Michael Shvo’s bitter battle with Core Club is getting uglier.
Shvo is asking a Manhattan judge for permission to bar the club from stationing its security staff in the lobby of 711 Fifth Avenue to check in guests, a privilege Core Club has enjoyed throughout its escalating legal war with the developer.
In a motion filed Thursday, Shvo describes the lobby check-in as a voluntary courtesy that is not written into the lease. “It is indisputable that the lease does not provide [Core Club] any right to that special treatment,” Shvo argues in court documents.
Shvo served Core Club a notice earlier this month that it was ending the “special accommodation.” But the club refused to remove its lobby security guards, citing a judge’s order to preserve its rights under the lease, per court documents. The next day, both sides attended a conference on the lobby dispute but a judge refused to act without a formal motion.
A lawyer for Core Club did not immediately respond to a request for comment.
The filing is the latest twist in a feud that has grown personal for both the developer and the exclusive members-only club, which once pitched itself as a marquee tenant for Shvo’s high-profile office redevelopment of the former Coca-Cola building.
The two sides are now locked in overlapping lawsuits on both coasts. Core sued Shvo last year for $600 million, alleging he failed to deliver on lavish buildouts for new club locations, including 711 Fifth, and then used club space for private gatherings that generated unpaid charges. Shvo countered with claims that Core defaulted on its lease at the Transamerica Pyramid in San Francisco, leaving $178 million on the table. In New York earlier this summer, Shvo moved to evict the club from 711 Fifth.
So far, the court has handed Shvo some wins. A judge recently ordered Core to resume paying rent and to service a nearly $1 million loan it had defaulted on. The judge also imposed a freeze on the eviction until the court determines how much back rent is owed, an amount Shvo pegs at $3.5 million.
In the meantime, the judge ordered both sides to “live by the letter of the lease,” according to court documents.
Core is appealing the loan ruling and has launched a fresh lawsuit accusing Shvo of letting the Fifth Avenue space fall into “shockingly poor” condition, even alleging he diverted money meant for upgrades to his personal yacht (the latest motion was filed as part of this case). Shvo’s camp has dismissed those claims as a distraction.
It’s been a difficult year for Shvo. The Israeli-born luxury developer made a dramatic exit from a trophy Miami project and continues fending off lawsuits at a number of his developments.
Most recently, Core Club, its CEO Jennie Enterprise and two condo owners at Shvo’s 685 Fifth Avenue condo development filed a lawsuit accusing Shvo and a German state-backed pension fund of steering investors and buyers into multimillion-dollar deals, then diverting the proceeds to enrich themselves and fund lavish lifestyles.
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