A condo buyer who agreed to pay $53.5 million for two New York City penthouse apartments wants his money back

Posted by: Prashant Gopal on September 9, 2008

Buying pre-construction comes with risks. For one thing, you’re trusting that the finished product will resemble the model on display in the sales office.

A Russian tycoon is accusing the owner of the Plaza Hotel in New York of playing “bait and switch” with the two penthouse condos he agreed to buy “sight unseen” for $53.5 million. He says the condos look more like an “attic” than luxury homes. He is suing El-Ad Properties and demanding it refund his $10.7 million deposit and pay $20 million in damages.

El-Ad told The Wall Street Journal that the claims are baseless.

Reader Comments

James

November 23, 2009 7:31 PM

Definitely risky buying pre-construction luxury condos. It's good that that doesn't happen in Vegas.

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About

BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.

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