The Real Deal New York

Shvo, Boymelgreen named in suit against 20 Pine Street

August 19, 2008 01:07PM
By David Jones

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Developer Shaya Boymelgreen and marketer Michael Shvo are facing a lawsuit from a Brooklyn-based buyer that alleges they exaggerated sales figures and completion dates at 20 Pine, The Collection, and then refused to rescind a contract to buy 10 apartments.

The suit, filed last month by 20 Pine Realty in New York State Supreme Court, alleges that 20 Pine Realty entered an agreement to buy 10 condo units at 20 Pine Street in January 2006 and deposited $819,500 to hold the apartments.  

20 Pine Realty lists its location at 519 Flushing Avenue in Brooklyn. The New York Secretary of State’s records do not list any principals at the firm, which organized as a limited liability corporation in January 2006.

The plaintiff’s lawyer, Yoram Nachimovsky, could not be reached for comment.

The suit claims that the plaintiff tried to walk away from 20 Pine Street during the initial seven-day rescission period, but was turned down and was told the building would still be completed on schedule.

The suit alleges that Boymelgreen told the plaintiff that hard contracts had been signed for 140 of 409 apartments, that nearly all the purchasers were planning on living in the building and that the entire building would be ready for occupancy by January 2007.

The plaintiff claims that by the end of 2007, it attempted to contact Shvo and the developer regarding the status of 20 Pine Street, but was ignored.

“The principal indicated that he was having problems with his primary investor and would no longer honor his commitments to the plaintiff,” the suit alleges.

The suit also claims that an agreement was reached to close on the apartments by July 1, but agents for Boymelgreen refused to offer the sponsor a chance to inspect the apartments. He also claims he was told that lenders would not provide financing for the purchases and that he would not be able to place tenants in the apartments without prior approval.

The plaintiff claims that he suffered more than $2 million in losses due to delays.

In a counterclaim filed earlier this month, attorneys for Boymelgreen and 20 Pine Street allege that the developer was ready to close on the apartments and that the plaintiff tried to rescind the contracts “without sufficient cause and justification.”

A spokeswoman for Shvo declined comment on the case. Boymelgreen and attorneys for 20 Pine could not be reached for comment.

20 Pine has been one of the highest-profile condo developments in Lower Manhattan since Boymelgreen teamed up with Armani/Casa in 2006 to convert the former Chase Manhattan headquarters into luxury condominiums.

City records show that the first apartments closed in April, with Deutsche Bank executive Christopher Beaudet buying unit 2706 for $1.32 million.

Court records show that a judgment in state Supreme Court in May ordered the developers to refund a deposit of $229,500 plus interest to Jamilah-Nadeh Holdings after 20 Pine Street officials failed to appear at a closing.

In June, Cooper Square Realty was named as the management company for 20 Pine.

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