The Real Deal New York

Laurel developer sued over rent

June 05, 2009 11:36AM
By David Jones

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alternate textAlexico is the subject of litigation for its Laurel condo at 400 East 67th Street (left). The off-site sales office at St. Tropez, 1161 First Avenue.

Alexico Group is facing litigation after it allegedly failed to pay $254,000 in back rent and other charges for an off-site sales office at the Laurel, its 31-story condominium building at 400 East 67th Street.

Since 2007, the Manhattan-based development marketing firm has operated the Laurel sales and design center at 1161 First Avenue, which is a street-level commercial space located at the rival St. Tropez condo, on the corner of 64th Street.

The complaint, filed by the St. Tropez Board of Managers May 27 in New York Housing Court, alleges the developer — which pays $53,571 per month in rent — failed to make a payment since January. Alexico, led by Izak Senbahar and Simon Elias, told the landlord that slow sales at the Laurel were hurting its ability to make rent payments for the sales office, according to St. Tropez’s attorney.

“The reason they’re not paying their rent is because they can’t sell any units [at the Laurel],” said Adam Leitman Bailey, attorney for the St. Tropez. “Their lease expires Sept. 30. They’ve asked to be let out of their lease.”

Alexico officials, however, have a different take on the situation.

“The dispute relates to, among other things, space the condominium board arbitrarily annexed without our consent or any advance notification,” according to an Alexico spokesperson, who asked not to be named.

He claimed the St. Tropez expanded a health club into the sales office space without prior consent, and that there were other problems, including flooding, in the building. He declined to comment when asked why Alexico never took the landlord to court over these alleged problems, but said there would likely be new litigation.

“We are very clear that our actions relate to negligence on behalf of the board and have absolutely nothing to do with the viability of the Laurel,” the spokesperson said.

Howard Grun, attorney for the sponsor, denied ever making any statement about sales at the Laurel. He said he was not aware of the sales situation at the Laurel, and would not be able to comment on the building’s sales.

Records from the city Department of Finance show 34 recorded sales at the Laurel, which offers 129 units ranging from $695,000 for a studio to $4.95 million for a two-bedroom. It is not immediately clear how many apartments remain under contract.

According to Streeteasy.com, the building has 27 apartments listed for sale with prices ranging from $875,000 for a 496-square-foot studio up to $13 million for a 4,073-square-foot penthouse. In addition, 11 units are listed for rent at prices ranging from $3,900 a month for a studio, up to $13,500 for a 1,773-square-foot three-bedroom.

Corcoran Sunshine Marketing Group, the exclusive broker for the Laurel, has operated a new on-site sales office at the Laurel since earlier this year.

As for the previous sales office, Manhattan-based retail brokerage Robert K. Futterman & Associates, is listing the 7,300-square-foot space for occupancy starting October 2009. The space includes 5,800 square feet on the ground floor and 1,500 square feet in the basement. Asking prices were not available, and the broker referred inquiries to the St. Tropez.

The suit follows a similar complaint filed in March by Brant Publications, which is seeking $65,000 from Alexico after the developer failed to pay for advertisements for its 56 Leonard Street condo in the publisher’s Interview and Art in America magazines. Mark Diller, attorney for Brant, said the lawsuit has been settled, but did not elaborate.

In a January interview with Marquis Who’s Who, Louise Sunshine, the founder of Corcoran Sunshine Marketing Group and development director at Alexico, said that 56 Leonard was delayed due to the inability to get financing.

Alexico has several major projects, including a multimillion dollar renovation of the Mark Hotel, at 25 East 77th Street and previously announced plans for the Oliver, a luxury rental building at 959 First Avenue, between 52nd and 53rd streets.

The suit was originally filed in housing court because Alexico remained under lease at the building. Bailey said late last night that Alexico officials turned in the keys to the original sales office, which would transfer the case into civil court.

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