Sales  ·  Commercial

Flatiron Building Auction Date Set for May 23 After Botched Sale

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Nearly a month after the sale of the Flatiron Building was derailed by a real estate outsider who couldn’t pay up, a date for a second auction has been set, Commercial Observer has learned.

On May 23, the 121-year-old building will return to the court-ordered auction block for a price the current owners hope will be more easily reached, according to a source familiar with the arrangements. The auction will be held at the 60 Centre Street courthouse.

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This time, Jacob Garlick, who had the winning bid last month but never paid the deposit, will likely need to bring funds before he starts bidding — if he returns. The deposit will be required upfront, according to the source.

Garlick did not immediately respond to a request for comment.

Garlick registered as a bidder during the original auction on March 22 on the steps of the courthouse in Manhattan. He expressed absolute confidence that he would win to those around him, and then as the bidding process kicked off he continued to raise his paddle, going head to head with GFP Real Estate chairman Jeff Gural.

The price reached $190 million before Gural, who owns a stake in the New York City landmark, tapped out.

The other partners include Newmark (NMRK), Sorgente Group and ABS Partners Real Estate, who have been locked in a legal battle against the majority interest holder, Nathan Silverstein, who they said prevented the others from profiting off the investment. 

Silverstein could not be reached for comment.

After winning the auction, Garlick had two business days to deliver 10 percent of the $190 million, $19 million, to the court-appointed referee, attorney Peter Axelrod, but never delivered.

Gural and the partners had the choice of either accepting the building at $189.5 million or letting the building go back to auction. They exercised the latter option.

Mark Hallum can be reached at mhallum@commercialobserver.com.