Trump SoHo Hotel Developers Committed Fraud, Lawsuit Alleges

Trump Soho

An artist's rendering of the Trump Soho Anonymous/The Trump Organization hide caption

itoggle caption Anonymous/The Trump Organization

Rattling around their luxury building on Spring Street, buyers of the Trump SoHo Hotel units apparently smelled a rat.

Although developers told them as much 60% of the hotel-condo building was sold, apparently the true figure was more like 15%. On Monday, 15 purchasers sued for fraud in Manhattan federal court, the Wall Street Journal reported.

Prices in the building start at around $1.2 million for a studio. Buyers can stay in their units for up to 120 days a year. Under zoning rules, the units must be rented as hotel rooms for the remainder of the time.

The lawsuit alleges that the developers and their agents overstated the numbers to encourage sales. The buyers are suing the Trump SoHo's developers, the Bayrock Group and the Sapir Organization.

The suitĀ also namesĀ Donald J. Trump and his children, because Trump has a licensing and management agreement with developers. The Trump family also has an 18% equity stake in the project, the Journal reported.



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