The listing page for the Fitzroy, JDS Development Group and Largo Investments’ West Chelsea condo project, promises “best-in-class amenities,” including private wine cellars and customizable storage cellars.
But aspects of the delivered property fall “woefully short of industry standards and contractual requirements,” the condo board at 514 West 24th Street claimed in a lawsuit filed this week.
The board claimed in its complaint that JDS and Largo left swaths of the promised project unfinished or installed improperly, including “leaving empty rooms instead of wine cellars; trash heaps instead of finished storage areas; and non-working bathrooms, laundry facilities, and saunas in common areas abandoned before they were completed.” The complaint also names JDS CEO Michael Stern as a defendant.
A spokesperson for the sponsor called the lawsuit “entirely without merit.”
“The Board prevented Sponsor from completing minor and typical closeout items, and instead chose this ill-advised publicity stunt in the alternative,” the spokesperson said in a statement.
The board also alleged that Stern misappropriated $1 million obtained from Madison Realty Capital, which was to be used to complete the building’s amenities. Instead, the board claims, he used it for unrelated real estate ventures through JDS.
Stern had agreed he would fix the defects before abandoning the project and leaving the board and unit owners to repair and replace issues in the building and completing proposed amenities, according to the complaint.
Stern served as president of the condo board from 2020 until February 2025, during which time the building’s sponsors, through Stern, controlled the board, according to the complaint.
The board is seeking at least $5 million in damages.
The complaint lists a litany of alleged issues, including cellar drains that “represent the inverse of proper installation,” leaking sinks and floors in units and dryers that “routinely malfunction.”
The board claimed that it hired architects to inspect the building’s alleged defects every year starting in 2022, and that as of Aug. 2024, it was estimated to cost at least $4 million to cure defects in the common areas.
Stern and Largo Investments did not respond to requests for comment.
Growing pains
The 14-unit building, which was declared condo-effective in 2019, closed its first sale in 2020. It had a projected sellout of over $160 million, including non-residential units.
The lawsuit is not the first related to the work done at the site, which Stern and Brooklyn-based Largo Investments purchased for almost $35 million in 2014.
In 2020, Stern sued his equity partners, Largo co-founders Nicholas Werner and Nissim Ben-Nun, accusing them of misrepresenting their development experience, which the pair denied. A judge ruled in Werner and Ben-Nun’s favor in 2023.
Stern has also weathered a flurry of lawsuits at his Billionaire’s Row tower at 111 West 57th Street, which has seen a turnaround in formerly sluggish sales this year to the point where the building is now over 90 percent sold as of the end of September.
Stern, who primarily lives in Miami, has otherwise turned his professional sights to the Sunshine State, where JDS is behind high-profile projects, including branded condos bearing the names of Dolce & Gabbana and Mercedes-Benz.
Read more
JDS accused of inflating costs at Park Slope condo project
Another condo at 111 West 57th Street leads Manhattan’s luxury contracts
Development
South Florida
Michael Stern, JDS sue over allegedly defamatory website
