A New Jersey developer is suing its lender, alleging the firm strung it along with promises of a HUD refinancing while an affiliate positioned itself to take a $100 million Newark apartment tower for a fraction of its value.
Tona Construction and Management filed an adversary complaint against Bravo Capital and its affiliate BPT 50S Funding last month in the U.S. Bankruptcy Court for the District of New Jersey, part of the Chapter 11 case for 50 Sussex Redevelopment Urban Renewal LLC, the entity that owns Hoyt Tower, a 203-unit building at 50-54 Sussex Avenue in Newark. The suit accuses Bravo, led by founder and CEO Aaron Krawitz, of fraudulent misrepresentation, breach of contract and tortious interference.
“We trusted Aaron Krawitz and Bravo to be fair lenders who would guide us through the HUD process. They didn’t do what they promised,” said Domenick Tonacchio, founder, chairman and president of Tona. “Now I stand to lose everything.”
Tona first closed on the property in 2022 and poured 12 floors of concrete using its own funds before closing on a $50 million construction loan in 2023. The 15-story project was at the heart of Newark’s University Heights neighborhood and marked the then-Staten Island-based firm’s first push into New Jersey.
Tona took out a $62.5 million bridge loan from Bravo affiliate BPT in October 2024 to pay off the construction loan on the newly built tower and engaged Bravo the same month to process a permanent HUD loan that would refinance the bridge debt. The lawsuit alleges that after the developer hit an 85 percent occupancy threshold and turned in a completed loan application by August 2025, Bravo began stalling and ultimately never submitted the paperwork — even as the property was separately appraised at about $100 million, well above the debt.
The complaint alleges the delay was entirely intentional. It says Krawitz stood to benefit personally if BPT ended up owning the property through default, since Bravo and BPT are both under his control. After BPT filed to foreclose on the property, Tona sued.
Tona also accuses Bravo of interfering with an unrelated refinancing of two Brooklyn properties that would have funded its interest payments on the Newark loan, claiming Krawitz told a co-lender on that deal, Infinity Commercial Lending, that Tona’s principals were “problematic,” which the developer says derailed that financing too.
Infinity wrote in an email cited in the complaint that it was withdrawing in part because of Tonacchio’s “history of repeatedly attempting to use the court system to negotiate” around loan requirements.
Bravo tells a different story. A person familiar with the lender’s accounts told The Real Deal that Bravo was actively processing the HUD refinancing through fall 2025 when Tonacchio himself allegedly pivoted away from it, opting to pursue a CMBS loan he believed would close faster and with fewer conditions.
The loan agreement gave Bravo an “exclusive right, but not an obligation” to handle the HUD process, the person said, and it was Tonacchio — not Bravo — who allegedly walked away from it.
A November 2025 letter from Tona’s general counsel to Bravo, cited in court filings, told the lender that a CMBS loan was now the company’s “only path forward” and warned that they would need to declare bankruptcy if that financing fell through.
Tona allegedly pulled out of the loan application process after Bravo’s third-party environmental report flagged repair work that Tonacchio was unwilling to complete. The developer’s subsequent refinancing attempts — a CMBS deal introduced through BMO, and a loan from Sheridan Capital — also allegedly fell apart.
Tona allegedly stopped making interest payments on the BPT loan in December 2025, and the debt has since grown past $70.7 million with default interest accruing at roughly $43,000 a day, according to court records. Property taxes on the building had also allegedly gone unpaid, and Tona’s bankruptcy filing lists about 20 unpaid vendors, including appraisal firm Newmark whose $100 million valuation the developer cites in its fraud claim.
On July 23, a bankruptcy judge denied Tona’s motion to block the appointment of a receiver over the property, clearing Bravo to install Ian Lagowitz of Trigild LLC to take over operations. The receiver now controls a property generating roughly $375,000 a month in rent.
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