Flatiron Building owners sue auction winner over down payment

Real Estate

By Hannah Frishberg

May 9, 2023 | 5:47pm

New York’s hottest real estate story just got spicier.

The Flatiron Building’s current deed-holders are now suing its would-be new owner several months after he bid a still-unpaid $190 million at auction for the iconic Fifth Avenue property.

Plaintiffs, including some of the triangle-shaped icon’s current owners, are taking Abraham Trust to court over allegations that Jacob Garlick, a managing partner at that firm, won ownership but has yet to put forth a penny towards its down payment, Crain’s first reported.

“Defendants’ failure to pay the down payment and move forward with the purchase of the Flatiron Building was contrary to the multiple representations they made by participating in the auction,” reads the suit, according to the outlet.

The debacle was a “fraudulent bid” to get the small trust “15 minutes of fame,” the suit also charges. 

The Post has reached out to Abraham Trust for comment.

The filing also alleges that Abraham Trust invested significantly in marketing and other materials, including a list of multimillion-dollar properties, to bolster its position as a genuine contender for the terracotta skyscraper — and not just an aspiring amateur. 

The 31-year-old Garlick came out of nowhere to win the court-ordered March auction with the enormous bid, sending the New York real estate world into a tizzy, which only became more wild after the apparently deep-pocketed newcomer failed to pay a $19 million deposit shortly thereafter, according to reports. 

Despite not appearing to be able to afford the price he put on the 121-year-old edifice’s head, Garlick reportedly still tried to retain the property, which was up for auction in the first place because its multiple owners faced a very expensive ongoing impasse. 

Meanwhile, the property is now also among the city landmarks being considered as potential shelters for the busloads of migrants arriving daily in the city. Struggling to locate living spaces for them, City Hall officials are looking to structures including JFK Airport hangars and Aqueduct Racetrack.

Sale-wise, however, as the drama heads to court, the Flatiron is heading back to the auction block on May 23, according to Crain’s.

Due to the mayhem following the last auction, participants at the second one are required to have a check for $100,000 and proof of further funds for their bids to be taken seriously.