The Real Deal New York

AG sues developer over alleged defects at Williamsburg condo

Schneiderman seeks $1.4 million and ban on Yitzchok Schwartz’s developments

May 02, 2012 04:30PM
By Leigh Kamping-Carder

From left: 57-59 Maspeth Avenue, New York State Attorney General Eric Schneiderman

New York Attorney General Eric Schneiderman is seeking nearly $1.4 million from the developer of a 17-unit Williamsburg condominium project that is allegedly “rife with construction defects,” including leaks, faulty windows and the use of flammable material on the roof, according to court documents obtained by The Real Deal.

“Condominium purchasers were defrauded by a developer who chose to cut corners at the expense of people’s safety,” Schneiderman said in a statement to The Real Deal.

Schwartz, who also helped develop Williamsburg’s Warehouse 11 condo, could not immediately be reached for comment. Calls to a business at the same address as Maspeth Plaza and with a number for a Yitzchok Schwartz who lives in Williamsburg were not immediately returned.

Unit owners hired an engineering firm in January 2011 to evaluate the alleged defects, and the firm discovered an estimated $1.2 million worth of damage, ranging from improper roof installation, to “moisture penetrations” in the façade, to air and water seeping through the windows and balcony doors, the suit says.

When an engineer with the AG’s office conducted his own examination, he found additional unsafe conditions, including an unvented garbage room and “illegal and highly combustible” decking material used on the roof, the suit says.

Schneiderman is seeking $1.3 million in payback for unit owners – to cover the alleged damage and $75,000 in legal and professional fees – as well as an $85,000 penalty that would go to the state, and an order that would effectively permanently ban Schwartz from selling condos in New York State.

“We are seeking restitution for the purchasers who were ripped off, in addition to strong penalties for the developer who defrauded them,” Schneiderman said.

Units at 57-59 Maspeth featured the requisite granite countertops, stainless steel appliances and hardwood floors, and spanned between 600 and 1,900 square feet, according to past listings. Many also came with outdoor spaces.

Disgraced architect Robert Scarano served as the project’s architect, Department of Buildings records show.

Though no units are currently on the market, past sales prices have ranged from about $404,000 to $763,000, according to Streeteasy.com. The project was initially marketed by the Developers Group, now known as MNS.

One of the units where the engineer found roof leaks was No. 5A, which sold for $799,000 in December. The listing agent, Rafael Malka, a sales agent at Prudential Douglas Elliman, declined to comment.

Schwartz has made headlines in the past for his work on Warehouse 11, the 120-unit, Karl Fischer-designed building at 214 North 11th Street. Yitzchok and his co-developer, Isack Rosenberg, defaulted on a $50 million mortgage at the property and held a “fire sale” of units while battling lender Capital One in bankruptcy court.

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