Los Angeles Times
October 14, 2021
A planned foreclosure auction of the largest modern home in the country has been delayed after billionaire lender Don Hankey was accused of maneuvering to take control of the troubled Bel-Air project and leave other debt holders out in the cold.
“The One,” a 105,000-square-foot unfinished mansion once marketed for $500 million, had been set to be sold to the highest bidder Wednesday. The auction was scheduled after developer Nile Niami’s limited liability company, Crestlloyd, defaulted on $106 million owed to Hankey’s real estate lending arm.
But a Los Angeles County Superior Court judge delayed the trustee’s sale until later this month after lender Joseph Englanoff alleged that Hankey reneged on an agreement to have the house completed and sold by real estate brokers, and instead was using the auction process to unfairly take ownership of the mansion or hog the proceeds if it is sold to a third party.
Englanoff, a Los Angeles-area physician and real estate investor who lent $30.2 million to Crestlloyd in 2018 through his Yogi Securities Holdings, states in legal filings that he is still owed $22 million.
Danning Gill Partner John Tedford who worked for a client involved in a dispute with Hankey in another foreclosure case, said he did not think Englanoff would prevail with the argument that Hankey’s entire debt is subordinate to Yogi. However, he said the additional loans were another issue.
“The junior lienholders probably have a good argument that their liens are senior to the new stuff,” said Tedford, who is not involved in the dispute involving The One.
Tedford also told the Los Angeles Times that foreclosure sales typically leave little to nothing for junior lienholders and one possibly requiring a cash bid of $100 million or more could be particularly challenging to draw high bidders.
“What sort of Brinks truck is going to pull up with a briefcase full of cashier’s checks for over one hundred million bucks?” he quipped.
To read the full article, click here: https://www.latimes.com/business/story/2021-10-13/the-one-mansion-auction-delayed