Originally scheduled to open next year, a proposed 24-story hotel and conference center, developed by WP Realty Acquisition III, is lacking necessary funding, calling for Chapter 11 aid. The company had just filed for bankruptcy on Sept. 11, 2020 due to management conflicts and lack of income. Worse, who actually owns the property is coming into question.
WP was formed in 2016 by D’Wayne Prieto of Ward Capital Management from Dobbs Ferry. Prieto planned to convert the New Rochelle property into a 225-room hotel and conference building, operated by Wyndham Hotels and was granted almost $3.3 million in funding from the New Rochelle Industrial Development Agency.
Prieto had hoped that construction would begin in 2019 and be open to the public in the following year. The building was predicted to be the biggest hotel project in Westchester in 20 years, featuring over 200 rooms, plus restaurant, entertainment, and conference space, so expectations were high.
According to Jonathon Sacks of 118th St. Development LLC, a main partner of WP, the project has been put on hold. Sacks’ company has an 89.9% interest in WP, loaning Prieto $610,713 and investing an additional $1.5 million in the project. Sacks was positioned to assume full management over the project, but someone else also claims they own WP.
Real estate developer Bradley Gold loaned Prieto $100,000 in 2016, with an interest in WP’s future in real estate projects. According to court documents, Prieto had defaulted the loan and in 2019 Gold received a $154,000 court judgment against WP.
Gold removed Prieto as WP’s management this past March and declared himself manager, supposedly claiming 100% interest in the company. In a lawsuit filed by WP against Gold, Sacks claimed that Gold’s business relationship with Prieto is “illusionary”. He also claims that he did not have any knowledge of Gold’s loan to Prieto when he initially invested in WP.
According to court records, Prieto revealed his incorrect “confessions of judgment” about Gold, and Gold is filing lawsuit against both Prieto and Sacks. As a result, the hotel project has had no success in raising outside funds and is now seeking Chapter 11 relief.