Real Estate 101

Hard Knocks for a Brooklyn Alternative School

Meanwhile, Lucerna and Garden Acosta waited. In June 1997, Garden Acosta was able to get a sit-down with Muschel. Part of his concern was that Muschel, a Hasidic Jew, had decided not to sell the property to El Puente because of the long-term tensions over turf between Hispanics and Hasidim in Williamsburg. "I attempted to lay out who we were, what our plans were," recalled Garden Acosta. "But he was very agitated. He said, 'I have seen all the publicity and I know who you are. I know Krinsky will make a lot of money. He will never get the building and you will not get it.' "

Muschel, however, did suggest a figure, Garden Acosta said. It was $3 million, double the amount of his original contract with Krinsky. "He was clearly saying under no circumstances would he comply with the contract," said Garden Acosta.

Nor did he. Muschel died in January, 2001, leaving the property, and its attendant litigation, to his three sons. In March, just days before the matter was to come to trial, the Muschels paid Krinsky $500,000 to drop his claims—a tidy profit for a man who had never even owned the building. It also had the effect of leaving El Puente high and dry. Using a team of pro bono attorneys from a prominent Manhattan real estate firm, KMZ and Rosenman, El Puente brought its pleas before Judge Dowd.

Held Up: (From left) Luis Garden Acosta, Gino Maldonado, and Frank Negron of El Puente thought they had a deal to turn this building into a new high school. Then the owner decided to "maximize" his profit.
photo: Shulamit
Held Up: (From left) Luis Garden Acosta, Gino Maldonado, and Frank Negron of El Puente thought they had a deal to turn this building into a new high school. Then the owner decided to "maximize" his profit.

Garden Acosta took the stand to testify about his dealings with the late owner but said he was blocked from doing so when Judge Dowd upheld objections by the Muschels' attorney. "They wouldn't allow me to testify about anything," said Garden Acosta. "I couldn't say that we had a meeting with the owner before he died; that he told us we would never get the building."

One of Garden Acosta's attorneys, Gerald Rosenberg, said Dowd's ruling will be appealed. "The court was extremely limiting in its evidentiary rulings," he said.

But a lawyer for the Muschels, Andrew Miltenberg, said his client's actions were reasonable and legal. "We considered the original contract dead," he said. There was no problem with El Puente itself, Miltenberg said, just their price. "[The Muschels] believe it may be worth $4 million to $5 million now," he said. "Were El Puente to come now and make a commercially reasonable offer to lease and buy the building I am sure [the owners] would be receptive."

There ends the lesson.

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