LeFrak settlement over scorching and freezing apartments adds up to $42M

Tenants accused LeFrak of neglecting repairs that made climate control in their homes almost impossible

New York /
Dec.December 18, 2019 05:40 PM
Gateway Plaza and Richard LeFrak (Credit: Getty Images)

Gateway Plaza and Richard LeFrak (Credit: Getty Images)

After nearly five years of litigation, LeFrak has reached a hefty settlement with tenants at a Battery Park City complex.

LeFrak, the third-largest rental landlord in the city, agreed to a three-part benefits package worth $42 million at Gateway Plaza, court documents show. The class action suit, filed in 2014, accused an entity controlled by LeFrak of neglecting heating repairs in the massive residential complex, which encompasses six 34-story buildings with 1,712 apartments across about 1.9 million square feet.

The landlord’s inaction let outside air flow freely into the Gateway Plaza apartments, exposing residents to extremely cold temperatures during the winter — with ice forming on windows — and extremely hot temperatures during the summer, according to the lawsuit. Residents were forced to use “various self-help measures” to stop the outside air from coming in, including “duct tape, plastic sheeting, towels and pillows,” the tenants’ law firm Newman Ferrara wrote in 2014, when the class action suit was filed.

LeFrak, a major property owner led by CEO Richard LeFrak, ignored complaints about these conditions for years, according to the law firm. The suit originally sought $100 million.

The settlement with LeFrak is split between $10 million in cash and rent abatements for tenants and $13 million in contractual rent increase limitations and $18 million to $20 million for repairs and improvements largely completed by August 2017, according to court documents. There will be a hearing about the settlement on March 2 to determine whether it should be officially approved.

Representatives for LeFrak and Newman Ferrara attorney Lucas Ferrara both declined to comment. LeFrak admits no wrongdoing in the settlement.

By The Real Deal’s count, LeFrak has 12,111 rental units across 85 buildings in New York City. Its crown jewel is the 40-acre LeFrak City complex in Queens.


Related Articles

arrow_forward_ios
Jeff Winick (Getty)
Jeff Winick sued by IRS for not paying taxes
Jeff Winick sued by IRS for not paying taxes
(NYC Housing Authority, Google Maps, iStock)
Navillus seeks bankruptcy protection from NYCHA lawsuit
Navillus seeks bankruptcy protection from NYCHA lawsuit
From left: Mathew Chapman, Michele Kowal, Maryanne Elsaesser and Rhonda Battifarano (NJ Home Navigators)
Christie’s affiliate in NJ sues Compass for poaching, stealing trade secrets
Christie’s affiliate in NJ sues Compass for poaching, stealing trade secrets
The curious case of the vanishing attorney
The curious case of the vanishing attorney
The curious case of the vanishing attorney
Abraham Edgardo Ortega is one of nine people charged in the laundering scheme. (Getty, Department of Justice)
Former Venezuelan oil exec sentenced in $1B money laundering scheme
Former Venezuelan oil exec sentenced in $1B money laundering scheme
Ira Drukier with the Hotel Chelsea (Getty, Patrick McMullan/Getty)
Chelsea Hotel owners sue city for $100M over renovation delays
Chelsea Hotel owners sue city for $100M over renovation delays
RSA's Joseph Strasburg and Judge Lawrence Marks (Getty, Strasburg via Jeffersons Siegel)
Landlord group challenges state eviction ban
Landlord group challenges state eviction ban
RXR Realty's Scott Rechler with 75 Rockefeller Plaza (Getty, David Shankbone/Wikimedia)
RXR Realty serves American Girl with a lawsuit
RXR Realty serves American Girl with a lawsuit
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...