Elegran revealed as creator of fake building websites

<i>TRD</i> Investigation: Nearly 100 fake building sites were registered to lead-gen brokerage's Michael Rossi or his associates

Elegran founder and CEO Michael Rossi, and a segment of the domain registry history for timewarnercentercondos.com
Elegran founder and CEO Michael Rossi has a direct connection to a network of copycat building websites

Top executives of Elegran Real Estate are the masterminds behind a sprawling network of copycat lead-generation websites, an investigation by The Real Deal has found.

When TRD first exposed a sprawling network of sites for New York luxury residential buildings in May, the identity of those operating the websites remained a mystery thanks to domain registration privacy services. The sites, masquerading as the official websites for high-end developments such as the Time Warner Center, The Park Imperial and the Trump World Tower, generated leads from potential buyers. Elegran, a lead-generation brokerage founded and run by Michael Rossi, was the only firm confirmed to be receiving leads from the network, but the investigation had otherwise hit a dead end.

At the time, Rossi thanked TRD for bringing these shady websites to his attention, adding that the brokerage was in the process of “vetting the transparency and compliance of our lead generation sources.” But tools provided by cyber intelligence firm SecurityTrails have now made it possible to uncover additional information about many of these websites. The new information reveals a direct connection to Elegran, its leader and some of its top executives.

With the help of SecurityTrails, TRD examined historical domain registration records for all 273 previously-identified websites in “The Network.” For 95 of those domains, records show an Elegran executive as the website’s administrative contact at some point in the past.

Although the websites’ current registrations are shrouded in anonymity, it appears that the registrants were less careful about covering their tracks early on — and well, the internet is forever.

The most frequently used name, which appears 79 times for websites such as timewarnercentercondos.com and sherry-netherland-hotel.com, is that of Rossi himself.

Rossi declined to comment on Elegran’s current or prior relationship with the websites, citing guidance from his legal counsel. He said he is preparing to file a lawsuit within a week, but declined to elaborate on the nature of the lawsuit or who he’d be bringing it against.

“I’m in a really tough spot,” he said. “If the article comes out in a way that really smears the company, there’s the potential that I lose a big chunk of the company and I wouldn’t be able to sustain it.”

Meanwhile, Elegran CFO Tamás Hoffmann’s name appears 10 times, and chief marketing officer Mihkel Noormägi appears six times, twice under the pseudonym “Michael Youngberg” (in Noormägi’s native tongue, Estonian, “noor” means “young” and “mägi” means “mountain”).

Reached by phone via a number listed in these records, Hoffmann denied any knowledge of the websites, saying that his role at Elegran is only to manage the company’s finances.

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And it’s not just names. One of the most common phone numbers in the registration records is Elegran’s current company phone number, and Elegran’s former office at 353 Lexington Avenue is frequently used as a contact address. Many of the websites registered under Rossi’s name use an email address associated with Hoffman or Noormägi, such as youngbergnyc@gmail.com.

Noormägi could not be reached for comment by phone, and did not respond to an email. According to Crunchbase, Noormägi has co-founded two other startups with Rossi — RealMailers, a mail automation and targeting service for real estate brokers, and Tenant King, a super-local social networking platform for buildings and neighborhoods.

Elegran was named Inman’s most innovative residential brokerage in 2017, and appeared at no. 20 on TRD’s February ranking of Manhattan brokerages by closed sales, with $56 million in closed sales over 38 deals.

It touts itself as a residential brokerage that obsessively deploys new technologies such as machine learning and proprietary technology to feed solid leads to its agents. In a 2017 interview, Rossi said that new agents at Elegran relied most on online leads, which account for roughly 40 percent of the firm’s transactions.

The latest findings raise questions as to whether Elegran violated New York real-estate advertising laws while operating in the lightly regulated world of lead generation. According to New York Real Property Law, the Department of State has the authority to suspend or revoke a real estate broker’s license “for dishonest or misleading advertising,” as well as “untrustworthiness or incompetency to act as a real estate broker or salesman, as the case may be.” It was previously unclear if the DOS had jurisdiction over the Network’s operators, but a direct connection to Elegran, a New York-based company, may change things.

A Department of State spokesperson said that the agency “is looking into the matter.”

Elegran has recently found itself in hot water for its connection to other lead-generation websites as well. According to documents reviewed by TRD, residential brokerage Citi Habitats in January filed a complaint with the Real Estate Board of New York against Elegran over two websites, newconstructionmanhattan.com and luxuryrentalsmanhattan.com, which it says displayed Citi Habitats’ exclusive listings without its permission.

In the complaint, Citi Habitats alleges that Elegran controlled the websites, and failed to take down the listings after being asked to. At a hearing, Rossi denied ownership or control of the two websites, but added that he “instructed the Websites’ owner to ensure compliance with any relevant REBNY rules or regulations.” On April 12, REBNY censured Elegran for failing to abide by the Board’s Code.

REBNY said it doesn’t comment on ethics cases, and Citi Habitats did not respond to a request for comment.