A 10,687-square-foot estate in Bridgehampton awarded to Libbie Mugrabi in her divorce settlement drew a $5.86 million bid at a public foreclosure auction outside Southampton Town Hall, according to the New York Post. The bid does not by itself mean the sale has closed: the winning bidder has 30 to 45 days to complete the purchase, the Post reported.
The result leaves the property’s final ownership and possession unresolved. The auction followed a default on a reported $3.5 million loan and an earlier foreclosure sale in which an affiliate of Great Neck lender REO Assets of America acquired the roughly seven-acre property for $500, according to the Post.
A distressed sale in a strong market
The auction price is difficult to compare directly with ordinary Bridgehampton transactions because foreclosure sales can reflect unresolved debt, legal costs, possession questions and the risk that a buyer may not obtain the property immediately. Mugrabi had reportedly sought as much as $25 million before reducing the asking price to $19 million, while the Post reported that accumulated mortgage debt, penalties and legal fees exceeded $9 million.
The broader East End market was not showing the same pricing conditions as this distressed sale. Corcoran reported that median and average prices in Bridgehampton and Sagaponack each rose 86% year over year in the first quarter of 2026, while the East End luxury-market average increased 16% to $14.977 million. Those figures included a small number of very high-value transactions and are market benchmarks, not appraisals or comparable sales for the foreclosed estate, according to Corcoran.
How the property reached the auction
The foreclosure process followed Mugrabi’s 2020 divorce from art collector David Mugrabi. She received the Bridgehampton property in the settlement and later said the overall package was worth $100 million, a figure the Post described as unverified. Avenue Magazine reported that she sought to reopen the divorce in 2021, alleging that her former husband had sent her damaged artwork; those divorce-related claims are separate from the mortgage proceedings. The family’s art business includes an offshore collection of more than 1,000 Andy Warhol works, according to Avenue Magazine.
After the earlier $500 foreclosure purchase, a proposed settlement reportedly gave Mugrabi about two and a half months to sell the home publicly, with an August 25, 2026 deadline. When that effort did not produce a completed sale, the lender proceeded with the later auction, the Post reported. The immediate open question is whether the $5.86 million bidder completes the transaction within the stated period.
The foreclosure backdrop
The case is a property-specific dispute, not evidence by itself of a new foreclosure trend in Suffolk County. A March 2019 report from the New York State Office of the State Comptroller said that both new foreclosure filings and pending foreclosure caseloads had fallen during the period it examined. By 2018, foreclosure cases represented 18% of New York Supreme Court civil cases, or fewer than one in five, according to the comptroller’s report. That statewide historical context does not establish current conditions in Suffolk County or explain the value of this particular estate.
For now, the auction has produced a reported bid rather than a completed transfer. Whether the buyer pays the balance, receives title and takes possession will determine whether the foreclosure saga ends with a sale—or proceeds into another stage of litigation and enforcement.
