More owners sue Chateau Beach developers, contractors over explosion

Miami /
Dec.December 08, 2016 01:30 PM

Two additional unit owners are suing the developer, contractor and a subcontractor of Chateau Beach Residences, a luxury condo tower completed last year in Sunny Isles Beach, seeking millions of dollars in damages tied to a gas explosion on the top floor of the building last year.

Arer Investments LLC and Saltwater Trading Corp. filed the suit in Miami-Dade Circuit Court on Wednesday against Chateau Beach LLC, Coastal Construction of South Florida and Professional Plumbing, according to a copy of the complaint obtained by The Real Deal.

They allege that the explosion, which injured six in October 2015, has damaged the value of their units and the 34-story image of the building, referred to in the lawsuit as “Chateau Boom.” Chateau Group delivered the project at 17475 Collins Avenue a month before the explosion, and following the incident, the city of Sunny Isles Beach revoked the condominium tower’s certificate of occupancy. The building continued to be “unsafe for occupancy” while repairs were being made until June 2016, according to the lawsuit.

Arer Investments, a Delaware company, paid $5.7 million for unit 2201, while Saltwater Trading Corp., a Delaware corporation controlled by Silvino Faustino Medeiros Neto, paid $2.6 million for unit 1503. Both entities allege that the eight-month period when they couldn’t access the building coupled with the “complete loss of value of the units” caused them to incur almost $10 million in combined damages.

Lana M. Naghshineh, an attorney for the plaintiffs, told TRD it would be difficult for her clients to sell their units now that the building is “stigmatized” by the explosion and subsequent effects. A final certificate of occupancy has not been issued, she said. “All of the unit owners in the building have been affected.”

In August, the owners of units 1103, 1003 “and all similarly situated unit owners” also sued the developer and Coastal over nearly identical allegations.

Naghshineh said the developers have been helpful, but called their settlement offers insulting. “Forty thousand [dollars] here or there is not going to compensate someone who paid so much for their unit,” she told TRD.

Sean Murphy, co-president of Coastal Construction, said through a spokesperson that the company has not had a chance to review the complaint in detail. “At the present time, the building has been fully repaired, has passed all inspections, and is occupied and fully operational,” Murphy said.

The Chateau Group, led by Manuel Grosskopf, did not immediately respond to a request for comment. Chateau completed Fendi Chateau Residences in Surfside in September.

“My clients don’t want this to go on for years,” Naghshineh said. “They’re reasonable people.”


Related Articles

arrow_forward_ios
Jon Paul Pérez and Gil Dezer with Residences by Armani/Casa
Related, Dezer report nearly $1B sellout at Residences by Armani/Casa
Related, Dezer report nearly $1B sellout at Residences by Armani/Casa
An aerial of the proposed development site and warehouse with Sergio Rok and Jimmy Tate
Neighbor sues to short-circuit Jimmy Tate and Sergio Rok’s no-bid North Miami project
Neighbor sues to short-circuit Jimmy Tate and Sergio Rok’s no-bid North Miami project
Fuse Group Investment CEO Eyal Peretz and attorney Michael Ehrenstein (Fuse, Ehrenstein Sager, Twitter via GUT Miami)
Fuse Group acquires Security Building in downtown Miami, plans to sue WeWork for alleged lease breach
Fuse Group acquires Security Building in downtown Miami, plans to sue WeWork for alleged lease breach
The Avenue Apartments at 6220 Reese Road in Davie (Photo via Avenue Davie)
Boardwalk Properties sued for alleged racial discrimination
Boardwalk Properties sued for alleged racial discrimination
3050 Coral Springs Drive in Coral Springs; 1361 Southeast Fourth Street in Deerfield Beach and clips from the complaints. (Google Maps, District Court of Southern Florida)
SEC charges South Floridians in alleged $9M real estate scam
SEC charges South Floridians in alleged $9M real estate scam
HFZ’s Ziel Feldman with the Shore Club (Getty, Facebook via Shore Club)
HFZ Capital off the hook for $6M in failed Shore Club South Beach deal
HFZ Capital off the hook for $6M in failed Shore Club South Beach deal
(The Markers Grove Isle)
Grove Isle legal battle ending, as developer rebrands planned waterfront condo project
Grove Isle legal battle ending, as developer rebrands planned waterfront condo project
The Clevelander South Beach (Getty)
Clevelander wins lawsuit against Miami Beach over alcohol rollback
Clevelander wins lawsuit against Miami Beach over alcohol rollback
arrow_forward_ios

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

Loading...