Ray Dalio’s penthouse project hit with new stop-work order

In Soho, David claims to have beaten Goliath.

Well, “David” is a bit of a stretch to describe Federico Pignatelli della Leonessa: He is a financier, comes from Italian nobility and founded Pier 59 Studios. But his fortune pales in comparison to that of his neighbor, Ray Dalio, owner of the world’s largest hedge fund, Bridgewater Associates.

For two years the pair have been locked in a dispute over Dalio’s construction of a penthouse, deck and pergola rising up to 15 feet over the rooftop at 468 West Broadway, a co-op where the two have neighboring apartments.

Pignatelli claimed the construction damaged his unit and the structural integrity of the building. In May, his story found its way into the New York Times.

Now he is celebrating a second stop-work order issued by the Department of Buildings, 16 months after the agency initially halted Dialo’s nearly finished project.

Predictably, the two men have very different interpretations of the order. Because it mentions safety concerns, Pignatelli views it as a condemnation by the city. Dialo’s camp calls it a technicality.

The argument stems from Pignatelli’s belief that the design and weight of Dalio’s addition is crushing the apartments below it, including his. The Department of Buildings has not said that, but did suspend the project in May 2022.

Building inspectors visited 468 West Broadway that month to investigate a report of construction contrary to what had been approved. The agency validated the complaint, ordered the work stopped and notified Dalio that it intended to revoke the project’s permits.

“The applicant initially notified the Department that they are working to resolve the audit. However, ultimately they failed to do so,” an agency spokesperson said in a statement. “Since they never resolved the audit, DOB revoked the permit.”

With no active permit in place, the Department of Buildings in September issued the second stop-work order, which remains in effect.

A representative for Dalio rejected the notion that the order represents a defeat for the billionaire, noting that it was issued because construction didn’t exactly follow the proposed plans.

The representative characterized the stop-work order as a reinstatement of the initial one, which had been partially rescinded to allow for exploratory work.

“They’re still working to find a solution,” said the representative. “They’re making progress.”

Revocation of the permits is immaterial because they had already expired, the representative added.

Dalio will have to submit new plans and obtain permits to resume work, something a former Department of Buildings official hired by Pignatelli believes is unlikely.

“The way the structural engineer’s report is showing the details, it does not look like it’s a simple way to correct it because it has a real structural difficulty in compliance,” the former official said.

Pignatelli, for his part, feels vindicated.

“I am pleased to see that the Department of Buildings has completed a thorough investigation, and have acted competently by revoking the previously-issued permit for a minor renovation that instead burgeoned into illegally building an entire new floor,” he said. “We are confident that through the city agencies’ processes and legal system, justice will be fully delivered.”

The agency has said that while Dalio’s construction “did not fully comply” with the approved plans, inspectors “did not observe any structurally hazardous conditions,” the New York Times reported.

Dalio offered to have a third-party inspector assess the structure, but Pignatelli hired his own engineer, who found two of the eight steel connectors holding up Dalios’ deck were resting on timber columns within Pignatelli’s apartment.

Dalio and Pignatelli first tried to resolve their differences on their own, but Dalio came to the conclusion that the courts would have to do it. Pignatelli filed a lawsuit last year, seeking an award to cover damage to his apartment.

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“I’m Italian, Ray’s Italian, we’re neighbors!” Pignatelli told the Times. “We should be respecting each other and helping each other, but he’s incredibly arrogant.”

Pignatelli blames Dalio’s project for damage to his apartment, including a door that no longer closes correctly, paint falling off his brick walls, cracks in the walls, tilting wood columns and a shattered mirror.

Dalio is no longer Pignatelli’s only adversary at the Soho co-op. Pignatelli has also sued his insurance company for denying his claim for the broken mirror and other damage.