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Former developer Marc Kulick faces lawsuits as apartment portfolio enters foreclosure
Fannie Mae has initiated foreclosure proceedings on eight properties in a portfolio that includes more than 9,000 units.
Bisnow reports that Oklahoma apartment developer Marc Kulick is at the center of a wave of lawsuits, including racketeering allegations and foreclosure actions, tied to his Vesta Capital multifamily portfolio.
The dispute traces back to Kulick defaulting on high interest loans taken from Efraim Diveroli, the convicted felon and former arms dealer who served as inspiration for the 2016 film War Dogs. Diveroli then placed second mortgages on all Vesta Capital properties, and management was replaced at 10 Tulsa, Oklahoma properties by Diveroli’s team with help from local police, according to another lawsuit filed by Kulick.
Kulick’s former partners allege he ran a yearslong fraud that diverted cash from Vesta Capital toward a lavish lifestyle and poker losses, while Kulick says he acted in good faith and argues he is instead trapped in a hostile takeover. He is fighting Diveroli’s company, YSA Investments, in court for control of more than 30 assets, as former partners seek to force him out of the company.
HousingWire reports that Fannie Mae has initiated foreclosure proceedings on eight properties across a portfolio described as having more than 9,000 units, and that at least nine holding companies tied to the apartments have filed for bankruptcy, according to documents uncovered by Atrium.ai. Kulick also cited a major insurance cost increase, saying his master insurance policy rose about 43% to 44% from 2023 to 2024, and that he struggled to secure traditional financing when lenders requested more collateral than the assets.