Former HFZ Exec Nir Meir Indicted in $86M Fraud Case
By Abigail Nehring February 7, 2024 5:15 pm
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Developer Nir Meir was indicted with five other real estate executives for allegedly stealing at least $86 million in a years-long fraud scheme, Manhattan District Attorney Alvin Bragg announced Wednesday afternoon.
HFZ Capital Group and construction firm Omnibuild allegedly swindled investors, contractors and city tax collectors during Meir’s five-year stint as second-in-command at HFZ, according to the DA’s office. The case largely centers on the construction of the $2 billion The XI condominium development in Chelsea, where prosecutors claim Meir masterminded a scheme to funnel $254 million from the project into other accounts, dooming it to failure and causing financial chaos at HFZ over four years.
Meir, HFZ head of construction Athony Marrone and project manager Louis Della-Peruta were indicted on Wednesday, along with Omnibuild Co-CEO John Mingione, project manager Roy Galifi and accountant Kevin Stewart.
The executives, along with HFZ and Omnibuild, were indicted Wednesday on a range of charges including larceny, conspiracy, falsifying business records, tax fraud and money laundering, according to prosecutors.
Meir was arrested in Florida Tuesday and is awaiting extradition to New York, a spokesperson for the Manhattan district attorney’s office said.
“These indictments depict allegations of widespread fraud within the real estate industry primarily spearheaded by one man: Nir Meir,” Bragg said in a statement. “My office’s Rackets Bureau is laser-focused on fraud in the construction and real estate industries and will continue to root out people who steal from investors and corrupt the market.”
Omnibuild spokesperson Josh Vlasto said in a statement that the construction firm was innocent and also a victim of HFZ.
“The evidence will show that HFZ stole from Omnibuild as it did from many others,” Vlasto said. “We absolutely maintain our innocence and look forward to continuing to work with the DA to bring about this result as quickly as possible.”
HFZ, which was run at the time by Meir and founder Ziel Feldman, bought 76 11th Avenue in 2015 for $870 million and hired Omnibuild to build two mixed-used residential towers on the site. Meir pitched investors on his vision for a luxury development with 236 condo units overlooking the Hudson River.
Instead, as HFZ faced financial troubles, prosecutors claim Meir funneled hundreds of millions in The XI’s construction funds to bank accounts controlled by HFZ executives to make up for shortfalls in other HFZ projects, prosecutors said.
HFZ tried to put the money back into The XI project — which stopped work in 2019 — but it ultimately had a $37 million gap, court documents said.
To cover its tracks, HFZ and Omnibuild asked subcontractors to lie on invoices to show lenders that work was continuing at a rapid pace. Investors eventually learned of HFZ’s financial disarray and took over The XI project in 2020. (The Witkoff Group and Access Industries got control of the project in 2022 and it was nearing completion in the fall of 2023.)
Meir resigned from HFZ and moved to Miami in 2020, and his legal troubles were just beginning. He’s currently fighting lawsuits from several former business partners, including Feldman, who blamed HFZ’s woes on Meir. Meir also filed for bankruptcy in Florida last week claiming he only has $50 to his name.
While not related to Wednesday’s indictment, this isn’t the first time law enforcement has been interested in The XI project.
John Simonlacaj, a former managing director for HFZ, was arrested in 2019 after he took bribes from a mob-owned construction company to inflate costs at HFZ projects, including The XI. Simonlacaj pleaded guilty to filing a false tax return and was sentenced to four months behind bars in 2021.
Feldman previously told Commercial Observer he was unaware of Simonlacaj’s crimes and immediately fired him afterward.
Stewart, Galifi, Marrone and Mingione were arraigned on Wednesday and all pleaded not guilty. Mingione was released on a $500,000 bond, Marrone on a $300,000 bond, Galifi on a $100,000 bond and Steward had no bail set.
Della-Peruta will surrender on Thursday, according to the DA.
HFZ’s lawyer, Charles Clayman, and Omnibuild’s lawyer, Marc Agnifilo, did not immediately respond to requests for comment.
Abigail Nehring can be reached at anehring@commercialobserver.com.
