Stephen G. Kliegerman
President of Development Marketing
By SARAH RYLEY
A group of Hell's Kitchen condo buyers are clicked off. They've banded together though Facebook to plot against a developer who sold them pricey condos before the economy crumbled.
The online posse put down deposits on apartments at The 505 in 2007 and 2008. But as they waited for the luxe Midtown building's completion, the economy nose-dived, and the buyers felt they overpaid.
So they met in the modern-day equivalent of a smoke-filled back room -- a group on Facebook called "505 West 47th Street." It started as a place where future neighbors could mingle but quickly morphed into one where buyers asked questions and posted links about reneging on their contracts. Eventually, the group planned a face-to-face meeting.
The confabs culminated in four lawsuits filed last month against Lev Parkview Developers. Together, the suits encompass 39 percent of the building's 109 apartments, or $35.5 million in contracts -- among the largest buyer revolts in recent memory.
Two other buyers have sued in separate cases. "This is a mini David-vs.-Goliath situation. We have 43 little slingshots getting the attention of Goliath," said Jon Zanoff, a finance executive who signed an $880,000 contract in 2007 for a one-bedroom and estimates that the value of his apartment has already dropped more than 10 percent.
The lawsuit hangs on a decades-old law requiring developers of buildings divided into 100 or more units to provide property reports to prospective buyers, which Lev Parkview did not. Dozens of undecided cases in New York are using the same law.
The developer claims it is exempt from the law because it removed 10 units from its building plan.
The buyers hope they can turn the oversight into a release from their contracts.
So far, Lev Parkview is vowing to deal with buyers only on an individual basis, according to Stephen Kliegerman, of the broker Halstead, who said, "No developer that I know of will deal with a group of buyers and negotiate en masse. If the market had continued to go up, I don't think they would be offering to give the developer more money."
Lev Parkview's attorney Mati Weiderpass said he was confident the lawsuits "will ultimately fail."
Sunday, August 02, 2009