Unit owners are accusing Ben Shaoul’s firm of stiffing them on reserve-fund money for the Tribeca condominium 87 Leonard. But the law might not be on their side.
The board of managers on Tuesday sued Shaoul’s Magnum Real Estate, alleging the developer was required to put another $1.89 million in sales proceeds into the building’s reserve fund. The board seeks that money plus fines and penalties for a total of about $7.6 million. The boutique project’s seven residences sold for between $6.6 million and $9.1 million from 2016 to 2018.
A reserve fund in a condominium is earmarked for building repairs and improvements. The case at 87 Leonard hinges on whether the law required 3 percent of sales to be contributed to the reserve fund, which may depend on what kind of building it was upon being converted to