Sony music chief Tommy Mottola recently signed a contract to buy a duplex penthouse on East 85th Street that listed at $15.9 million.
But the apartment’s current occupant won’t be seeing a penny of that money anytime soon, if Manhattan District Attorney Robert Morgenthau has his way.
The five-bedroom condo is home to Tyco International’s ex–chief financial officer, Mark Swartz, the man who the government claims conspired with Tyco’s ex–chief executive Dennis Kozlowski to fleece the company for over $600 million. The Manhattan D.A.’s office has indicted Mr. Swartz and frozen all his assets; this means that while he’s allowed to liquidate the apartment, he can’t pocket the proceeds.
“We’re aware that a sale is in the works,” said Barbara Thompson, a spokeswoman for the D.A.’s office. “There is a freeze order in effect, and if the apartment is sold, we’ll seek to freeze those assets.”
Not that this matters much to Mr. Mottola, who is breathing easy now that both of his sisters-in-law are out of harm’s way. Over the weekend, kidnappers released Ernestina Sodi-sister to Latin pop star Thalia Zapata, Mr. Mottola’s wife-more than a month after she and her sister, Laura Zapata, were kidnapped in Mexico City. Laura Zapata was released on Oct. 10, apparently as a show of good faith, and it appears Ms. Sodi was released after the family paid a $1 million ransom. The police never intervened in the drama because the family did not report the kidnapping; Mexican authorities said they respected the family’s wish to handle the situation themselves.
If the government wants to freeze the near-$16 million that Mr. Mottola is paying Mr. Swartz for his new home at 30 East 85th Street, prosecutors are probably going to have a tug-of-war on their hands. Tyco officials told The Observer that Mr. Swartz’s penthouse actually belongs to the New Hampshire–based company-and it’s therefore not the government’s to seize.
“That is a Tyco apartment,” said Tyco spokesman Gary Holmes. “[Tyco] has always owned the apartment. It was in Mr. Swartz’s name because that was necessary for condo [regulation] purposes. But Tyco owns the apartment.”
Ms. Thompson in the Manhattan D.A.’s office said the ownership question is a matter of ongoing legal wrangling.
“It’s under negotiation by all the parties,” Ms. Thompson said, “by his attorney, us and the court. It’s a matter we’re aware of.”
Mr. Swartz’s lawyer, Charles Stillman, declined comment.
Records show that Mr. Swartz put his 5,188-square-foot apartment on the market only a few months after purchasing it in early 2000-long before news of the Tyco scandal broke. City records list Mr. Swartz as the buyer of the condo, and date the purchase to May of 2000, in the amount of $7.7 million. Mr. Swartz then listed it in September of that year for $12.5 million. By March of 2001, that price had spiked to $16.5 million, and by September of 2001 it had come down to $15.9 million, where it stood when Mr. Mottola purchased the apartment.
The condo has four exposures on the 28th and 29th floors, as well as seven bathrooms, a private landing and an eat-in kitchen.
Mr. Mottola, one of the most powerful people in the entertainment business, is currently selling his condo in an East 60′s townhouse for $45 million.
All in the Family: imclone Shares Feather Waksal Daughter’s $1.42 M. Tribeca Nest
When former ImClone Systems chief Sam Waksal learned in December that the Food and Drug Administration was poised to reject his company’s experimental cancer drug, he allegedly made several panicked calls to friends and family members (including his daughter Aliza), instructing them to dump their ImClone shares immediately. Ms. Waksal sold 39,472 shares, with gross proceeds of $2.46 million.
Mr. Waksal-who pled guilty on Oct. 15 to charges including securities fraud, perjury and obstruction of justice-contended that he didn’t disclose any insider information to Ms. Waksal. Rather, he said in court, he told her to sell the shares so that she would have enough cash to purchase an apartment.
Seven months later, Ms. Waksal closed on a 3,752-square-foot loft in a Tribeca building owned by her family’s development company. And it looks like the family connections paid off here, too: According to city records, Ms. Waksal paid $1.42 million for an apartment that listed at $1.95 million. Ms. Waksal could not be reached, and her lawyer, Abbe Lowell, did not return calls for comment.
In his guilty plea, Mr. Waksal took great pains to avoid implicating any of his friends or family in his fraudulent dealings. Nevertheless, investigators still haven’t ruled out filing criminal charges against Aliza Waksal, or any other people who may have benefited from Mr. Waksal’s inside information.
Ms. Waksal, 28, is a graduate student at New York University and starred in an off-Broadway play called Spine in November of 2000. Her new home, at 169 Hudson Street (between Vestry and Laight streets), was a former equipment warehouse that was converted into 12 luxury lofts in mid-2000. The company responsible for the conversion was BDB Development, of which the principals are Mr. Waksal, his brother Harlan, his daughter Elana and her husband, Jarrett Posner-all of whom are being eyed by prosecutors in the insider-trading scandal, along with Martha Stewart and Peter Bacanovic, the former Merrill Lynch broker who pushed through Ms. Stewart’s and Ms. Waksal’s sales of shares.
BDB Development has converted several other buildings in the city, including one at 60 Warren Street. The New York Post reported on Oct. 28 that the owners of a quadruplex penthouse at 60 Warren are threatening to sue the Waksals if they don’t compensate the owners for allegedly poor construction on the apartment.
Back at 169 Hudson Street, the previous occupant of Ms. Waksal’s apartment was also connected to the Waksal clan. The old owner, Andrew Peltz, is the son of Wall Street giant and Triarc Companies chief Nelson Peltz-a friend of Mr. Waksal’s and an investor in another one of his start-up companies, Scientia Health Group.
Nelson Peltz, incidentally, is currently listing what Fortune magazine recently called the most expensive home in America: He’s asking $75 million for his 44,000-square-foot oceanfront estate in Palm Beach, Fla.
upper east side
8 East 83rd Street
Two-bedroom, two-bathroom co-op.
Asking: $895,000. Selling: $900,000.
Maintenance: $1,281; 50 percent tax-deductible.
Time on the market: two weeks.
BIDDING WAR SPARKS FIRE SALE When the woman who owned this co-op died, she left behind an apartment filled with art, antiques, furniture and various knickknacks. And when her place hit the market, the bids came in fast, and over the asking price. Gold Coast two-bedroom apartments for under $900,000 are a rarity these days. In fact, things happened so fast that the woman’s far-flung children had to make an emergency trip to the apartment to sell all its furnishings before the buyers made a final walk-through. “They came from Florida, California and Nevada,” said the apartment’s listing broker, Barbara Schwartz of the Corcoran Group. “They took a week to get everything sold and moved-researching antiques specialists, selling art work and shipping furnishings across the country. They did a Herculean job.” In the midst of all the hubbub, the frenzied children met the new buyers: He’s in financial services, she does volunteer work for New York Fire Department families affected by Sept. 11. The two parties hit it off so well that the children left an orchid for the buyers during the closing. “There are so few nice stories about real estate in this city,” said Ms. Schwartz. “This was kind of different.”
upper west side
239 Central Park West
Two-bedroom, three-bathroom co-op.
Asking: $1.25 million. Selling: $1.23 million.
Maintenance: $1,750; 44 percent tax-deductible.
Time on the market: 28 months.
ORDEAL OF THE YEAR “It was an impossible deal to close,” said broker Haidee Granger, of Fox Residential Group, about this Central Park West co-op. “It left my head spinning.” When the apartment first hit the market in January of 2000, the problem seemed run-of-the-mill enough: The sellers’ dark-colored, Zen-like furnishings scared off prospective buyers. Over the next few months, Ms. Granger gave open house after open house-to no avail. “I began to get rather desperate,” she said. But by early 2001, Ms. Granger had at last lined up a buyer. The co-op board accepted the application and set an interview date for early fall-Sept. 11, to be exact. That day, the buyer’s husband died in the terrorist attack; his office was on the 104th floor of Tower 2 at the World Trade Center. Ms. Granger took the apartment off the market for a few months, and began to market it aggressively again in November. Another potential buyer emerged-but she went on a European vacation at the last minute, and Ms. Granger has not heard from her since. “By now, I’m getting really, really desperate,” Ms. Granger said. The people who ended up buying the place surfaced in May of this year. They cleared the co-op board without incident, but on the day of the closing, one of the lawyers noticed a clerical error that ended up postponing the closing for another three weeks. Of course, the seller had already moved out of the apartment by that time, and she couldn’t find a cheap hotel that could accommodate her large pit bull. She asked Ms. Granger if there was room in her place. “My daughter’s room was available, so I said, ‘Yes, but the dog can’t come,’” recalled Ms. Granger, who was worried that the pit bull might eat her tiny bichon. “So she checked into my apartment, and the dog checked into Biscuits & Bath”-a dog spa on 44th Street, between Second and Third avenues. That arrangement held until the final closing. “People behave in the most bizarre ways,” said Ms. Granger. “It was a real New York real-estate saga.” But as in most sagas, the hero reaped a rich reward: Ms. Granger received the Real Estate Board of New York’s coveted “Deal of the Year” award last week.
53 N. Moore Street
Two-bedroom, two-bathroom condo.
Asking: $1.595 million. Selling: $1.565 million.
Charges: $1,102; taxes: $1,200.
Time on the market: two months.
OLD TIMER’S RETURN This loft’s previous owner was a deputy mayor in the Koch administration who had lived in Tribeca since the pioneering mid-70′s. “He came here the same time as Bob De Niro,” said the apartment’s listing agent, Elaine Schweninger, a senior vice president at Insignia Douglas Elliman, herself a longtime Tribeca resident. “He even had an old T-shirt from a bar called Barnabus Rex, which was where the Duane Park Café is now.” The ex-politico’s loft has classic Tribeca features like beamed ceilings and oversize windows, but also some new touches like stone bathrooms and a stone and steel kitchen. The owner was well-liked and known among neighborhood residents for his penchant for outdoor exercise. So when Ms. Schweninger heard that her neighbor’s apartment was on the market, she thought he was off to sunny Florida or some such. But the call was from building’s condo board. “They said he had died,” said Ms. Schweninger. “It had been a short, unexpected illness. I can’t tell you how shocked I was.” The current owners are looking forward to having a family. “It’s the end of one Tribeca era and the beginning of a new [one],” said Ms. Schweninger, who worked on this deal with Insignia vice president Craig Liddle.