The owner of embattled Park Slope old folks’ home Prospect Park Residence failed to pay his elderly tenants $3.1 million he owes them as part of a lawsuit settlement.
Landlord Haysha Deistch in June agreed to pay a handful of seniors $3.35 million to leave the tony Grand Army Plaza building he has been trying to boot them out of for two years — but, as first reported by the Post, he didn’t cough up the cash by his July 15 deadline, screwing residents who have already put down deposits on new places to live, according to their loved ones.
“It’s a bad situation, because what are we supposed to do?” said Nancy Richardson, whose 93-year-old pal AnneMarie Mogil lives in the home. “You’re counting on getting that money and all of sudden, as he’s done before, he comes up with some reason why he can’t do it.”
Deitsch has been trying to empty the building and sell it to investment firm Sugar Hill Capital Partners since 2014, but the transaction was put on ice after a few nonagenarian residents refused to leave and sued to stay instead — kicking off a long and high-profile lawsuit that became mired in sideshow battles over accusations that he was trying to force the holdouts to leave by serving them moldy food, raising their rent, and cutting central air conditioning in summer.
Under the terms of the settlement, the oldsters were supposed to leave by Aug. 31, but only if Deitsch paid them the handsome sum so they could find somewhere appropriate to relocate. He met earlier payments totalling $250,000, but missed the big payout on Friday.
Deitsch was planning to cover the costs with part of a $7-million security deposit that Sugar Hill put down to secure the $76-million sale of the property once all the tenants were gone, according to his attorney Joel Drucker.
But about a week before the money was due, the company — which had no role or responsibility in the settlement — refused to let him use its cash to make the payment, Drucker said.
Now, he claims, his client is in a catch 22.
“They want them all out before they’ll close and we can’t get them out until they let us use their money,” said Drucker.
Sugar Hill said it does still want to buy the property, and it is “working diligently” towards finding a mutually agreeable solution for all parties, but would not expand on how or what that might look like.
Meanwhile, Deitsch has also defaulted on the $33.4 million mortgage he took out to buy the building in 2006, and is now facing foreclosure on the property, which he plans to contest in court.
But Deitsch, the son-in-law of high-profile developer Shaya Boymelgreen, owns other properties, including several he bought on Fourth Avenue for $10 million last year with the intention of erecting luxury apartments.
The residents’ attorneys may be able to place liens on that land to secure their clients’ cash, one of the residents’ attorneys told DNA Info. But one of their other lawyers said he is worried the landlord may be able to avoid paying by declaring bankruptcy.
“I’m not really confident about anything, this case has been such a cluster,” said Fred Millet. “We’re going to do everything we can for our clients to get this money, but if Haysha decides to file bankruptcy, I don’t know what we can do at that point.”