Grubb & Ellis Seeks To Hand BGC Control Of Commissions
Lawyers for Grubb & Ellis filed a response this afternoon to the hundreds of objections from brokers at the firm in recent days, insisting that the bankrupt real estate services company doesn’t owe them millions of dollars in commissions.
The answer comes a day before a scheduled hearing in bankruptcy court in which the sale of Grubb & Ellis to BGC Partners, its senior creditor, is expected to be approved. Questions have lingered whether brokers will be paid commissions they are owed.
Brokers at Grubb & Ellis have voiced several arguments in the fight over their commission dollars. But in documents filed by Kasowitz, Benson, Torres & Friedman LLP, the law firm representing Grubb & Ellis in the bankruptcy, the firm insisted that Grubb & Ellis and BGC ought to receive the money and that brokers have no right to it.
“Pursuant to the APA (amended purchase agreement), the Purchaser (BGC) is acquiring, among other things, all of the Debtors’ receivables “free and clear”,” the documents stated.
Even commissions that are owed for deals that have closed after the February 20th bankruptcy filing date, a threshold that was thought to offer brokers a better shot at recouping their money, should be kept by BGC the documents said in what is likely to be a heated point of contention at tomorrow’s hearing.
“Courts have routinely held that consideration for a broker’s real estate commission is rendered when the broker or its agents procures a buyer/tenant, even though a right to payment may not arise until post-petition,” Kasowitz’s papers read.
Kasowitz said that it should be up to BGC to collect commissions and doll out money as it sees fit.
“BGC has stated its intention in open court on several occasions that Agents who accept employment with BGC will be paid the commissions they are owed by the Debtors whether such commissions relate to transactions which closed prior to or after the Petition Date,” the filing read. “BGC is not willing, however, to satisfy the Debtors’ obligations to Agents who are no longer employed by the Debtors and are not willing to commit to remain with BGC following the closing of the Sale.”