Gottlieb heirs outbid former partners at an auction

By Albert Amateau

Another chapter in the history of the late Bill Gottlieb’s Village real estate empire closed last week in a Manhattan courtroom auction when the five-story walkup at 79 Horatio St. was grabbed up by Gottlieb’s nephew, Neil Bender, for $7.4 million.

Actually, the Gottlieb estate owned the mostly vacant 1870 brownstone in partnership with Vicky Gabay, whose husband, Don, was an old high school and college friend of Bill Gottlieb. The Gabays and the Bender family — who inherited the estate when Bill died in 1999 — had a bitter falling out over the management of 79 Horatio St.; the case had been dragging through the courts since the state Supreme Court ordered the property to be sold and the proceeds split between the two parties.

The building, with one rent-controlled tenant on the top floor, was the only one among the estimated 150 properties in the William Gottlieb Management Company holdings that was co-owned. It is located within the Greenwich Village Historic District and a block from the border of the Gansevoort Market Historic District.

Bidders and curious neighbors nearly filled the courtroom to capacity at 60 Centre St. on Wednesday afternoon Aug. 20.

“I’ll open the bidding at $1 million and you’ll need to have 10 percent or more of that to participate in the sale,” the referee, Helene E. Blank, announced at 1 p.m. Fourteen people presented their checks and signed onto a list of eligible bidders.

Starting at increments of $10,000, Bender, Don Gabay and one or two other bidders got it up to $2.5 million before the referee called for bids in $25,000 increments. From then on, it was Bender and Gabay to the knockdown bid of $7.4 million to Bender.

“We haven’t lost anything,” said Vicky Gabay. “It’s nice to have closure, and I’ll be able to give a million dollars to each of my three children.”

The Gabays were close friends of Bill Gottlieb.

“We go way back to college and high school — Baruch and Lincoln High School in Brooklyn,” Don said.

“Billy was best man at our wedding,” Vicky recalled. Their partnership in 79 Horatio St. goes back to 1969 when they acquired the property for a reported $68,000.

However, when Gottlieb, who was noted for acquiring properties — mostly in the Village — and seldom, if ever, improving or selling them, died, his sister Mollie Bender, with her son, Neil, and husband, Irving, ran the firm. The Gabays and Benders had a falling out and Vicky Gabay won a court order in April 2005 for partition and sale of the property, according to Stroock & Stroock & Lavan, attorneys for the Gabays.

In March 2006, Vicky Gabay complained to the court-appointed referee that Mollie Bender refused her access to 79 Horatio St. for a presale inspection.

After the referee ordered the Benders to allow the Gabays access to the property, the Benders went to court to fight the order, saying Vicky Gabay was a passive partner and not entitled to access. The case dragged on until June 19, 2007, when the Appellate Division sanctioned Mollie Bender and her attorney $5,000 each and also ordered $11,000 to be paid to the Gabays’ attorney.

The Appellate Division found that thwarting the right of access was a tactical maneuver to prolong the litigation in an effort by Bender to buy the property at public auction for a lower price.

Mollie Bender died July 1, 2007, and her son, Neil, and husband, Irving, took over the Gottlieb estate. A year later, the referee set the auction date.

Right after the sale last week, Neil Bender issued a statement through a spokesperson, saying, “We are pleased with today’s purchase of 79 Horatio St., which is in keeping with our company philosophy of buying and investing in properties and holding them.”

When the notice of the auction was published on July 23, the building, with 10 apartments — eight one-bedrooms and two studios — and 10 fireplaces, had two rent-regulated tenants. But shortly before the Aug. 20 auction, only one of these tenants remained.

The property’s sale becomes final on Sept. 22, when the full amount must be paid to the referee, subject to adjournments approved by the referee.

The 6,370-square-foot building is 24.5 feet wide by 52 feet tall on an 84-foot-deep lot and includes a rear yard and an existing airshaft that may be used for an elevator subject to necessary city approvals, according to the auction book.

The land was part of the 17th-century farm of Stephen Van Rensselaer, who sold it to Francis Cutting, a lawyer who subdivided the property, which over the succeeding years passed through several hands. The owner in 1868, James Gilmore, hired the architect William Graul to design and build a four-story building, with a raised basement and a subcellar, for five families, completed in 1870. In the 1930s and ’40s, 79 Horatio St. was the home of the novelist William Gaddis and the poet Frances Ford, according to the auction book.