Red Hook Condo Board Seeks $60 Million for Shoddy Work

In Red Hook, Brooklyn, a legal battle is unfolding between condo residents and a developer that reflects a national trend of increasingly complex litigation over building defects — and who pays to fix them.

The condo board at the 70-unit Red Hook Lofts, formerly known as the New York Dock Building, has filed a 53-page lawsuit in state Supreme Court, alleging that repairs done on their property were shoddy and had become unsafe, CoStar.com reports. Members of the condo board at 160 Imlay St. are accusing owner Est4te Four Capital of fraud, breach of contract, unjust enrichment and other charges. The residents are seeking $60 million in damages.

In the lawsuit, the condo residents allege that Est4te Four "stole funds comprised of the residents’ common charges to perform some additional construction work, much of which was also substandard." Est4te Four hired a contractor to complete the construction, but some of the renovations — including a new deck on the roof — were either poorly done or not finished at all, residents alleged.

"The promised roof deck is severely over-pitched and was constructed atop old, re-used and re-purposed PVC pipe remnants, creating an unstable walking surface which, coupled with the poorly constructed parapet walls, constitutes a seriously hazardous condition," the lawsuit states. It goes on to claim that the building "is riddled with cracks, holes and other defects in its facade and roof, resulting in leaks and delamination of mortar and other condominium building materials onto the sidewalk and street below."

Neither the attorneys who represent the developer nor the condo residents responded to requests for a comment.

The number of condo lawsuits centered on repairs isn't necessarily growing, but they are becoming more complicated to settle because of how many different living spaces a developer is responsible for renovating, according to Mary Ann Ruiz, a real estate lawyer in Florida who specializes in condo litigation.

The Red Hook condo bears out her claim. The conversion of the former industrial building was designed by Morris Adjmi Architects, and it includes numerous amenities, including a gym, garden, roof deck, bike room and more.

The condo residents in Brooklyn aren't the only ones turning to the courts for relief with similar cases popping up in recent years in Colorado and Washington, D.C. In March, a group of condo residents in Rhode Island said poorly done renovations from the developer led to flooding on their first floor and cracked windows in their building, according to a local news report.

Condos, co-ops and homeowners' associations account for more than 30% of the U.S. housing stock and roughly 75.5 million residents, according to the most recent estimate from the Foundation for Community Association Research. That's an increase of nearly 10 million residents since 2013. And as the number of condo residents increases, so does the likelihood of someone being displeased with construction work or repairs.

There's one commonality among these diverse lawsuits, according to Ruiz. They're all geared to answer the same question: Once the defects are documented, who's going to pay to fix them?