Africa Israel Investments owned by Lev Leviev reached settlements last week with the New York Attorney General's office and the residents at three stumbling, unfinished condo buildings they built.
According to The Real Deal, the settlements call is to resolve the defects at two Financial District condo buildings, which are the 386-unit at 15 Broad Street and 409-unit at 20 Pine Street, as well as a Downtown Brooklyn condo, which is a 79-unit building at 85 Adams Street that the Africa Israel developed.
The developer was also ordered to surrender the properties control to the condominium board and pay a penalty of $2 million to the city for inappropriately taking property tax breaks on 15 Board Street and another property next to it - the 23 Wall Street, a century-old building that is used to be J.P. Morgan and Co.'s headquarters that has been vacant for eight years - which they are required to finish.
Despite massive sales at the properties in the last 10 years, which include at least $380 million sales at 15 Broad Street, Africa Israel's condominium projects suffered from construction defects. These include faulty wiring, molds that are possibly toxic and lack of fireproofing.
A report from NY Times says that in 2008, Africa Israel stopped all the efforts to complete the renovations or build the proposed amenities right after they sold the 386 apartments in the building for at least $380 million.
After years of litigation, New York Attorney General Eric T. Schneiderman and the residents sent separate settlements with the developer last week. This is in the process of cleaning up some of the damage from the last real estate boom in the city.
Schneiderman described it as "a warning to property developers in New York State." He said, "Those who collect the enormous profits that flow from offering real estate securities in New York will not be allowed to shirk their obligations to purchasers and the public."
