Westmoreland asks state to investigate sale of Rivertowne tavern property
A Mt. Lebanon real estate company got quite a deal when it bought the 2.9-acre parcel containing the vacant Rivertowne tavern on Route 30 in North Huntingdon for $7,500 — or $512,500 less than the Rivertowne owners paid in 2011.
The sale by Christian Fyke, who owned one-half interest in the North Huntingdon property, to Shivs Real Estate LLC, was so good, in fact, that the Westmoreland County Recorder of Deeds has asked the state Department of Revenue to investigate the transaction.
“They will see why it was sold for only $7,500. That is a high discrepancy,” Recorder of Deeds Tom Murphy said of the difference between what Fyke and business partner Joseph Boros Jr. of Monroeville paid for the property in February 2011 and the price it sold for in January. Boros did not sign the recent agreement selling his half-interest in the property.
Fyke and Boros were among the owners of Rivertowne Brewing, which filed for bankruptcy in May.
With such a “huge” drop in sale price, Murphy said the state and local taxing bodies shared only $150 in real estate transfer taxes, compared with $10,400 in 2011. The state got $5,200 from the 2011 transfer tax but only $75 in January. The Norwin School District and North Huntingdon each received $2,600 in transfer taxes in 2011, compared with $37.50 in January.
“The school districts are struggling, and the townships are struggling,” Murphy said.
The state Department of Revenue will not comment on specific transactions. But in cases where “the sale price is drastically lower than the computed fair market value,” the department will seek more information to determine that the appropriate amount of tax was paid, said Jeff Johnson, a department spokesman.
Fyke’s property had a fair market value at $488,315, according to the county.
The state will review documents from the county. If it determines the transaction was not a bona fide sale and the appropriate amount of tax was not paid, an assessment is generated for additional tax owed based on the computed fair market value, Johnson said.
Sivram Bandhu was listed as the registered office provider for Shivs in Mt. Lebanon, and Prasad Margabandhu of Murrysville was listed as receiving mail for the company.
Neither Fyke, Boros nor representatives of Shivs Real Estate could be reached for comment. Attempts to reach them by phone and at home were not successful.
Although the parent companies of Rivertowne Brewing in Murrysville and four related taverns owned by Fyke, Boros, family members and investors filed for bankruptcy in May, the North Huntingdon property was not included.
The liquor license and restaurant equipment at the North Huntingdon site were sold in a Jan. 24 federal bankruptcy court auction in Pittsburgh for $107,500 to Sheldon Klasfeld, owner of Monroeville Properties LLC.
Klasfeld said he had offered in October to buy the North Huntingdon site and its liquor license for $450,000, but said he was later told the sale could not go through.
Fyke had signed an agreement Jan. 15 to sell the property to Shivs, but that pending deal was not mentioned before or during the Jan. 24 proceedings before U.S. Bankruptcy Judge Gregory Taddonio in Pittsburgh.
“It seems like there is something that stinks,” said Klasfeld, who owns rental properties in Monroeville.
Pittsburgh attorney Daniel Schimizzi, who represented Fyke’s companies in the bankruptcy, declined to comment on the matter.
Sivram Bandhu and Prasad Margabandhu, as well as a string of their current or former businesses, showed up dozens of times in a review of court documents in Allegheny and Westmoreland counties.
Both were in business at Winghart’s Burger and Whiskey Bar when the Monroeville Mall owners sued them in 2015 for $1.1 million in back rent and other alleged damages.
Westmoreland County court records show that owners of the Westmoreland Mall in 2017 sued Bandu Brothers Inc. for failing to pay $25,000 in rent on their Winghart’s Burger location on the property.
Penn Hills officials last year condemned Val Mar Gardens apartment complex, which Margabandhu owned, for a number of code violations that resulted in 25 families being forced to move.
A search of the Allegheny County civil court docket lists Prasad Margabandhu as a defendant in 16 cases from 2009-18, with seven additional cases filed against him by the county, city of Pittsburgh or Pittsburgh Public Schools over back taxes from 2016-18.
A Prasad Bandhu is listed in Allegheny County court records as a defendant in seven additional civil cases.
Sivram Bandhu — or Margabandhu, as he also is known — is listed as a defendant in seven Allegheny County civil cases and as a property owner in 50 tax lien cases.
Carnegie Mellon University Federal Credit Union in 2011 sued a Prasad Marugabandhu and a Shivram Bandhu for more than $6,000 regarding an unpaid 2006 loan used to buy a 1992 Ferrari 348 sportscar, court records show.
Bandhu Development Inc. is listed in nine other tax lien and civil cases, according to Allegheny County court records.
Prasad Margabandhu, Sivram Bandhu and their Bandhu Brothers company are listed as defendants in seven Westmoreland County civil cases, including the pending case involving their Winghart’s restaurant at the Hempfield mall property. The business address for Bandhu Brothers is the Murrysville home address of Prasad Margabandhu, who court records list as also using the last name Bandhu.
Joe Napsha is a Tribune-Review staff writer. You can contact Joe at 724-836-5252, email@example.com or via Twitter .