The Real Deal New York

Tenants at Chetrit-owned Hotel Chelsea sue for unauthorized work on historic building

By David Jones | April 08, 2013 10:00AM

Tenants at the historic Hotel Chelsea are suing the property’s ownership group, led by Joseph Chetrit, for allowing unauthorized work in March that temporarily knocked out their heat and hot water – and still has them looking for cooking gas.

The residents filed a contempt motion April 3 in New York City Housing Court, claiming the owners have violated a 2012 consent order that requires all construction at the landmark building to follow local building codes and regulations. The lawsuit names Yellow Dynasty, the ownership group, as well as Chelsea Management, Chetrit Group executives Meyer Chetrit and Michael Butler and hotel manager Lilly Sirkin as defendants. The original consent order removed Joseph Chetrit and the Chetrit Group as parties to the deal. 

Neither Chetrit Group officials nor attorney Fred Daniels were immediately available for comment.

As The Real Deal has reported, the Department of Buildings issued a stop work order on The 222 West 23rd Street property for illegal or defective gas piping. Con Edison last month blamed the gas disruption on a plumber doing unauthorized work at the hotel.

Inspectors from several agencies flooded the site after City Council Speaker Christie Quinn brought attention to the outage and mailed an angry letter to Chetrit accusing him of harassing tenants at the site, which is in her district.

The building has 152 open violations with the Department of Housing Preservation and Development, and was cited by the New York Fire Department for failing to maintain a construction site in general compliance, court papers show.

If The Housing Court sides with the tenants, the owners could be forced to repair the violations, pay legal fees and damages, and could even face fines or jail time if there are further violations, a lawyer for the tenants told The Real Deal.

“They can reorder him (Chetrit) to do the repairs that he hasn’t done under the prior situation,” said Sam Himmelstein, a partner at Himmelstein McConnel Gribben Donoghue & Joseph.

The Chetrit Group bought the property two years ago for $79 million and is converting it into a boutique hotel under the King & Grove brand, which is led by former Morgans Hotel chief Ed Scheetz; King & Grove declined to comment through a spokesperson.

The property is a unique combination of hotel rooms and rental apartments that has been home to legendary artists, writers and musicians, including poet Charles Bukowski and singer Patti Smith. Just last month, Chetrit sued former owner Stanley Bard in State Supreme Court for allegedly providing misleading information about the value of artwork at the property. Bard allowed many of the resident artists to display their works, and often used their art as rent payments.