Bankrupt Brentwood businessman Ezri Namvar and his investment partners amassed a real estate empire that last summer had an estimated market value of $2.43 billion, according to a document obtained by the Business Journal.

However, other documents indicate that by November, Namvar’s holdings had shrunk considerably to $1.55 billion. What’s more alarming, the number of his properties during that span fell from 160 to 90.

That feeds the perception among many of his creditors that as Namvar descended into financial problems, he offloaded some properties perhaps to the benefit of a few but to the detriment of many, including those who haven’t received any of their money back.

“I think it is well known among the creditors that in the last six months of 2008, some of the creditors received 50, 60 cents on the dollar some more, some less, depending on the transaction in order to retire their debt,” said Benjamin Efraim, whose family is suing Namvar and his Namco Capital Group Inc. for allegedly failing to repay a $1 million loan.

Indeed, a spot check of the missing properties shows that at least some were sold or transferred to new owners last fall.

The issue of whether Namvar made preferential payments to some creditors is of particular importance because most of Namvar’s creditors are not institutions but individuals, mainly in the Persian Jewish community in and near Beverly Hills. They sometimes turned over their life savings, and many are now in financial trouble because of Namvar’s problems.

The number of people hurt is not clear, but it is believed to range well into the hundreds, and their losses run into the hundreds of millions of dollars. A list of just 40 of his largest creditors from a January court filing said they are seeking a total of $420 million.

Namvar held meetings with creditors late in 2008 and tried to convince them to work out an out-of-bankruptcy-court payback plan. But creditors, some fearing that assets were slipping away as talks went on, threw him in bankruptcy court in late December.

Although legal fees can eat up assets in a formal bankruptcy proceeding, one benefit is that creditors get pro-rated returns if there is any money to be returned.

Lost value

The Namvar holdings were disclosed in three asset lists created by Namvar and/or his company as part of the attempted out-of-court settlement. They were obtained from a person involved in the out-of-court settlement talks last year.

The properties appear to have lost significant value in the real estate crash and may be worth less than what is owed on them.

“He was buying the rosy investment stories that were being presented to him by development sponsors and they were making rosy assumptions,” said Mark Tarczynski, a veteran real estate broker who as recently as 2007 met with Namvar at the request of the businessman to find him investment deals.

Timothy Neufeld, Namvar’s attorney, declined to comment on the content of the lists and suspicion of preferential payments, but insisted his client got into financial trouble when the real estate market collapsed.

“Market conditions have created the present situation,” he said.

The three lists publicly detail for the first time the vast holdings of Namvar and Namco.

The July list is the longest, naming 160 properties, while a November list, said to be the second, has 124. The final list, received Nov. 15 from Namco, according to the source, names 90 properties and is the most detailed. (The final list accompanies this article.)

The Business Journal researched a dozen Los Angeles County properties that appear on the July list but aren’t on the final list. (The Business Journal used data available from the Los Angeles County Assessor’s Office, the city of Los Angeles Department of City Planning and searches of title records. In some cases, findings were verified by sources with knowledge of Namvar’s holdings and business dealings.)

Four out of the 12 properties that were dropped from the final list did not have a name change for the ownership entity, according to the Assessor’s Office. This suggests that the final list does not include some properties held by Namvar or is merely incomplete.

However, eight of the properties are now owned by entities different from those named on the list.

For example, Wilshire Bundy Plaza, a property at 12121 Wilshire Blvd. that houses Namco, appears on the July list with a market value of $119 million but was removed from subsequent lists. The Business Journal previously reported that the property is in escrow and the buyers are a group of Namvar creditors that includes Jade Enterprises LLC, which is headed by Namvar creditor David Taban.

Jade also bought the 11-story Rox-San Medical Plaza in Beverly Hills from Namco last year. While the July list names Roxy-15 LLC as the holder of the medical property, the current owner is Roxbury Medical Towers LLC, according to the Assessor’s Office. The building at 465 N. Roxbury Drive was included on the July list but removed from subsequent lists.

Taban, who is seeking $3 million from Namvar according to a bankruptcy court filing, did not return calls seeking comment.

Another notable finding is the sale of a 37,000-square-foot office building at 822 S. Robertson Blvd. The first and second list name Wilshire 19 LLC as the holder of the property. But it is not included on the final list and a search of title records shows that the property changed hands Dec. 3. According to the Assessor’s Office, the current owners are Robert Hanasab, a trust in his name and 822 Robertson LLC.

Robert Hanasab is the son of Namvar creditor Haroon Hanasab and works for M & Y; Management Inc., his family’s commercial real estate business. According to a January bankruptcy court filing, Haroon Hanasab and M & Y; are seeking $10.3 million from Namvar.

Robert Hanasab said that according to his family’s counsel, the deal does not constitute a preferential payment and the purchase was made without retiring Namco’s debt with his family.

Other significant L.A. properties that don’t appear on the last list and have different owners from those named on the first or second list include: an office building at 11940 San Vicente Blvd., the 20415 Saticoy St. apartment building and a medical office building at 122 E. Washington Blvd.

Properties outside of the county that are named on either of the first two lists but not on the third include a 1,200-acre pistachio farm in Coalinga, land in Hesperia and development property in Phoenix.

It is not illegal to sell properties, but some question the ethics of selling properties in such a situation.

“Unfortunately, in the current economy and the current world we live in you are going to see a lot of desperate people doing desperate things,” said Tom Sestanovich, an Ervin Cohen & Jessup LLP real estate attorney. “Some will be outright criminal, some will be walking a fine line and unfortunately the line gets blurred.”

But deals struck with creditors before the bankruptcy actions could be undone. According to real estate and bankruptcy attorneys, property sales made to pay off creditors that occurred within 90 days prior to bankruptcy could be considered preferential payments and could be unwound by the bankruptcy court.

And preferential payments made in the year prior to bankruptcy could be undone by the court if the deals are with “insiders” defined as business partners or family members, according to the attorneys.

In any case, Namvar and Namco must file a complete list of assets and liabilities on March 15 that will update the documents obtained by the Business Journal.

The latest list, the one that contains 90 properties, shows holdings in at least 17 states and nearly every type of real estate from office to hospitality to raw land.

The stated property valuations on the last list total $1.55 billion and range from $600,000 to $120 million each, with two of the most valuable in downtown Los Angeles.

Among the notable properties are some already known to be Namvar holdings, such as a stalled 76-story downtown condo development called Park Fifth. The list shows he has a 30 percent stake in the project, for which he paid $28 million in 2005. As previously reported in the Business Journal, Namvar has been trying to sell his stake in the project, which would be the tallest condominium tower west of Chicago.

Low-profile properties

But some properties were not widely known to be Namvar’s, such as the Crowne Plaza Hotel in Niagara Falls, N.Y., valued at $50 million, and the Cal Neva Resort in Lake Tahoe, valued at $52 million.

The most valuable property on the latest list is the 469-room downtown Marriott, an aging hotel purchased for $115 million. Namvar took out a large loan with GE Capital, the finance unit of General Electric Co., to finance the 2007 purchase of the hotel at 333 S. Figueroa St.

GE Capital is the biggest creditor named in the January bankruptcy court filing; the company claims it is owed $97.9 million. In a lawsuit filed Nov. 13, the company accuses Namvar of defaulting on an $86.8 million loan.

A. David Youssefyeh, an attorney with L.A. firm ADY Law Group, who is advising several clients who claim they are owed money by Namvar, said the lists confirm what he suspected.

“It isn’t a big surprise he went belly up. There is a lack of focus in the portfolio. You have everything from hotels to houses to office buildings to strip malls to vacant land. Anything having to do with real estate he threw money at it,” charged Youssefyeh, who has his own copies of the property lists because of his involvement in the settlement discussions.

The documents show that Namvar, who, like many of his creditors, is an immigrant from Iran, ran a complex operation that involved lending money to limited liability corporations that he mostly controlled. Those entities would then use the money to make real estate purchases, which also were often financed by conventional bank loans.

The latest list shows Namvar used 82 distinct limited liability corporations to hold 90 properties. It also indicates that in some cases, Namvar owned real estate personally and in others his family is listed as a co-owner. Namco has been described by associates as a family business that includes several of Namvar’s brothers and his father, who are named in many of the lawsuits, in addition to the Namvar Family Trust. Other investment partners include non-family member, sources said.

Complicated structure

It is unclear how this Byzantine structure would affect payouts to creditors in the bankruptcy proceedings. Namvar’s attorney did not comment on repayment plans, but acknowledged the complicated structure of his client’s holdings.

“Namco Capital loaned money to special purpose LLCs, which purchased a broad variety of developed and undeveloped properties in a number of locations in different states with the object of building value in order to sell the properties at a profit and in order to pay back Namco Capital and the interest it was to receive,” Neufeld said.

“Many of those properties became the victims of the tremendous downturn in the real estate market, which reduced or eliminated the equity in those properties and which made it difficult or impossible to repay the loans to Namco Capital.”

Namvar creditors said they were unaware of the complexity of his transactions. One such creditor is Ruben Melamed, who is suing Namvar for $2 million plus interest he claims he is owed. His attorney, Seong Kim, said his client believes the complexity shouldn’t stand in the way of any compensation.

“(Melamed) understood that Namvar and Namco were going to invest it in something and give him a guaranteed return of 8 percent, but not that it was going to a particular project or investment,” said Kim. “They did joint ventures with people. Just because the name is different doesn’t mean Namvar and Namco don’t own something indirectly.”

Perhaps, though, the biggest obstacle to Namvar’s creditors being made whole is the timing of many of his acquisitions.

He made strong bets from 2005 to 2007 on residential properties, raw land and redevelopment opportunities, according to the latest list. He acquired 45 of these properties during those three years for $508 million when prices were at or close to their peak.

The declining value of his assets is sometimes documented on the lists. For example, the total value of Park Fifth, placed at $100 million in July, was written down by 20 percent to $80 million on the last list though some say that’s even high.

“Basically land produces no income, it sucks up capital rather than produces income. And in a lot of cases land values have a negative valuation because there is no income, and you are paying out with taxes and so on,” Tarczynski said.

The Marriott, valued at $140 million in July, is written down by 14 percent to $120 million on the last list, although that valuation has been questioned.

In fact, Tarczynski believes that the total $1.55 billion market value figure attached to last list is “highly inflated.”

One creditor who was given the list believes that it can be conservatively marked down by 40 percent. Using that figure the portfolio would be under water by more than $40 million if only Namvar’s personal share is considered. It would be under water by $46.4 million if it includes all ownership parties, including Namco, Namvar’s family and others.

Meanwhile, it is the predicament of some of the smaller creditors many of whom are said to have lost their life savings that’s gotten the attention of the local Persian Jewish community.

“What seems to be consistent is that a lot of money that was entrusted to him by small investors, widows, orphans and people who relied on that steady flow of interest income was used on risky investments,” said Efraim.

Arash Hakhamian, a student at the USC School of Dentistry, said that about five years ago he starting giving money to Namvar in small sums that totaled less than $50,000. Hakhamian said he worked several jobs such as managing a Robeks Juice outlet to raise the money, which was intended to pay for his education.

But, he said he’s only gotten back about $3,000 and now can’t pay for his final semester of dental school. He even could be kicked out of the program if he can’t come up with $24,000. About a month ago, Hakhamian started protesting in front of Namvar’s synagogue and the courthouse when the businessman is there.

Hakhamian, whose parents and three siblings also gave money to Namvar, holds up large signs emblazoned with the slogans “Shame on Namco Capital” and “Ezri Namvar Please Return My College Money.”

“I have literally have had eight jobs to raise that money,” he said. “I worked $10 an hour to raise that money. What am I going to do? I am stuck.”