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Sharif El-Gamal threatening to deconstruct condo tower, lender claims

Sharif El-Gamal built a 667-foot condo tower in Tribeca. Now he’s threatening to rip the top of it down, his lender says.

The developer is playing hardball, according to the lender, warning that if a foreclosure proceeds, he will make the project much less valuable.

The seeds of the strategy were sown in 2016 when El-Gamal, the head of Soho Properties, merged two zoning lots at the former so-called “Ground Zero mosque” site, where he planned to build a two-story Islamic cultural center and a 43-story condominium at 45 Park Place.

That allowed El-Gamal to use air rights from the proposed Islamic Museum of New York to build 45 Park Place roughly one-third taller than otherwise permitted, boosting its projected sellout to nearly $448 million.

But the project has suffered a series of setbacks, and its consortium of overseas lenders has cut off funding and is moving to foreclose. To stave off the action, El-Gamal is warning those air rights could disappear, the consortium says.

It’s a complicated maneuver. This February, attorneys for the entity that owns the cultural site wrote to the entity that owns the condo tower, threatening to undo the zoning-lot merger unless the lender releases the funds to complete the project. Both entities are controlled by El-Gamal, according to the lender, although the developer denies that.

The attorneys said the merger rollback would yank 40,000 square feet of rights from the nearly completed condo tower. That would render the most valuable 15 or so floors illegal.

The lending group fired back. In a letter asserting that both entities answer to El-Gamal, it accused him of orchestrating a “bad faith scheme” to “gain leverage in negotiations.”

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TRD