A Manhattan real estate broker claims she is being denied more than a quarter-million dollars in commission from the $20 million sale of a building for the Abraham Joshua Heschel School, according to a suit she filed recently in Manhattan Supreme Court.
Although the Upper West Side academy is not named in the $1.2 million suit, an apparent agreement to shield the seller, developer Harry Macklowe, from commission and court costs could end up costing the school millions, just as it is about to launch an extensive capital campaign to fund a new high school.
The 17-year-old, nondenominational Heschel School, which currently serves students from nursery through eighth grade, closed the deal on two West End Avenue parcels between West 60th and 61st streets for its expansion on Jan. 31.
Shortly after, Debrah Lee Charatan, who said she spent more than a year closing the deal, was offered half the customary commission of 3 percent, or $300,000, instead of $600,000, by a Heschel School board member, she claims.
"I worked very hard for them," she said. "They were very specific about what they wanted. It had to be on the West Side, from the 60s to 90s, either an old synagogue or a church, 100,000 to 175,000 square feet. I worked for a year on this, and it kept me from doing other things to make money."
Commissions are generally the responsibility of the seller, but Charatan said because Macklowe had a competing offer from another developer who used no broker, school representatives agreed to absorb any commission costs to keep their offer on an equal footing.
Charging breach of contract, Charatan, 43, is seeking 6 percent of the sale, or $1.2 million. Her attorneys say the school would be responsible for the award, as well as court costs, if she prevails.
Howard Rubenstein, a spokesman for the Heschel School, declined to comment.School officials are said to feel they are the innocent victims of a squabble going on around them and in which they are not directly involved.
Macklowe in a phone interview denied that Charatan had brokered the deal, but he declined to say who had.
"Clearly there is a dispute and a misunderstanding regarding a request to be a broker in a transaction she didn’t have anything to do with," he said. "A court will have a chance to look at it to decide if the claim has any merit."
For Charatan, who has been a broker for 26 years and began as a secretary to developer Martin Raynes, the sale was among the largest she has closed.
"This was very important to me," she said, recalling that she had presented "between five and 10" other properties to the board members from December 1998 to January 1999 before locating the two parcels at 20-34 West End Ave. One building is the former site of the McBurney prep school. The other contains an auto repair facility, which would be razed to expand the school building.
"We knew this was perfect," said Charatan, a Borough Park native whose previous sales included the Puck Building in Soho, which she sold for $20 million to Charles Kushner of New Jersey.
But standing in the way of the Heschel deal were junior high school classes being held in the building under a lease with the city Board of Education. It took several months to obtain a written agreement that the city would vacate the property after the sale.
Charatan said she not only brokered the original deal for $18 million but a second re-negotiation when developer Albert Ginsberg, who owns adjacent land on the block, offered $20 million, forcing the Heschel School to match his offer.
She said she worked closely with Ron Sommer, a Heschel School board member, and two wealthy benefactors of the school, Michael Steinhardt and Leonard Stern, who Charatan said put up much of the money for the purchase.
Charatan said she had been willing to accept $500,000 and donate about 10 percent of that fee back to the school. She conceded that the remaining $150,000 at issue could easily be spent in legal fees.
"It’s the principle," she said.
Steinhardt, an investment banker and founder of the Partnership for Jewish Life and other philanthropic projects, declined to discuss the lawsuit. "I’m sorry she’s upset but I have no comment," he said.
Stern, president of Hartz Mountain Industries, the real estate and pet care products conglomerate, and also a major philanthropist, said he "understands both positions, but I think Harry is legally correct." Asked if the school had agreed to indemnify Macklowe from the commission, Stern said he had "no further comment."
Charatan quotes Stern, however, as having said that since he was involved in details of the sale and served as a "co-broker," she was entitled to only half the commission.
A former real estate developer, Mike Rosen, who said he referred Charatan’s services to the Heschel School, described the treatment she received as "flabbergasting," and claimed the parties tried to exclude her from the deal.
Rosen asserts Charatan was instrumental in the sale.
"She found it … and the school would not know about the site except through her," he said.