Investor Sues Mike Kohan, Alleging $19.5M Stake in Former Citadel Center Wiped Out

An investor who claims he put $19.5 million into the 37-story Chicago office tower at 131 South Dearborn Street is suing Mike Kohan, alleging the landlord wrongly transferred the company controlling the building to his own British Virgin Islands firm and erased the investor's stake. Moise Lavian filed suit late last week in Cook County court against Kohan Properties Ltd. and Mehran Kohansieh, Kohan's legal name. He seeks a declaration that he is majority owner of 131 South Dearborn Realty Management LLC, the entity atop the 1.5 million-square-foot former Citadel Center, and accuses Kohansieh of breach of fiduciary duty. Kohansieh's group bought the tower in June for a little more than $100 million, using a $65 million Bayerische Landesbank mortgage. Closing paperwork showed Kohansieh owning the entire ownership entity, according to the suit. Lavian says a July 29 operating agreement listed a 50% stake tied to a $12.2 million contribution, but his total reached $19.5 million, making him majority owner. He learned earlier this month that Kohansieh transferred 100% of the entity to Kohan Properties Ltd., the vehicle behind a roughly $112 million Israeli bond raise. A hearing is set for Dec. 22.