Mendel Brach, a Brooklyn developer, has been fined $10.9 million and prohibited from selling apartments in New York State after taking advantage of a zoning loophole to build structurally unsound, oversized condominiums. The condos in question, on Spencer Street in Bedford-Stuyvesant, are part of a 72-unit development for which Brach obtained approval to build nine stories tall in 2002. Typically, the neighborhood’s zoning laws allow buildings to be five stories, maximum, but because Brach’s application said local yeshiva faculty members would live there, he was granted an exception. When all units were sold on the open market, and none to yeshiva faculty, Brach’s plan unraveled. The city refused to issue a permanent certificate of occupancy for residents, and fees mounted for numerous building code violations. Under a settlement between Brach and the attorney general’s office, which will soon be filed in court, his $10.9 million fine will go toward repairing structural defects in the building. If he complies with all of its terms, Brach can try to regain his real estate privileges in five years’ time. [NYT]

Developer Mendel Brach was served with a subpoena last week to collect on a $10.9 million judgment after he allegedly failed to complete necessary repairs and obtain a certificate of occupancy at his troubled Spencer Street condominium project in the Bedford-Stuyvesant section of Brooklyn. Attorney General Andrew Cuomo filed suit in July alleging that Brach, starting in 2003, fraudulently sold condominium units to the general public after obtaining a zoning variance for religious studies. The suit also alleges the 72-unit development is saddled with $8.9 million in construction defects, including leaks, mold, unsound walls and electrical problems. [more]