Stalled 179 Ludlow “Rat Castle” Approved for Completion

Posted on: November 8th, 2011 at 6:09 am by

For the second time in as many weeks, another notoriously stalled Lower East Side development is getting the proverbial new lease on life. Last month, it was Hotel Ludlow that was scooped up by BD Hotels (Maritime, Jane Hotels); today it’s the infamous “Rat Castle” across the street at 179 Ludlow.

Yesterday evening, the Community Board 3 Land-Use Subcommittee met to discuss the fate of this five-year-old neighborhood eyesore. But before we jump in, a quick history recap.  179 Ludlow was initially started by 2 Funny Guys in March 2006; bankruptcy followed three months later; first-timer Michelangelo Russo then took the reigns for $5.2 million but quickly followed in the footsteps of failure.  Turns out, Russo entered the fray with capital funded by Michael Goldberg who makes a career of bailing out busted projects and turning them.  Foreclosure followed in March 2010, and as we all know, shit rolls downhill. Now the lender is stuck holding the hot potato, so to speak.

Goldberg appeared before the board to gain approval to finally complete 179 Ludlow Street. His goal is two floors of commercial use totaling 2,880 square-feet, and five 2-BR condo units up above.  The argument was pretty much a slam-dunk case considering the entity, ER Holdings LLC, met three necessary criteria set forth by the Board of Standards and Appeals:

  • A significant amount of work done on the building – 70% of the project was complete before the 2008 rezoning from C-61 to C44A was passed.
  • A significant amount of money invested – $7.5 million was put into the development
  • Investors face financial loss if the application is not approved – it would cost more money to enforce zoning compliance and dismantle the seventh floor ($2 million).

Members were a bit weary, concerned about a possible bait-and-switch with the ground and first level commercial space. There were worries about having a monster club moving in here. And that the real estate should be considered for “community use.” Goldberg insisted that he would only want higher-end gym tenants like SoulCycle to move in here (he’s meeting with them next week to discuss).

Despite the wee bit of static, the issue sailed through the approval process. The board supported the measure to complete 179 Ludlow (15 Yes, 2 No, 1 abstain, 1 present no vote).

Recent Stories

rice-noodle-cart
Rice Noodle Cart Returns to Rutgers Street After Hiatus

As roadwork eases in Straus Square, a morning institution returns to Rutgers Street. The uber-popular Chinese “Rice Noodle Cart” – long a mainstay at the corner of East Broadway – resumed service on Wednesday morning. Its designated sidewalk square had been gobbled up as part of the staging area for the reconstruction of Straus Square, […]

etal-chrystie-club
Reader Report: Bartender Tackles Female Patron on Chrystie Street, Cops Look the Other Way

Looks like the Experimental Cocktail Club will be ending on a controversial note (Et Al is taking over). A reader tipped us off to an incident that went down on Wednesday night (10:30pm) in which a female patron was allegedly manhandled and forcibly removed by a male bartender. The exact circumstances of her removal are […]

essex-crossing-site2-update-1
Pile On: Essex Crossing Hammers First Foundation Elements in Place at Site 2

It’s the moment we’ve not been waiting for. The Gateway to Essex Crossing, as it were, just started to take shape. Its bones, at least. Here and now, the first few building blocks of what will ultimately comprise ten years of construction headaches along Delancey Street. Those twin, five-story pile drivers (and four backhoes) sitting within […]

killion-orchard-street
‘Killion’ Opens Flagship Menswear Boutique on Orchard Street

It took five months of searching, but the old Mastihashop space at 145 Orchard Street is now active again. Another upscale clothier just announced itself. With blinding neons. Killion is now on the dance floor. Earlier this week, Killion installed white lights on location. The boutique specializes in “modern menswear.” It offers a “sophisticated selection […]

prosperity-closed
Prosperity Dumpling Shuttered by DOH a Day After Back Alley Kitchen Exposed

It only took a day for the Department of Health to shutter Prosperity Dumping over its back alley kitchen activities. Inspectors paid a visit yesterday afternoon and closed the joint. The move came after photos surfaced earlier this week showing the shady food prep in action, complete with cameos of resident rats. Standing out front, […]