Southampton Home Sells for Nearly $43 Million

The home at 40 Meadow Lane has been sold, but who should legally receive the profits is a question before the court.
Taylor K. Vecsey

A home on Meadow Lane in Southampton Village that has been the subject of a recent legal battle over ownership has changed hands for nearly $43 million, according to real estate deeds.

The off-market trade for 40 Meadow Lane on the exclusive street coined Billionaires’ Row closed on April 5 for the exact amount of $42,923,600. The deal is believed to have been brokered by Hedgerow Exclusive Properties, a Bridgehampton-based firm that specializes in off-market listings, as well as Douglas Elliman Real Estate. The brokers declined to comment.

The transaction will likely land within the top five largest on the East End so far this year, and the third highest in Southampton, based on what has been sold or gone into contract so far in 2021.

Nir Meir, who oversaw a multi-billion real estate portfolio for HFZ Capital Group, a once prominent condominium developer in New York City, is the seller.

A recent lawsuit claims he was “siphoning off millions” from the company and even transferred ownership of the home from HFZ, which he left in December, amidst several lawsuits, The Real Deal reported at the time.

Ziel Feldman, the chairman, in an effort to claim the money from the house sale, filed a suit against Meir and the limited liability companies involved on April 6. Over the course of a decade — during which Meir “styled himself as the ‘managing principal’ (although he was never an owner or member of HFZ)” — he used his position to divert millions of dollars of HFZ’s cash and assets for his own personal use, the suit alleges.

“Meir’s looting of HFZ assets accelerated in recent years and encompassed a wide range of wrongful activities, from buying hundreds of thousands (if not millions) of dollars of investment-grade wine for himself with HFZ’s money to transferring a forty-five million dollar, beachfront Southampton home from HFZ ownership to entities owned and controlled by Meir and his family members,” the suit claims.

HFZ funds were used, the suit says, to purchase the .76 of an acre property, build a new 6,600-square-foot modern home, furnish it, and to pay the taxes ($65,331 annually records show) and upkeep, as well as to pay for a full-time domestic staff while Meir and his family lived there for no cost.

In addition to reportedly embezzling $15 million in credit card reimbursements and cash, all while living rent-free in a furnished Upper West Side apartment worth $13 million that is owned by HFZ.

“Meir, in effect, had been using HFZ as his own personal piggy-bank,” the suit says.

“It is unfortunate that HFZ Capital Group, and its principal Ziel Feldman, continue to spread demonstrably false and defamatory claims like this against Nir Meir, especially considering Mr. Meir’s significant contributions to the company over the past fifteen years,” said Larry Hutcher of Davidoff Hutcher & Citron, on behalf of Meir.

“HFZ’s allegations of wrongdoing were soundly rejected by the court which denied, in its entirety, HFZ’s request for a temporary restraining order and an order of attachment based on these same allegations and after reviewing HFZ’s papers and hearing oral argument on April 7, 2021, Justice Paul J. Baisley, Jr. declined – that same day — to sign HFZ’s proposed order of attachment.”

The suit claims “Meir’s conduct has deprived HFZ of tens of millions of dollars in cash and assets.”

“HFZ has numerous debts and creditors of its own and it owes those creditors an obligation to pursue funds that were wrongfully diverted from HFZ so that such funds can be used to repay HFZ’s debts,” the suit states.

Feldman also recently unloaded his oceanfront home in Bridgehampton in an off-the-market trade also brokered by Hedgerow Exclusive Properties and Douglas Elliman Real Estate. Feldman’s home at 187 Dune Road sold for $50.15 million, one of the priciest sales in the Hamptons in 2020.

One of  HFZ’s lenders, Monroe Capital, which recently foreclosed on its industrial portfolio, previously purported to hold the title to 40 Meadow Lane and filed a lawsuit in late December accusing Meir of illegally occupying the property, according to The Real Deal. The lawsuit was subsequently dismissed with prejudice on March 22, 2021.

In his request to the court to toss the suit, Meir claimed that HFZ had initial control over the company, but later transferred 50% ownership to him. The Real Deal reported in January that Meir’s lawyers filed a motion that showed another company fully controlled by him, EZL 40 Meadow Lane LLC, held the majority interest as of March 2019. Feldman’s suit rejects this claim.

The deed transfer following the April 5 closing shows EAM 40 Meadow Lane LLC as the seller. Smithtown Partners LLC was listed as the buyer.

Feldman’s suit, which also names EAM and EZL as parties to the suit, acknowledged that the house was being sold, and while the April 6 filing — just a day after the house had closed — did not know the exact purchase price, the suit said “the house is expected to fetch more than $10 million over its mortgage debt.”

The equity and the surplus funds from the sale belong to HFZ, the suit says.

The suit also makes mention of a separate agreement to sell the personal property inside the Southampton House for $1 million.

The modern home, not far from Southampton’s exclusive Meadow Club, was once an 1880s shingle-style “summer cottage” fondly known as “A Wee Ly Mor.” The home had been built by the Betts family, one of the original summer colony families. The Fulton Cutting family bought it in the 1930s and owned it for 80 years before putting it on the market for $17.5 million in 2011. Two years later, it sold for $10.5 million in 2013.

The project to build the home was marred with controversy from the start. Meir applied for a demolition permit of the house in 2013, according to CurbedHamptons at the time, and received it, as it was a non-designated historic home, to the disdain of many. In 2014, The Southampton Press reported that neighbors filed an Article 78 lawsuit to stop the project, saying the new design did not fit into the historic district.

The construction moved forward and the new home reportedly has seven bedrooms and an oceanside swimming pool added in 2016. HFZ’s records do not indicate Meir made any monetary contribution toward the construction or maintenance of the home, despite living there. “But living in the Southampton House with household staff apparently was not enough for Meir,” the suit says. “Instead, Meir engaged in a scheme to steal the Southampton House from HFZ,” by fabricating documents and forged signatures to transfer membership interests in the EAM LLC to himself and the newly-created EZL LLC, according to the suit.

Peter R. McGreevy of McGreevy & Henle, a Riverhead-based firm that filed the suit on behalf of Feldman, did not immediately return a request for comment. Christopher Milito, a partner in the Manhattan-based Morrison Cohen’s business litigation department, has since taken over as the attorney of record and did return a call for comment. 

Email tvecsey@danspapers.com with further comments, questions or tips. Follow Behind The Hedges on TwitterInstagram and Facebook.

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