The Dark Side of Real Estate Part 2

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Exploring the lives of Robert Durst, Daniel Flynn & Cesar Pena

Will Rogers once famously advised a friend to “buy real estate – they ain’t makin’ any more.”

Sounds like a reasonably reliable formula for success — and it is.

So how come so many moguls, tycoons, wizards, magnates, nabobs, bigwigs, personages, captains of industry and just plain smart business people involved in real estate want more than that? At times, so much more that they run afoul of the law?

This is real estate’s Dark Side, the industry’s seamy underbelly comprised of shady deals, broken promises and unlimited amounts of greed and ambition – and which few casual observers even realize exists until it splashes across the pages of the scandal sheets.

The Jewish Voice wants to lay bare this too-often hidden side of the world of big-time real estate and the people who run it so that our readers know the full story — the lay of the land, and where the bodies are buried underneath it.  In this week’s installment, we present to you three women who made their dubious mark on the industry they represented and whose reputations were severely tarnished in the process.

ROBERT DURST

– Kathleen McCormack Durst and Robert Durst. Photo Credit: robertdurst.wordpress.com

The heir to a real estate fortune, Robert Alan Durst, has been dominating the headlines for a number of years but the ink he gets from the media has little to do with big real estate scores or new buildings that he is either acquiring or having built.

The enigmatic Durst is a pathetic figure as he seems to always be at the center of a murder trial but somehow slithers his way out of it. He is suspected of having murdered three individuals in different states: Kathleen McCormack Durst, his first wife, who disappeared in New York in 1982; Susan Berman, his longtime friend, who was killed in California in 2000; and his neighbor, Morris Black, who was killed in Texas in 2001.

But, let’s start at the beginning. Durst who was born in 1943 is the son of  New York City real estate mogul Seymour Durst; and the elder brother of Douglas Durst, head of the Durst Organization.

According to a Wikipedia profile, Durst grew up in Scarsdale, New York, to a Jewish family. His siblings are Douglas, Tommy, and Wendy. Durst’s paternal grandfather, Joseph Durst, who was a tailor when he emigrated from Austria-Hungary in 1902, eventually became a successful real estate manager and developer, founding the Durst Organization in 1927. Seymour became head of the family business in 1974 upon his father’s death.

The Durst Organization is one of the oldest family-run commercial and residential real estate companies in New York City. The company is owned and operated by the third generation of the Durst family. As of 2014, it owns and manages more than 8.5 million square feet of Class A office space in Midtown Manhattan and over 1 million square feet of luxury residential rentals.

In 2010, the Durst Organization bid on and won the right to invest $100 million in the One World Trade Center Development, becoming a co-developer with the Port Authority of New York and New Jersey. Its contract with the Port Authority gives the company a $15 million fee and a percentage of “base building changes that result in net economic benefit to the project.” The specifics of the signed contract give Durst 75 percent of savings up to $24 million and stepping down thereafter (to 50 percent, 25 percent and 15 percent) as the savings increased.

When Robert was seven, his mother died as a result of a fall from the family’s Scarsdale home; he later claimed that, moments before her death, his father walked him to a window from which he could see her standing on the roof. In a March 2015 New York Times interview, however, his brother Douglas denied that Robert had witnessed her death. As children, Robert and Douglas underwent counseling for sibling rivalry; a 1953 psychiatrist’s report on 10-year-old Robert mentioned “personality decomposition and possibly even schizophrenia”.

Durst attended Scarsdale High School, where classmates described him as a loner. He earned a bachelor’s degree in economics in 1965 from Lehigh University, where he was a member of the varsity lacrosse team and the business manager of The Brown and White student newspaper. He enrolled in a doctoral program at UCLA later that year, where he met Susan Berman, but eventually withdrew from the school and returned to New York in 1969. Durst went on to become a real estate developer in his father’s business; however, his brother Douglas was appointed, in 1992, to run the company. The appointment caused a rift between Robert and his family.

On March 14, 2015, Durst was arrested in New Orleans on a first-degree murder warrant in relation to the Berman killing. On November 4, 2016, he was transferred to California and soon after was arraigned in Los Angeles on first-degree murder charges. In October 2018, Los Angeles County Superior Judge Mark Windham ruled there was sufficient evidence for Durst to be tried for the death of Berman. His trial began on March 2, 2020, but was postponed when Superior court judge Mark E Windham announced that the trial, which had been under way for six days, will stand adjourned until a later date due to the COVID-19 outbreak.

Durst was the subject of a multi-state manhunt after Black’s body parts were found floating in Galveston Bay, but although he admitted to the dismembering of Black (which he was not charged with), he was ultimately acquitted of his murder on the grounds of self defense.

In March of 2020, the AP reported that  a prosecutor in a Los Angeles courtroom repeatedly told a jury that Durst did indeed kill his wife.

“Bob Durst killed his wife,” Deputy District Attorney John Lewin said at one point during his opening statement at the Durst trial, who is charged only with the murder of his friend Susan Berman in 2000.

The judge in the case has ruled that the prosecution can provide evidence and say that Durst killed his wife to establish motive for Berman’s killing, and Lewin took full advantage, repeating and emphasizing the statement, as was reported by the AP.

“On the day that Durst killed her,” Lewin said as he opened one part of his presentation. “They were married at the time he killed her,” he said in another part, “Durst killed Kathie when they were spending the weekend together,” he said later .

He said it so much that it drove Durst’s attorney Dick DeGuerin to interrupt.

“I’ve got to object to this conclusion that Bob Durst killed Kathie,” said DeGuerin, who said it was an impermissible legal argument and not a presentation of evidence. He was overruled.

Prosecutors charge that Durst killed his friend to prevent her from meeting with Westchester County officials who had re-opened an investigation into the suspected murder of Kathie Durst. After Kathie Durst mysteriously disappeared, Berman served as Durst’s unofficial spokeswoman but to her friends she related that Durst had acknowledged murdering his wife and said that she helped cover his tracks.

In June of 2018, it was reported that a lawyer representing the family of his ex-wife Kathie, announced that they would drop their $100 million wrongful death suit against him, if he fesses up to what happened to her.

Family attorney Bob Abrams told The Post at the time that, “Just to be 100 percent clear if, in the next 48 hours, Durst or one of his co-defendants tells us where he dumped Kathie’s body so we can retrieve it, we would immediately drop this lawsuit against him.”

Over Kathie’s 1982 disappearance, her three sisters Carol Bamonte, Mary Hughes and Virginia McKeon have a $100 million wrongful death case pending against the disgraced Durst.

In January of 2020, CBS News reported that according to his attorney, Durst is the author of the anonymous note that alerted police to the location of the body of Berman.

Durst has gone on record on numerous occasions saying that he was not culpable in his wife’s disappearance. CBS reported that she was  declared legally dead in 2017. Her body has never been found and no one has been charged in that case.

Durst participated in an HBO documentary about the case several years ago. Later, Durst admitted that his participation in the documentary was “stupid” which seemed to have implicated him. “The Jinx: The Life and Deaths of Robert Hurst,” is what landed him in jail in 2015.

One day before the finale of the HBO documentary, Durst was arrested in New Orleans while allegedly trying to escape to Cuba.

Durst has been held without bail since his arrest in 2015. He’s had some health issue including hydrocephalus, or otherwise known as “water on the brain.”

Durst would face life in prison without parole if convicted of murder with special circumstances of witness killing and lying in wait. There is also an accusation that he personally used a handgun to carry out the murder.

The May 23, 2017 headline from the Associated Press was startling: “Real estate mogul gets prison for fraud scheme”

DANIEL FLYNN

 

Daniel Flynn, a Quincy native who served for years as master of ceremonies for the city’s annual St. Patrick’s Day luncheon and roast, specifically pleaded guilty to bilking 10 victims out of at least $9.5 million, according to the Patriot-Ledger. But prosecutors had alleged many more victims, and a dollar amount over $20 million stolen by Flynn, numbers reflected by this restitution agreement. Photo Credit: hamilton.wickedlocal.com

“The Patriot Ledger (http://bit.ly/2pwerNd ) reports that Daniel Flynn III, of Quincy, Massachusetts was sentenced to four years in federal prison and three years of probation on Tuesday. Flynn pleaded guilty to criminal fraud in February,” the piece read. “Authorities say he bilked at least $9.5 million out of 10 victims by using false representations of his real estate business in a Ponzi scheme. Prosecutors earlier claimed Flynn squeezed $21 million out of 150 people. However, Flynn admitted to cheating 10 victims as part of the plea deal.”

Flynn, a Quincy native who served for years as master of ceremonies for the city’s annual St. Patrick’s Day luncheon and roast, specifically pleaded guilty to bilking 10 victims out of at least $9.5 million, according to the Patriot-Ledger. But prosecutors had alleged many more victims, and a dollar amount over $20 million stolen by Flynn, numbers reflected by this restitution agreement.

Flynn has admitted to engaging in a scheme for nearly eight years – from 2007 to when he was indicted in 2015 – to obtain money from various people in the area based on false representations of his real-estate investment funds and other property transactions, as was reported by the Patriot-Ledger.

The judge overseeing the case eventually called for a shorter amount of time in jail that the six years called for by the prosecution. Flynn also was ordered to reimburse those he had victimized.

Months later, in August, Sean Philip Cotter of The Patriot Ledger wrote that Flynn had confirmed that he would reimburse his 73 Ponzi scheme victims to the tune of over $20 million. The plan received the official stamp of approval from federal Judge Rya Zobel.

“Prosecutors have called Flynn’s scams “similar to a Ponzi scheme,” as Flynn used money from new investors to pay off older ones. Among the various schemes was an instance when he solicited investments to “buy” a building he secretly already owned near Quincy Center. Some of the proceeds went to pay off previous loans, and some of them went to projects such as remodeling his kitchen.”

A so-called “Ponzi scheme,” as those who followed the Bernie Madoff trial know, is a form of fraud that lures investors and pays profits to earlier investors with funds from more recent investors. The scheme leads victims to believe that profits are coming from product sales or other means, and they remain unaware that other investors are the source of funds.

Flynn was apologetic at his sentencing hearing, adding that he had “lost control of everything.” Cotter noted, “Flynn told the court he’d fallen on hard times after the stock market crashed in 2008. When he was arraigned in August 2015, the court deemed that he met the threshold to be appointed a federal public defender to represent him.”

 

Cesar Pena

Cesar Piña’s life story is the stuff that cinematic franchises are made of.

The guy walks out of a jail cell with empty pockets and 13 years later he’s worth $65 million. As recounted by the web site earnyourleisure.com: “In 2005 he was sentenced to 18 months in a federal penitentiary. A day before he turned himself in he married his fiancee who was pregnant at the time. What would seem to be his lowest moment actually turned into a blessing.”

While incarcerated, New Jersey resident Piña became good friends with a one-time real estate mogul, and the information exchange kicked into gear: he told the mogul the basics of how to survive behind bars, and the mogul shared his real estate success secrets.

“Flipping,” of course, is a term used primarily in the United States to describe purchasing a revenue-generating asset and quickly reselling (or “flipping”) it for profit. Though flipping can apply to any asset, the term is most often applied to real estate and initial public offerings (IPOs).

Fresh from jail, Piña needed to raise cash. He sold possessions like his new wife’s ring and his automobile and got a loan from family in order to buy his first property, a small house. More than a decade later, he is said to own more than 900 living units and is hard at work building apartment complexes.

Here is how he describes his journey on his own web site: “Cesar Pina started his real estate journey early 2006 and has since made a name for himself giving inspiration and motivation to others who want to invest their money. Cesar Pina partnered with Dj envy (Power 105.1) in 2018 and started touring creating seminars for people who want to learn the real estate business. Their seminars took place across the tri-state area. Cesar being from New Jersey has also partnered with Fetty Wap & NittDaGritt in real estate.

Cesar has been featured on The Breakfast Club where he spoke about himself educating others on real estate development, investing & flipping houses. He’s also been featured on North Jersey, Paterson Times, Drink Champs podcast, etc. Cesar Pina has been rehabbing and flipping homes for over a decade. With over 600 rental properties in Paterson, Cesar has become the foremost authority on how to make it in Real Estate. Starting from virtually nothing, Cesar is the definition of “self-made” and has perfected the art of financing projects. Now Cesar is sharing his journey, passion and knowledge with others.”

 

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