Boaz Gilad Resigns From Brookland After Being Edged Out by Bondholders [Updated]
Brookland, a prolific developer in Brooklyn, announced in November 2018 that it could no longer meet its debt obligations to Israeli bondholders due to liquidity issues, and stalled trading on its bonds in Tel Aviv. The company then entered into negotiations with bondholders over the $40 million it still owes.
Last week, the bondholders compelled Brookland to pass the reigns of Brookland Upreal, the company that issues debt in Israel, from Gilad to a special administrator. While Gilad himself opposed the move, the three other directors of the company approved it. Ronel Ben-Dov, a New Jersey-based landlord, was appointed to the position but has not yet been confirmed. Once appointed, he will have full control over the company’s accounts and all transactions will need his approval.
“As part of my disagreement with the bondholders, I quit as the chair of Brookland Upreal LTD,” Gilad told the Commercial Observer. “They tried to force a manager on me, and out of my commitment to my employees and my investors I said I can’t do that.”
In a statement regarding the resignation, Gilad said it was due to bondholders’ aggressive demands, and that the appointment of Ben-Dov was done without his consent, in a way that would harm both him and the company, according to documents filed on the Tel Aviv Stock Exchange.
Gilad is still the owner of Brookland’s many properties—the company has dozens projects under development in Brooklyn—and the guarantor to many of its loans.
The company once again stalled trading on its two bond series, which were selling for 26 and 15 cents each.
Updated: This story was updated to reflect that Gilad resigned from Brookland Upreal, a subsidiary of Brookland Capital, and not from Brookland Capital.