Hudson Yards Project Stalls As Partnership Goes Sour

March 4, 2015 — Kuafu Properties, a Chinese private equity firm with an office in New York, plans to build a 47-story condo and hotel tower near Hudson Yards — if a judge rules in its favor and boots the development giant's local partners from the deal. According to the Daily News, Kuafu wants a judge to force local players Blackhouse Development and Siras Development to turn over their stakes in the project. If not, Kuafu will sell the land to the highest bidder and the tower may never see the light of day. Kuafu told the Daily News that Blackhouse and Siras "keep going behind its back to make decisions about the property, at 38th St. and Eleventh Avenue, despite the fact that their operating agreement dictates that every decision requires the vote of Kuafu's executives. Siras went behind its back to tap brokerage Compass to market the condo units, while Blackhouse keeps talking about the project to the press without the permission of all the partners." Spokespersons for Blackhouse and Siras did not immediately respond to the newspaper's requests for comment. The companies bought the development site last year for $115 million and "were planning a 380,000-square-foot mixed-use tower with 50 condo units, a 400-room hotel and high-end retail on the ground floors." With work on the tower now stalled, it seems like a waste of time, resources, and money. But Kuafu guesstimates the sellout of the project at $600 million — a nice jump from what the three companies paid. And let's face it. In New York, if these guys don't finish building that tower, whoever buys it probably will. Who says there isn't good drama in New York real estate?

Image source: Kaufu Properties