The condo board at a troubled 1,400-foot luxury tower on New York City’s Billionaires’ Row is accusing developers of “deliberate and far-reaching fraud” by failing to disclose early cracks in the facade that it says could lead to dangerous structural issues.
Condo board members say that CIM Group and other developers of 432 Park Avenue failed to alert potential buyers and city inspectors about the severity of cracks in the signature white concrete facade that also “acts as a critical component of the building’s structural support,” according to a new lawsuit. The building opened in 2015.
The suit, filed late last month in State Supreme Court in Manhattan, also names as defendants an engineering firm and an architectural firm tied to the building’s construction. The board seeks damages exceeding $165 million, including “the diminution in value of the building and its units.”
The lawsuit details nearly 1,900 defects that have emerged in the facade of the building, one of several slender apartment buildings known as “supertalls” that dot the Manhattan skyline. Photos in the filing show vein-like cracks and chunks of concrete missing from the facade.
The suit accuses the defendants of knowing about the cracks early on but, worried about their bottom line, failing to adequately address them and instead covering up their effects.
“This matter extends beyond negligence into an alleged calculated scheme, driven by greed, that eroded trust,” Terrence Oved, a lawyer for the condo board, said in a statement.
A spokeswoman for CIM Group said the firm “vehemently” denied the claims and planned to move to dismiss the complaint. A lawyer for SLCE Architects, one of the defendants, also denied the allegations and noted plans to move to dismiss the complaint. The other defendants did not return requests for comment.
The Park Avenue building marked a turning point in luxury condo development in the city when it opened, luring wealthy part-time residents and investors who hid their identities behind shell companies. The tower drew the likes of Jennifer Lopez and Alex Rodriguez, who owned a $15.3 million, 4,000-square-foot apartment for a year, and a Saudi retail and real-estate tycoon who bought a penthouse. The building had a projected value of over $3 billion.
The suit follows other legal action the condo board filed against developers in 2021 after The New York Times revealed simmering dissension among residents who complained of floods that did multimillion-dollar damage, trash chutes that sounded like garbage bombs, stuck elevators and swaying related to the building’s slender profile. That suit seeks $160 million in damages and is pending in state court.
It’s been a tough stretch for New York’s tall, luxury towers.
Construction on 1 Seaport in the South Street Seaport neighborhood in Manhattan has been stopped in the wake of lawsuits after the tower was found to be leaning. And in Brooklyn, only a handful of units have been sold in the Brooklyn Tower, the borough’s first supertall, which has been plagued with financial drama.
The most recent suit filed over 432 Park Avenue took shape as lawyers for the board pored through seven million pages of documents and about 100 days of depositions tied to the 2021 lawsuit.
In the new suit, lawyers for the board presented a detailed explanation of defects in the tower that emerged from the start.
Plans for the building called for a naturally white concrete facade, which posed a unique challenge for a slender tower of that height. The concrete had to be strong enough to withstand all the floors pressing down on one another and stiff enough to hold up against winds that would push against the building during storms.
Andreas Tselebidis, the designer of the concrete mix, said it was “the greatest challenge ever requested by a ready mix producer,” according to the suit.
Mr. Tselebidis did not respond to a request for comment.
Cracks emerged across vertical columns in every mock-up test over a six-month period, the suit said.
The firm of Rafael Viñoly, the star architect who led the design, had repeatedly voiced concerns about the cracking, according to the suit.
“It is difficult to know the impact of cracking in a fully loaded building,” the firm wrote in a field report on Dec. 17, 2012, which was cited in the lawsuit. “It is imperative that the concrete consultant review these conditions and advise.”
The next day, Silvian Marcus of WSP, the building’s structural engineer that is one of the defendants in the suit, also expressed concerns, writing to developers to “hold the pour” until they had a “valid” white concrete mix.
Mr. Viñoly died in 2023. Mr. Marcus did not return requests for comment.
The developers forged ahead, the suit said, ordering the concrete to be poured the next month.
Cracks emerged even at the start of the pouring process, according to the suit. It said the concrete supplier was “still experimenting with design mixes” three months after the start of the facade’s construction and without understanding the cause of the cracks or how to prevent them.
The result was a luxury tower, briefly the tallest residential building in the world, with “thousands upon thousands of cracks” beginning to form, the suit said.
Ideas were batted around for how to stop the cracking with various coatings and patching. Four separate consultants were hired. But the suit accuses developers of ignoring some of the repair ideas “due to potential schedule, cost and aesthetic impacts.”
In April 2016, one of the consultants issued a report detailing 1,893 defects, more than half of which it categorized as “life safety items.” Thousands of other cracks had been patched over during construction, the suit said. Some of the flaws were aesthetic, and others were “large voids, spalls of unknown origin, unfilled cracks, opened cracks and other serious deficiencies,” the suit said.
Developers wound up with repairs that neither stopped the flooding nor prevented further cracking, according to the suit.
The suit contends that members of the development team falsely misrepresented the “nature, extent and type of cracking” to the city’s Department of Buildings, the suit said.
Architects and engineers in New York are responsible for notifying the Buildings Department of any “immediately hazardous conditions” at properties where they are working. The department had not been notified of any such conditions at 432 Park Avenue, a spokesman said.
The suit also said the disclosures used in information for potential buyers and filed with the state attorney general’s office was revised in 2013.
Wording that had said the density of the concrete “will prevent water penetration” was changed to say the concrete and properly sealed windows “have been designed to prevent water penetration.”
Dionne Searcey is a Times reporter who writes about wealth and power in New York and beyond.
Stefanos Chen is a Times reporter covering New York City’s transit system.
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