The Shabsels Bankruptcy and the Damis Portfolio Sale
David and Michael Shabsels are moving from raising money to selling assets. Months after raising $195M on the Israeli bond market, their real estate operation has entered bankruptcy, and the brothers are now marketing roughly 50 Damis Holdings properties for sale across 22 states. The portfolio spans more than 5.8M square feet of commercial space and nearly 3,000 residential units, with assets ranging from office, industrial, multifamily and retail to several resorts, including Rocking Horse Ranch, 1000 Acres Ranch and Splashdown Beach.
A&G Real Estate Partners has been retained to run the sale. Andrew Jacobs, A&G's head of real estate sales, said the firm will price and market each asset individually rather than offering the portfolio as a single block.
The sale is unfolding under heavy legal pressure. The U.S. Department of Justice filed a lawsuit this week alleging the brothers concealed relationships among their companies to improperly obtain $13M in pandemic-era Paycheck Protection Program loans. The family's earlier platform, Simad Holdings, defaulted on about $214M in Israeli bonds after the brothers reportedly transferred $34M to other entities without approval and could not recover the money.
Simad operated roughly 30 for-profit summer camps and was placed into bankruptcy earlier this year. Most of its assets have already been sold, with 22 camp sites fetching $368M at auction — about 7% above appraised value — and Camp Mohawk in White Plains, New York, selling to FitzWalter Capital Partners for $120.8M, well above a stalking horse bid from Warner Bros. CEO David Zaslav of $80M.
What the Damis Liquidation Means for Buyers and Creditors
Why Damis Holdings Is Being Sold Asset by Asset
A&G's individual-asset strategy is a direct response to a sprawling, mixed portfolio. The 50 properties include office, industrial, multifamily and retail space across 22 states, plus resorts whose operating economics differ sharply from income-producing real estate. Marketing each asset separately allows buyers to underwrite local rental markets, capital needs and occupancy rather than taking on a single distressed portfolio with shared liabilities. It also reduces the chance that weaker assets drag down pricing for stronger ones.
Legal Claims Add Complexity to Every Bid
The sale is not a clean bankruptcy auction. The DOJ lawsuit over $13M in PPP loans, the Israeli bond default and allegations made in court over transfers of $34M will force buyers to conduct unusually detailed diligence on corporate relationships, liens and potential clawback exposure. The 1000 Acres Ranch typifies the problem: court records cited by Bisnow state the property was already in default with a merchant cash advance lender when bankruptcy was filed, its bank account was allegedly swept to a negative balance in June, and the resort needs more than $1M per season to operate.
Camp Auction Shows Strong Demand for Well-Located Assets
The earlier Simad camp sale is an important precedent. Twenty-two sites sold for $368M, or 7% above appraised value, with private equity firms, operators and even parents of campers bidding. Camp Mohawk in White Plains sold for $120.8M, far above David Zaslav's $80M stalking horse bid. That suggests distressed pricing does not automatically mean weak pricing for operational assets with real underlying value — but each Damis asset will still have to clear its own legal and operational hurdles.
What Distressed Buyers Should Scrutinize in the Damis Sale
Buyers, lenders and operators evaluating the Damis assets should focus on the specific risk and pricing signals in this case.
- Get the sale list from A&G Real Estate Partners and underwrite each asset against local market data for its class — office and retail carry different tenant risk than multifamily and resorts.
- Review the court record for any target resort, especially 1000 Acres Ranch, where the lender allegedly swept the account and the property needs more than $1M per season in working capital.
- Build legal diligence time into any bid because the DOJ's $13M PPP lawsuit and the alleged $34M transfers may create claims, liens or clawback risk that can outlast a closing.
- Use the Simad camp auction as a pricing reference: 22 sites sold for $368M, 7% above appraised value, suggesting competition may be strong for operational assets like camps and resorts.
- Do not assume a single portfolio discount; A&G has said it will price each property on its own terms, so pricing expectations should vary by asset quality, occupancy and local demand.
Risk & Opportunity Assessment
| Commercial Risk | High | The sale is embedded in multiple bankruptcy proceedings, a default on $214M in Israeli bonds, a DOJ claim over $13M in PPP loans and lender allegations such as a swept account at 1000 Acres Ranch; these factors can delay closings or reduce net proceeds. |
| Competitive Risk | Medium | The earlier Simad camp auction drew private equity, operators and parents and produced $368M, or 7% above appraised value; competition could lift pricing on strong assets while weaker or legally burdened assets may draw fewer bids. |
| Regulatory Risk | High | The DOJ lawsuit over the PPP loans and the ongoing bankruptcy court oversight create direct legal and clawback risk for the sale process and for buyers acquiring assets from the Shabsels entities. |
| Reputation Risk | Medium | Allegations that the brothers concealed company relationships and transferred $34M without approval have damaged trust with bondholders and regulators, though A&G's third-party sale process may limit further damage. |
| Technology Disruption | Low | No technology shift is central to the story; the portfolio consists of conventional real estate and resort operations. |
| Commercial Opportunity | High | Roughly 50 properties across 22 states and several resort assets, combined with strong demand in the prior camp auction, create a large pipeline of distressed acquisition opportunities, especially for operators and private equity with turnaround capital. |
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