Contractors in recent months have filed $3.7 million in liens against some of Douglas Development’s most prominent local projects. Jemal cites cash-flow issues and says he's in the process of paying his overdue bills.
Contractors have filed nearly $3.7 million in liens for unpaid bills against Doug Jemal’s projects in Western New York over the past year and a half.
It’s another indicator that high interest rates and the diminished market for office and retail space have put the screws to the developer’s business.
Jemal called those conditions “a pandemic of real estate” that have made cash flow tight for his company and real-estate developers across the country.
“There’s cash flow issues, no doubt,” he told Investigative Post. “But we’re taking care of this. We pay our bills.”
The mechanics liens — a legal tool contractors use to secure a debt by taking an interest in a piece of property — were filed against some of Jemal’s marquee projects. They include Seneca One, Buffalo’s tallest building; the iconic Statler Hotel on Niagara Square; and the redevelopment of several properties at Elmwood Avenue and Bidwell Parkway into retail space and apartments.
Paul Millstein, vice president of Douglas Development, said more than half the debts represented by the liens have recently been paid and he expects most of the outstanding debts will be resolved soon. One of the debts is the subject of a lawsuit, he said, which Douglas Development is contesting.
Jemal and Millstein said the company was unaware of some of the smaller outstanding bills until this week, when Investigative Post shared a list of active liens filed with the Erie County Clerk. Investigative Post began making inquiries about the debts in July.
“A lot of it is nickety-nackety stuff,” Jemal said, adding that the debts to smaller vendors would be paid. “We don’t want to hurt the little guy, for sure.”
In all, eight contractors have filed a total of 27 liens against Douglas Development and 15 affiliated companies since March 2024. The vast majority — about 90 percent — were filed in the last five months, a period in which Jemal has slowed or ceased work on numerous local projects, backed out of others, and sought to sell some properties in the expansive inventory he has collected since he began investing in Buffalo almost a decade ago.
Two of the eight companies that have filed liens since March 2024 were owed more than $1 million each, according to records filed with the Erie County Clerk.
Seven of the eight contractors who filed liens with the clerk’s office did not respond to phone calls and emails seeking comment. A representative for Heritage Custom Flooring, the one company that took Investigative Post’s phone call, declined to comment.
Millstein, of Douglas Development, told Investigative Post the company recently settled more than $1.6 million in debts with Industrial Power & Lighting, the biggest lien-holder.
He said they are working on a settlement with the second biggest, DV Brown and Associates, which has filed more than $1.5 million in liens since late July. The company’s most recent lien, for$32,858,was filed last Friday.
Millstein said the debts to Empire Building Diagnostics and Commercial Distribution Specialists have been paid in full; the companies simply haven’t filed paperwork with the county clerk to release the liens.
He said the $161,692 owed to Heritage Contract Flooring remains unpaid.
“That’s very late and we owe them,” Millstein said. “We are going to take care of that right away.”
The company, located in an industrial park off William Street between Fillmore and Bailey, in April filed a mechanics lien against 368 Sycamore Street, a former warehouse Douglas Development acquired in 2022. The top two floors of the property are currently occupied by the Buffalo Center for Arts and Technology.
The Sycamore Street warehouse conversion has incurred more liens than any other Jemal project — five of them filed by four companies for more than $1 million. About a quarter of that sum was owed to Industrial Power & Lighting, whose debts have been settled, according to Jemal and Millstein. The lion’s share is owed to DV Brown and Associates.
Millstein said Douglas Development is contesting just one of the debts — the one claimed by Buf DL LLC, which fixed water damage to a Jemal property on Main Street downtown.
Buf DL LLC last October filed a mechanics lien against Jemal’s Sandoro, LLC, which in 2022 bought 515 and 521 Main Street. The company filed a lawsuit against Jemal’s company in June. The company’s principal, Dion Luzzi, claims in court papers his company did $151,701.26 worth of work on the properties, for which Jemal has not paid. Jemal, through his lawyers, denied the claim.
Millstein said the water damage was caused by a water main break in the basement of the building that’s home to Misuta Chow, a restaurant in bankruptcy proceedings. He said Douglas Development has paid its share of the mitigation costs and the rest is the responsibility of the restaurant’s insurer.
Jemal’s cash-flow issues aren’t limited to Buffalo. In June he was behind $4.6 million in taxes on nearly 50 properties in Washington, D.C., where Douglas Development is based, according to the Washington Business Journal. A year ago he defaulted on a $52 million loan tied to 15 D.C. area properties, the Journal reported. He lost three properties in D.C.’s Chinatown neighborhood to foreclosure in June 2024.
Jemal said his D.C. area holdings have been impacted by the Trump administration’s policy, through Elon Musk’s Department of Government Efficiency, of canceling leases for federal government offices in D.C. in favor of cheaper digs. He said previously more than 10 percent of his D.C. business came through the federal General Service Administration.
He said his Western New York property portfolio is sustainable on its own — it doesn’t depend on cash flow from his holdings in D.C. or elsewhere.
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Buffalo Business First last year cataloged57 Western New York properties owned by 33 limited liability corporations controlled by Douglas Development. Most are in the City of Buffalo.
Jemal recentlybacked out of his role as developer of the Richardson complex. He’strying to sell the former Mahoney state office building on Niagara Square and said he’s “open to suggestions” on other properties as well.
“Obviously, I don’t want [properties] to sit there,” he said. “It’s a drain on your cash flow. If you’re not doing anything with it, and you’re not able to get bank financing, I’ll sell it.”
His redevelopment of theStatler Hotel is at a standstill. Jemal said he needs to find $35 million in financing to match the $35 million equity he has in the Statler project to continue the renovations.
He blamed high interest rates, as well as federal regulators instructing banks to increase the reserves they hold against the risk of mortgage defaults. Ironically, he said, the tight lending environment risks pushing highly leveraged real-estate developers like himself into default.
“This isn’t a Douglas [Development] issue. This is an everyone issue,” he said. “Everyone has given some properties back. It’s a pandemic of real estate at the present time.”
posted 10 minutes ago - September 10, 2025