The Real Deal New York

Real estate investor sues Toren condo board

In a lawsuit, Michael Salzhauer says the group is purposely concealing its books

August 31, 2016 04:20PM
By E.B. Solomont

Correction: An earlier version of this article misidentified the plaintiff as Miami plastic surgeon Michael Salzhauer, who shares the same name as the plaintiff and is his cousin.

UPDATED on Wednesday, Aug. 31 at 5:35 p.m.: Benjamin Partners’ Michael Salzhauer is suing the board of the Toren Condominium in Downtown Brooklyn to give him a look at the books, alleging that it’s gone to “great lengths” to conceal critical documents, including its budget, financial statements and details of a 2015 settlement with the project developers.

The suit, filed in New York Supreme Court on Wednesday, claims the board’s legal settlement with Don Capoccia, Joseph Ferrara and Brandon Baron of BFC Partners contains details related to “building-wide design and construction defects,” and requires BFC to repair the building at 150 Myrtle Avenue.

Salzhauer, a principal at the commercial real estate firm, is the largest commercial tenant at the Toren, having paid $6.75 million for a 10,976-square-foot retail condo in 2013. The building has 240 apartments, including 42 moderate-income units. Among the Toren’s market-rate condos, one-bedrooms are priced around $650,000 and two-beds are priced around $1.4 million, according to StreetEasy.

In court documents, Salzhauer said the board had engaged in “unlawful and underhanded” efforts to marginalize and silence him by refusing to turn over the settlement agreement and financial statements “without any legitimate justification.” The board also refuses to hold regular meetings, and has singled him out by demanding he sign an “unreasonable” confidentiality agreement if he wants to see the books.

The board sued the condo developers in 2011, charging that the building violated certain New York City building codes and that design flaws had led to leaking and water damage.