A suit was filed in New York State Supreme Court yesterday by 45 owners of condominium apartments at Rector Square, a 304-unit building at 225 Rector Place in Battery Park City, against YL Real Estate Developers, Michael Shvo and Cooper Square Realty.
Mr. Levy had acquired the former rental building, which had been known as Park Place, from Related Companies in 2006 for $165 million. The transaction that also included Columbus Green, a rental building that was converted to a condominium known as Park Columbus at 101 West 87th Street.
Earlier this year, Anglo Irish Bank foreclosed on the Battery Park City property.
Mr. Shvo is a real estate broker who was involved in sales at the building and Cooper Square managed the building.
According to an article by David Jones in today's edition of therealdeal.com, the suit charges that YL Real Estate Developers, which is headed by Yair Levy, failed to complete promised construction, failed to make payments to the Battery Park City Authority and diverted reserve funds for Mr. Levy's own use.
The suit also charges it, Mr. Shvo and Cooper Square with fraud, negligence and misrepresentation, according to the article.
The suit also alleged that in violation of the authority's regulations, Mr. Levy sold some apartments to an Italian university for dormitory use by exchange students and rented out apartments to Marriott as extended-stay hotel rooms.
The building was erected in 1986 by Related Companies and designed by Sampton Gruzen Steinglass.
Related had received tax breaks when it erected the building in exchange for making 20 percent of the units available for moderate-income tenants and in 2002 Related extended that protection to the year 2019 as an inducement for people to stay in the building after the terrorist attacks of September 11, 2001 as it was one of the closest in Battery Park City to Ground Zero.
After paying off a mortgage of the Housing Finance Agency, Mr. Levy argued that the provision of rent controls for the moderate-income units no longer applied. While most of the market-rate tenants in the building vacated as their leases expired, the tenants in the moderate-income units remained.
Mr. Levy had acquired the former rental building, which had been known as Park Place, from Related Companies in 2006 for $165 million. The transaction that also included Columbus Green, a rental building that was converted to a condominium known as Park Columbus at 101 West 87th Street.
Earlier this year, Anglo Irish Bank foreclosed on the Battery Park City property.
Mr. Shvo is a real estate broker who was involved in sales at the building and Cooper Square managed the building.
According to an article by David Jones in today's edition of therealdeal.com, the suit charges that YL Real Estate Developers, which is headed by Yair Levy, failed to complete promised construction, failed to make payments to the Battery Park City Authority and diverted reserve funds for Mr. Levy's own use.
The suit also charges it, Mr. Shvo and Cooper Square with fraud, negligence and misrepresentation, according to the article.
The suit also alleged that in violation of the authority's regulations, Mr. Levy sold some apartments to an Italian university for dormitory use by exchange students and rented out apartments to Marriott as extended-stay hotel rooms.
The building was erected in 1986 by Related Companies and designed by Sampton Gruzen Steinglass.
Related had received tax breaks when it erected the building in exchange for making 20 percent of the units available for moderate-income tenants and in 2002 Related extended that protection to the year 2019 as an inducement for people to stay in the building after the terrorist attacks of September 11, 2001 as it was one of the closest in Battery Park City to Ground Zero.
After paying off a mortgage of the Housing Finance Agency, Mr. Levy argued that the provision of rent controls for the moderate-income units no longer applied. While most of the market-rate tenants in the building vacated as their leases expired, the tenants in the moderate-income units remained.
Architecture Critic
Carter Horsley
Since 1997, Carter B. Horsley has been the editorial director of CityRealty. He began his journalistic career at The New York Times in 1961 where he spent 26 years as a reporter specializing in real estate & architectural news. In 1987, he became the architecture critic and real estate editor of The New York Post.
6sqft delivers the latest on real estate, architecture, and design, straight from New York City.
