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By: Ellen Cans
The posh residential building at 685 Fifth Ave in Midtown Manhattan, dubbed Mandarin Oriental Fifth Avenue, was slapped with a lawsuit by a tenant.
As reported by the NY Post, the lawsuit was filed in New York Supreme Court in Manhattan against prominent developer Michael Shvo. The lawsuit was filed on Monday by disgruntled couple John Goodman and wife Diane Johnson, who paid $6.1 million for a one-bedroom condo at the Mandarin Oriental Fifth Avenue. The complaint alleges that the luxury building’s “rooftop oasis transformed into a wasteland of dead foliage and an algae-infested pool that remained open despite posing a health risk to residents.”
The building is “plagued by construction defects, unfinished amenities, a pervasive sense of neglect, and compromised services that in no way live up to Mandarin Oriental five-star standards and the Defendants’ hype,” the complaint reads. The couple also complains that the building is a “virtual ghost town,” alleging that only 16 out of the 64 units have sold after three years.“ Shvo, having extracted his profits, has effectively abandoned the building, leaving behind a financial and reputational wreck. The Sponsor, controlled by Shvo, is facing imminent default”, the complaint states, adding that they are “trapped in a desolate environment.” The couple’s lawsuit, further alleges that Shvo fed them a “seductive illusion of luxury and exclusivity.”
Per the Post, the same couple had also filed a separate lawsuit against Shvo late last year, after having paid the record price for their 18th-floor unit, demanding that he fix their unfinished unit, per The Post.
Shvo’s lawyer brushed off the allegations. “This is a disgruntled buyer who has decided to declare war … and spending his days searching for dead flowers,” attorney Morris Missry of the firm Wachtel, Missry LLP, told The Post.
In 2018, Shvo had purchased the office portion of 685 Fifth Avenue, previously the headquarters of Gucci, for $135 million in partnership with Deutsche Finance Group, from General Growth Partners (GGP). Shvo converted the building into luxury residences branded as the Mandarin Oriental Residences. Building amenities include a rooftop pool, cabanas and lounge, spa with steam room, sauna and treatment rooms, state-of-the-art fitness center by Technogym, private salon and yoga studio, a restaurant by Michelin starred chef Daniel Boulud, and in-residence sommelier service, as per a listing on Street Easy.
Shvo, who was born in Arsuf, Israel and served in the Israeli Defense Forces, had emigrated to the United States in 1996, with just $3,000, per a 2014 article in New York Magazine. His career in real estate began when he started as a broker with Douglas Elliman. By 2003, at the age of 30, he became the firm’s best broker, achieving over $300 million in sales from more than 400 transactions, per Wikipedia. In 2004 he founded his own international real estate development company, SHVO, at which he is the Chairman and CEO. As of 2021, the company boasted assets of roughly $8 billion. Notable developments in New York included: the Bryant Park Tower, The Lumiere on 53rd Street, Gramercy Starck designed by Philippe Starck, Jade by Jade Jagger, the 15-story boutique luxury apartment Fultonhaus, and 20 Pine Armani Casa.
