By:  Benyamin Davidsons

Millionaire Eliot Spitzer has plans to build condos on the Upper East Side of Manhattan—if a posh co-op group doesn’t stand in his way.

The 63-year-old Democrat had formerly served as governor of New York from 2007 to 2008 and as Attorney General from 1999 to 2006.  Mr. Spitzer boasts an estimated net worth of $75 million in 2023, and has been leading a real estate firm, founded by his father, Bernard, who had owned an estimated $500 million. As reported by the NY Times, Spitzer faces a lawsuit from a cooperative board that could upend his condo plans.  On Friday, in New York State Supreme Court, residents at the luxury co-op located at 980 Fifth Avenue filed a lawsuit against the real estate mogul.  Shareholders in the suit are fighting for a roughly 350-square-foot concrete ditch of land behind their apartment building.  Spitzer owns an adjacent rental building at 985 Fifth Avenue, and the small vacant pit.

Both lavish residential buildings, centrally located near Central Park, are fighting for the small plot of land, because it will be pivotal in deciding when and how Mr. Spitzer can knock down his building near East 79th Street and build a new high-end condo tower, lawyers and land-use consultants told the Times. The property is legally owned by Mr. Spitzer’s rental building.

The neighboring building’s co-op board is claiming that it should have ownership rights to the pit of land, based on a doctrine known as adverse possession, which says that a party can make a legal claim to a property after 10 continuous years of undisputed use.  The co-op argues that it has regularly and openly used the roughly six-foot-deep plot of land to store construction supplies and that no one has ever asked them to stop.  “I don’t believe there’s ever been an adverse possession case filed with these stakes, by people of this stature,” said Adam Leitman Bailey, a lawyer representing the co-op. “All we’re interested in is to claim our plot of land that we have a right to own,” he said. The co-op board declined to comment on the lawsuit.

For his part, Mr. Spitzer commented to say: “This lawsuit is frivolous, and should be an embarrassment to the board.” He declined further discussion regarding their motives, but said, “It should be beneath their dignity.”  Mr. Spitzer acknowledged that he let the co-op store bricks in the space. “It’s stupid,” he said. “It’s like you let your neighbor park his car in your driveway for two weeks and they say, oh, by the way, I own your house.”

As per the NY Times, adverse possession claims are scarce in Manhattan, because each square foot is so valuable, noted Luise Barrack, the head of the litigation department at Rosenberg and Estis, a large real estate law firm who is not involved in the case. Ms. Barrack explained that even if the co-op loses the lawsuit, it will likely be successful in achieving delays. “It will be in litigation for a while,” she said.  George Janes, a land-use consultant and urban planner, added that the disputed land could also potentially affect zoning calculations, affecting the total size of the project and where windows can be placed. It can even hamper the building’s ability to obtain financing for the project.  “Lenders are risk averse and they don’t like to deal with buildings with a legal cloud,” said Janes.

Mr. Spitzer commented to say, that he does not “speculate on ridiculous legal outcomes.”