A glamorous Madison Avenue condo tower that generated buzz from early buyers like Susan Sarandon, Naomi Watts and Liev Schrieber, is now under legal fire from both buyers and creditors.
The legal and financing firestorm is a cautionary tale for real estate pros as it marked the first Manhattan effort by developer Ira Shapiro — one of many real-estate prospectors drawn to the Big Apple in the middle of the last decade by the soaring condo market.
Shapiro financed the project, One Madison Park, at Madison Ave. and 23 Street — and got Los Angeles talent agency CAA to partner with him — and started construction just prior to the housing bubble bursting. When it did, sales sagged and the trouble started.
At least eight lawsuits have been filed.
* Edward Lau is suing the developers — Shapiro and Marc Jacobs — to get back $1 million in overdue personal loans.
*Harvey and Linda Levine sued the duo — and their wives — for $600,000 in overdue loans.
* The original listing broker, Wendy Maitland, of Brown Harris Stevens, is suing Park Madison Associates in Manhattan state court because, she says, the developers borrowed $300,000 — and promised to repay her within 24 hours, but never did.
* One prospective buyer, Charles Milite, sued the developer for his $600,000 deposit. After his deal was canceled, the unit, 16A, was resold for $5 million, but his money was never returned. Milite even filed a second lawsuit against the law firm holding the deposit.
* Three additional suits were filed last month against the developers, for $3 million each, by would-be condo buyers.
*Finally, businessman Harvey Schiller and his wife, Marcia, filed suit against Shapiro and Jacobs to get back $1.5 million involved in buying a $7.15 million unit in the building, according to The Real Deal.
In an exclusive interview with The Post, Shapiro said: “This is a $300 million development, lawsuits happen. It’s just the times we’re in.”
While Shapiro said he has been in real estate development “up and down the East Coast” for the past 20 years, this is his first big high-rise project in Manhattan. “You will see that my story is about how a developer, in the most difficult time since the Great Depression, was able to take this project to the end,” Shapiro said, sounding confident that he will be able to turn the current problems into a successful ending as the Manhattan real-estate market appears to be nearing a bottom.
A new agent, Prudential Douglas Elliman, has been brought aboard and one of its top brokers, Tamir Shemesh, is in charge. He said the firm has brought in $70 million in offers.
Shemesh said there have been two closings since he took over around Thanksgiving. The most recent happened last week, when tech entrepreneur Yigal Lichtman closed on his $10 million unit on the 42nd floor.
“Since we took over, the market has reacted favorably — we’ve had a lot of activity, especially for this time of year. There are $14 million in signed contracts,” he said.