Another Madoff Home Sells, All Hell Breaks Loose
Madoff's former offices spanned three floors of the oval-shaped building at 885 Third Ave. Now that Madoff is getting acquainted with life in a prison cell, a good portion of the 40,000 square feet that he used to work out of sits vacant. Apparently Madoff was the perfect tenant when it came to paying rent, because his departure has caused the building owners, Royal Bank of Canada (RBC), to look for a way to wash their hands of the investment.
Of the three floors Madoff formerly occupied, the U.S. government is reportedly paying for one floor, while Surge Trading, which bought Madoff's legit trading company, is renting another. Madoff's former trading floor, which measures out 16,000 square feet, is currently available for rent at a price of $49 per square foot. Due to low rent revenues, due in part to vacant space left by Madoff, RBC is now seeking a buyer for its $210 million mortgage. RBC reportedly has tapped New York commercial property broker Eastdil Secured to work on selling the debt.
Meanwhile, the reach of Madoff's scams continues to widen as Westport National Bank and PSCC Inc. of Westport were named in a suit filed by Connecticut Attorney General Richard Blumenthal and the state's Department of Banking. The suit alleges that the bank and PSCC owner Robert Silverman overcharged customers, did not properly vet Madoff or his investments and turned a blind eye to signs of fraud. Blumenthal hopes to recoup more that $16 million for Madoff's victims by way of the lawsuit.
As for those indirectly contributing to the coffers of Madoff's victims, yet another savvy buyer has made off with one of his former luxury homes--and at a bargain-basement price. This time, toy mogul Al Kahn, who helped kick off the Cabbage Patch Kids craze in the 1980s, was the buyer who scored one of Madoff's three properties confiscated by the government last year during the midst of the scandal. The money gained from selling Madoff's properties will go to the victims of his crimes.
Kahn and his wife Patsy purchased the palatial Upper East Side penthouse for a cool $8 million, $1.9 million less than the original listing price. Initially, Kahn was leery of purchasing the property because he was concerned about karma issues, according to Patsy. But she was sold as soon as she saw the terrace and panoramic rooftop view, telling the New York Post that the pickings were slim when it came to locating a penthouse on the market that had ample outdoor space.
The couple purchased the property in February, but the co-op's board had to sign off on the sale, which it recently did. The Kahns are now planning their future in the sprawling penthouse and are working with an architect to design a renovation for their new home. They also plan to fill the 4,000 square-foot, 3-bedroom duplex with antiques and their modern and folk art collections.
The New York City penthouse is not the only piece of Madoff property that will be sold to help pay back his victims. The largest of Madoff's former homes is yet to be sold. His 6,500-square-foot Palm Beach, Fla., mansion boasts of a backyard 80-foot dock that sits on the Intercoastal Waterway. In February, the price of the property was reduced for a second time. The Corcoran Group is now asking for $7.25 million for the 5-bedroom, 7-bathroom mansion, which is 15 percent less than the original price.
In September 2009, the first of Madoff's properties to sell went for $9.41 million, much more than the original $8.75 million asking price. The 3,000-square-foot beach home sits on 182 square feet of waterside land. The 4-bedroom, 3-bathroom Montauk beach home was built by Madoff in the 1980s after he purchased the property.
No matter what you think of Madoff, the guy certainly had an eye for prime real estate.