The Deal

The failed real estate deal the newspapers are focusing on this morning involve two developers who have both been linked to sketchy behavior in the past, increasing the possibility that something untoward happened in Greenpoint on Tuesday:

Properties controlled by both Joshua Guttman, who owns the Greenpoint site, and Baruch Singer, who was trying to buy it, have been investigated by the city for suspicious events in the past.

Fire officials have suggested the Brooklyn blaze was intentionally set due to the speed in which it engulfed the warehouse buildings that are slated for demolition.

Mr. Singer, a landlord turned developer, is suing Mr. Guttman to resurrect an 8-month-old contract for $424 million to buy the property and develop it into a luxury condominium complex.

According to court documents, Messrs. Singer and Guttman did not close on the deal by the January deadline because Mr. Singer came up short on financing.

Mr. Guttman then voided the deal, and seized Mr. Singer’s $42 million deposit.

. . .

Mr. Singer, the prospective buyer, has consistently been cited by tenant groups as one of the worst landlords in the city. In 1995, the district attorney of New York County, Robert Morgenthau, conducted an investigation of a six-story Harlem building controlled by Mr. Singer that collapsed and killed three people. Mr. Morgenthau did not file criminal charges against Mr. Singer because the collapse was not “reasonably foreseeable,” according to a press release his office issued at the time. Mr. Singer’s buildings have reportedly racked up more than 4,000 violations with the city’s department of Housing Preservation and Development.

Phone messages left yesterday at the offices of Baruch Singer and his lawyer, Sean O’Donnell, were not returned.

The city’s fire probe will mark the second time that a building owned by Mr. Guttman will be investigated for arson.

Mr. Guttman, who real estate industry sources say is worth hundreds of millions of dollars, owned a loft building in DUMBO that burned down in 2004, prompting an investigation by the city. Mr. Guttman was never charged, but some suspected that the landlord had started a fire to allow him to convert the building into luxury units.

Deny Everything!

I have to say, the owner of the site of Tuesday’s massive Greenpoint blaze that was labeled suspicious doesn’t sound very convincing:

Authorities labeled the blaze that destroyed several of his buildings in Brooklyn suspicious — but real-estate developer Joshua Guttman isn’t crazy enough to have ordered them set afire, his lawyer said yesterday.

“Mr. Guttman is a very wealthy man who owns a tremendous amount of property,” the lawyer, Joseph Kosofsky, said yesterday as the ruins continued to smolder.

“He has the permits for demolition of the site. He would have had no reason to do this. He is not nuts.”

Investigators say it could be days before they get a close look at the charred remains of the warehouses at Noble and West streets in Greenpoint. It was the city’s biggest blaze since 9/11.

. . .

Kosofsky said the site that went up in flames Tuesday was rezoned a year ago to allow for luxury high-rise apartments.

“We don’t know what happened, but it is not to his benefit to have this happen,” Kosofsky said.

Between 13 and 15 buildings burned before the blaze was finally brought under control after 36 hours. “It jumped from one building to another,” Kilduff said.

The size of the blaze made it look like arson, Police Commissioner Ray Kelly said.

“The level of fire when they arrived was consistent throughout the location. In other words, it didn’t look like it started in one spot,” Kelly said.

Guttman’s wife, Vera, defended her husband: “There is nothing to hide. Why would he have to do something like this?”

Having his lawyer and wife repeat over and over that “he would have had no reason to do this” doesn’t mean that there isn’t actually a reason:

The 15 buildings at the Greenpoint Terminal Market in Brooklyn that were gutted in a spectacular 10-alarm fire on Tuesday were at the center of a complex real estate deal gone wrong between established and, at times, controversial developers. They were tangling over property that was itself the target of neighborhood preservationists hoping to secure the district’s legacy as a landmark.

. . .

The buildings are now in ruins and may be a crime scene, and even before the fire, they did not look like much to a passer-by, just relics from a bygone time when they produced bales of rope for the shipyards along the East River.

But the property’s value skyrocketed last year, when a prospective buyer placed a $42 million down payment, a tenth of the entire $420 million deal, and by itself almost twice what the owner had paid for the property five years earlier. Now a lawsuit seeks the return of the $42 million and describes how the deal fell apart.

Preservationists, who had failed in recent efforts to secure landmark status for other Brooklyn buildings, started a campaign to keep the Greenpoint Terminal Market from being knocked down, seeking the support of the local city councilman, David Yassky.

Whether the site’s value, its status as a landmark and the continuing legal battle have anything do with the inferno on Tuesday is unknown. Fire marshals have been unable to enter the site.

Start Investing Along 3rd Avenue Now!

Planners are considering replacing the Gowanus Expressway with a tunnel, perhaps restoring 3rd Avenue to its former glory and rendering pointless hundreds of billboards:

Department of Transportation officials told The Post yesterday the agency has agreed on a subterranean route along the waterfront after reviewing 46 underground proposals — most of them running further inland — over the past five years.

Funding and other considerations will determine whether the below-grade highway ever gets built. The 3.5-mile, seven-lane tunnel would cost $12.8 billion.

But civic groups throughout western Brooklyn have long hoped that most of the crumbling current elevated structure will be torn down.

. . .

The other, far-less-costly options, include rehabilitating the constantly under-repairs expressway — built in the 1940s — or repairing the Gowanus and adding a two-lane viaduct over the existing structure to handle more volume.

DOT cost estimates from 2001 are about $1.7 billion and $2.3 billion, respectively, for those options, adjusted for inflation.

All three proposals will be studied in the project’s environmental review process, which won’t be completed until 2010.

Construction would begin a year later, and a tunnel could take nine years to build, officials said.

That Would Be Suspicious

The Post reports that the Greenpoint Terminal Market blaze was, according to eyewitnesses, definitely arson:

The raging inferno that ripped through a historic Brooklyn warehouse complex yesterday was immediately labeled suspicious — and eyewitnesses told cops they saw a man pouring a flammable liquid on an adjacent rooftop amid the blaze.

The possible arson at the former Greenpoint Terminal Market was the second blaze in as many years to be labeled suspicious in a building owned by developer Joshua Guttman, authorities said.

Witness Sean Vegezzi told The Post that he and some pals ran to the former terminal with their cameras at around 10 a.m. after hearing about the blaze and scurried up to one of the buildings’ rooftops to take photos.

There, he said, they spotted a man pouring what looked like flammable motor oil into an elevator shaft.

“I said, ‘Hey, what are you doing?’ And he started running down the catwalk,” said Vegezzi, 16.

The teen said that moments earlier, they had seen the same man stuffing sticks and brush into a drainage pipe along the side of the building.

“He didn’t light it, but it looked like he was going to until me and my friends approached him,” he said.

Vegezzi described the man as slim, middle-aged, with graying hair and wearing a beige T-shirt and khakis.

He said that as he and his pals were reporting what they saw to the cops, a man who identified himself as Guttman approached the group.

Vegezzi said the man kept repeating, “It’s not one of my guys, it’s not one of my guys,” before adding to cops, “You’d better catch this guy.”

That Was Some Fire

The Greenpoint waterfront was on fire yesterday, as a 10-alarm blaze burned down part of a historic factory complex, the Greenpoint Terminal Market:

The blaze burned all day as it consumed a former rope factory on West Street near the site of the Continental Iron Works in Greenpoint, which launched the ironclad warship Monitor for the Union 144 years ago. The fire blackened the sky above northern Brooklyn with thick smoke shot through at its base with bright flames a block deep. The plume could be seen for miles.

“It was like a flamethrower,” said John Czaplinski, who lives nearby on Noble Street. “The fire was leaping from one building to another.”

More than 350 firefighters from at least 70 units spent all day at the fire, those in front retreating to safety when entire walls crumbled and launched smoldering red bricks 100 feet down the narrow streets of the waterfront. At 10 alarms, it was called the city’s largest fire in more than a decade, excepting the terrorist attacks of Sept. 11, 2001.

The speed of the blaze and the fact that it started just before dawn in abandoned buildings led investigators to suspect arson, said Fire Commissioner Nicholas Scoppetta. The buildings were owned by Joshua Guttman, of Lawrence, N.Y., a real estate developer with a history of buying commercial properties and turning them into condominiums.

A lawyer for Mr. Guttman, Joseph Kosofsky, said the developer had no idea how the fire began. “It’s the last thing in the world we need right now,” he said. “He’s a very substantial guy. If someone set fire to it, it could have been squatters, it could have been anybody. How in the hell can you watch 21 acres of industrial property?”

. . .

The complex was originally the site of the American Manufacturing Company, built around 1890 initially to make rope and bagging, later manufacturing 10 million pounds of oakum, a jute fiber used in caulking seams on wooden ships, according to the Municipal Art Society. By 1913, the company employed 2,234 workers, many settling nearby in Greenpoint.

. . .

Firefighters fought to keep the flames from jumping West Street, where the buildings were linked by overhead corridors. Shortly after 9:30 a.m., a shower of bricks, plaster and beams crashed onto that street, inches from a parked car. A short while later, the facade of a different wall first buckled, then caved outward, collapsing onto Noble Street.

Commissioner Scoppetta said he expected firefighters to work through the night, followed by the demolition of what remained of the buildings. No one was forced to stay out of their homes, he said.

Mr. Kosofsky rejected any suggestion that Mr. Guttman could have been involved in the blaze. He said the destruction wrought by the fire caused more problems than the demolition Mr. Guttman had planned.

“We can knock it down in a half a day,” Mr. Kosofsky said.

“He is devastated; he is very upset,” Mr. Kosofsky said of Mr. Guttman. “He does not need this aggravation. He had big plans. It is holding him up. He does not need the publicity.”

Councilman David Yassky was on the radio yesterday saying that he was pushing to have the site landmarked.

From Hunters Point, Queens at around 8:00 a.m.: