This is such a puzzle....The Realtor.com listing for 61 Sturbridge Road, New Canaan contains the following information:
- Current Listing Price: $3,975,000
- Creditors: Danbury Bank $2,750,000; Giannis Toutziaridis $500,000; Harry Masiello, $600,000; Trust of GF which I believe is $500,000; Plus 3 others vendors and the city of NC for taxes amounts unknown; Additionally there would be interest payments and taxes due. The defendants listed in red are individuals or businesses who sit in the 4th-7th positions to receive payments.
- The price Fd paid for this property was $1,500,000 in 7-18-2017. So, if FD worked on the property throughout 2017-2019...What did he do with the loans from his friends? They was made prior to the bank loan in 2017. The price has fluctuated greatly. It was on the market in August 2017 for $4,50,000. Was this a build to suit price? In terms of "flipping a house" this was a disaster. It certainly did not have anything to do with the disappearance of JFd.
- Here's the pricing since Fd purchased it:
- 10/09/2019 Price Changed $3,975,000 $422 SMARTMLS
08/28/2019 Listed $3,999,999 $424 SMARTMLS
07/01/2019 Price Changed $3,999,999 $430 SMARTMLS
07/01/2019 Price Changed $3,999,999 $548 Newcanaan
06/17/2019 Price Changed $4,495,000 $483 SMARTMLS
06/17/2019 Price Changed $4,495,000 $616 Newcanaan
04/02/2019 Price Changed $4,675,000 $640 SMARTMLS
04/02/2019 Price Changed $4,675,000 $640 Newcanaan
09/17/2018 Listed $4,800,000 $658 Newcanaan
09/17/2018 Listed $4,800,000 $658 SMARTMLS
02/19/2018 Listed $4,800,000 $656 SMARTMLS
02/16/2018 Listed $4,800,000 $658 Newcanaan
10/17/2017 Listed $4,500,000 $615 SMARTMLS
08/23/2017 Listed $4,500,000 $615 Newcanaan
07/18/2017 Sold $1,500,000 $202
So, does this make sense to anyone? Where did all the money go? MOO-MOO
61 Sturbridge Hill Rd, New Canaan, CT 06840 - realtor.com®
Interesting question you are asking with a few possible answers IMO.
Its been awhile but I believe when we last looked at this that the initial purchase was for cash by Fd/FORE as it was part of an auction process if I recall. If I'm incorrect just post below to correct the record.
So, Fd uses god knows which personal financial statements to make a loan request from Danbury Savings Bank for the $2.75 million. Sorry to see that Danbury Savings Bank didn't do much due diligence on who exactly they were doing business with but they probably figured New Canaan mortgage was a 'low risk' proposition. Surprise, surprise, it wasn't!
So, Fd gets the Danbury Savings Bank loan (we have no idea if it was a construction loan or if it was a straight mortgage and fully funded at closing). Assuming Fd got all the cash upfront from the bank, then perhaps he kicked back some of this cash to himself to cover 'personal expenses', Mistress MT travel fees or perhaps even school fees of Mistress/MT daughter? We know he didn't use any of the cash to support JFd or his own 5 children as this was well documented by Judge Heller in Family Court.
House is roughly 9,000 SF so assume Fd cost was in the range of $175SF (IMO the property is medium level based on local standards at best) is $1.575 million and I do think this is generous as just looking at the interior, kitchen, baths and floors and minimal landscaping and no pool he might have been able to cheap out the project at $130/$140 SF if he pushed hard on his subs IMO.
So, now Fd has $1.5 purchase price and rough cost to complete the project of $1.575 million = $3.075 million and this compares to a the Current Ask of $3.975 million.
How likely is the $3.975 million selling price to happen? IMO not very likely as market in New Canaan continues to be poor. New construction projects do sell but it looks like Sturbridge is still priced above the market and IMO its finishings aren't at the level where they need to be to support the asking price. My guess is that the listing broker has been pushing for reductions to move the listing but its been sitting and sitting with no movement. I'm curious how many people other than curiosity seekers have even made inquiries about the property? My guess is not many as its still overpriced. We have no idea of the broker commission but that would have to be paid at closing along with the priority liens and taxes due. Not looking good IMO for Danbury Savings Bank right now as if they auctioned the house the price most likely would be significantly lower than the broker Current Ask. Messy situation.
I question whether BOTH the Mr. T and Masiello loans totally $1.5 million were ever 'funded'. What I mean by this is whether a documented cash trail exists to say that either of these 2 individuals ever gave a penny to FORE/FD? My guess is no money changed hands here or if it did it was repaid quickly but the original liability simply wasn't extinguished by Fd/FORE. My guess is that the only purpose of these 2 loans was to keep any sale proceeds from GF. But, I would very much enjoy a sharp judge asking Fd/FORE to show the entire paper trail and cash transfer history of both loans and I'd love to hear testimony from both Mr T and Masiello about where they thought their money was going to be used in the project. I also suspect that these 2 loans might have been documented for FORE by the infamous and allegedly retired Atty Markowitz (former law partner of KM). I wonder if Atty Weinstein in his investigation relating to the Civil Lawsuit actually got all the real estate files from Atty Markowitz to better understand the games that might be going on here at Sturbridge. Bottom line is that I don't believe there was ever money exchanged for these 2 'friend loans' but if money did fly around here it didn't stay with the project in New Canaan.
Just looking at the rough numbers of the project my guess is that the Mr. T and Masiello loans total the exact amount that Fd/FORE hoped to profit from the project. Fd/FORE OF COURSE didn't want GF to get a penny of the proceeds and he wanted to make sure that he was paid and so he simply added up the acquisition price of the property, construction costs etc. to come up with the amount of the 2 "Friend Loans".
I think the 'miscalculation' here was taking the $2.75 million from Danbury Savings Bank as now its entirely possible that the property won't ever sell for more than the mortgage amount or slightly above that given its notoriety and market conditions.
If you look at the Tax Model on Zillow then the Danbury Savings Bank mortgage is definitely underwater:
Tax model
Estimated value of this home based on 2019 taxes
How it's calculated
2019 tax-assessed value$1,717,425
Avg. difference between tax-assessed value and sale price for homes in this area (+42.0 %)+$721,319
Tax-based estimate$2,438,744
Fd/FORE owes taxes on the property too and that is a priority claim I believe. So, assuming he didn't pay since 2017 then that total is $70,059 owed to the Town of New Canaan. Then there are the trade liens that I have been scratching my head about as its impossible to know if they are 'real' or simply another Fd/FORE scheme to make sure GF gets $0 upon any sale of the property.
Tax history - from Zillow:
YEAR PROPERTY TAXES TAX ASSESSMENT
2019 $31,325(+60.4%) $1,717,380(+49.1%)
2018 $19,534(+1.7%) $1,151,780
2017 $19,200(+2.2%) $1,151,780
So, it looks like Fd/FORE has created another messy situation for people that were doing business with him in good faith. Its hard to see local savings banks such as Danbury potentially taken for a ride but it looks like they are in a potential tough spot with this situation. I do hope that Danbury Savings Bank aggressively litigates this situation and if they for one second believe that fraud is involved that they bring in the proper State of CT authorities to investigate and also sue for fraud themselves and bring in any/all parties possibly involved into the litigation and this would include both Mr T and Mr. Masiello. Ditto on all of this for GF and Atty Weinstein as little about the way this project was financed makes much sense IMO.
MOO