The Real Deal Miami

Phillipe Starck’s design firm sues Related Group over an alleged breach of contract in Mexico

May 21, 2013 06:00PM
By Emily Schmall

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Phillipe Starck

UPDATED, 9:15 a.m., May 22: The design firm of French architect Phillipe Starck has sued Miami-based Related Group and an affiliate company in Mexico alleging a breach of contract over a condo development on Mexico’s Pacific coast.

London-based Yoo claims Starck, the company’s creative director, was contracted to “develop a design philosophy and overall concept” for three luxury condominium towers in the Mexican resort town of Puerto Vallarta, to be known as Icon Vallarta. The development was the third in a series of collaborations between the architect and the Related Companies, co-founded by developer Jorge Pérez and Miami Dolphins’ owner Stephen Ross, following the construction of the Icon Brickell and Icon South Beach towers.

According to a 2006 agreement attached to the complaint, Related would pay Yoo a fee of 1.75 percent of the net sale price of each condo unit within five days of a closing and 2 percent of gross rental or letting fees.

By April, nearly four years after Starck completed the Icon Vallarta’s design, some 228 of the development’s 343 units had been sold, netting $122.5 million in sales.

In the complaint filed May 1 in Miami-Dade County circuit court, Yoo alleged Related “refused” to pay the company a balance due of $708,559.60 plus compounded interest of 1 percent per month.

The disputed fees center on “an active controversy” over the interpretation of the agreement’s apportionment provision, the complaint said. Yoo requested the court end the stalemate by issuing a declaratory judgment.

“Related partnered with Philippe Starck in an effort to tap into his design star power and carve out a competitive advantage in the market, but now doesn’t seem to want to pay for it,” said Yoo’s attorney, Alan Kluger of Kluger Kaplan Silverman Katzen and Levine. “Yoo by Philippe Starck added significant value to the project and should be compensated as outlined by the contract.”

Starck is designing a $300 million SLS-brand condo-hotel tower in Brickell co-developed by Pérez and Los Angeles nightclub entrepreneur Sam Nazarian, as The Real Deal reported in March.

Related did not respond to a request for comment by deadline.

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