N
ightingale Properties has sold the ground lease of 20 East 46th Street in Midtown East to a joint venture between Namdar Realty Group and Klosed Properties for $10.4 million, according to property records. The acquisition came via a deed-in-lieu of foreclosure, following a lawsuit by Namdar and Klosed against Elie Schwartz and Nightingale over a $30 million loan backed by the building. The lender had sued after Nightingale defaulted on the loan, which carried a $26.2 million balance at the time.

    Nightingale purchased the leasehold on the 15-story building for $28 million in 2016, with 27 years remaining on the lease. It's unclear how many properties Nightingale still owns in New York, but Schwartz has been forced to sell off assets after being accused of misappropriating tens of millions from investors via CrowdStreet. He reached a settlement to repay investors $4 million quarterly, but missed payments and is now facing further backlash.

    Schwartz is also selling personal properties to make his investors whole, including listing his Lincoln Square penthouse for $19 million. The Department of Justice and Securities and Exchange Commission are investigating the developer's alleged fund mishandling.