrit Group, owned by four brothers, initially focused on investing in NYC’s outer boroughs but now owns landmarks in Manhattan’s Financial District, including the American Express building and 1 Whitehall St. JDS was founded in 2002 by Stern, specializing in hospitality, mixed-use and luxury residential projects, and has over 7M SF of property under development.
JDS’ portfolio also includes controversies, such as at the Billionaire's Row supertall 111 West 57th St., which was completed in 2019 following construction delays, lawsuits and foreclosure proceedings.
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