An unfinished penthouse at the Villa Valencia condominium in Coral Gables has a leading role in the latest chapter of the legal drama starring disgraced developer Rishi Kapoor.
Mironest CG, an entity under contract to buy a top-floor unit in the 13-story mid-rise at 515 Valencia Avenue, is suing Kapoor and his former company, Coral Gables-based Location Ventures; Miami-based One Sotheby’s International Realty; Miami-based Winmar Construction and private lenders Martin Halpern and Robert Gutlohn.
“Mr. Kapoor and his insiders, including Winmar and other lien holders, need to answer for where
deposits and other proceeds went,” Jennifer Recine, an attorney representing Mironest CG, said in a statement. “It certainly was not toward completing the penthouse unit Mironest has been in contract to buy for almost two years.”
Location and Winmar, Villa Valencia’s general contractor, allegedly “duped” Mironest CG into believing construction was advancing and “ran up bills to make it appear the unit was being completed,” the complaint alleges.
Winmar has filed construction liens against a Location Ventures affiliate for $10 million in alleged unpaid invoices, the lawsuit states. But Winmar has been allegedly paid $8.7 million, and the firm is actually only owed $1.2 million, Mironest CG alleges. Winmar CEO Edwin Villegas did not respond to a phone message seeking comment.
In a text message, Kapoor said Mironest CG’s lawsuit was rife with “baseless allegations.” He declined to comment further unless The Real Deal agreed to run his statement “unedited nor unabridged.”
Inside the filing
In 2021, when Villa Valencia was still under construction, Mironest CG signed a purchase contract to buy the penthouse for $6 million, the lawsuit states. Since then, Mironest CG claims it made $4 million in deposit and construction work payments. While Villa Valencia was mostly completed and received a temporary certificate of occupancy last year, the penthouse remains predominantly a concrete shell, the lawsuit alleges.
“Two years later, the apartment is nowhere close to finished,” it continues. “Construction was stymied to a halt by what plaintiff now knows to be a massive fraud perpetrated by Mr. Kapoor, Location Ventures, Winmar Construction, and joined or aided by Location Ventures’ stakeholders’ and lenders.”
Kapoor and other defendants “laundered and diverted construction funds” for Villa Valencia to other projects or “their own pockets,” the lawsuit alleges. According to Mironest CG, Kapoor and Location Ventures entered into “predatory loans with company insiders who received inequitable mortgages on the condominium.”
Mironest CG alleges it is in danger of losing the unfinished penthouse because the Location Ventures affiliate that developed Villa Valencia is insolvent. Further, the unit could be lost to foreclosure before the buyer can close on its purchase, the lawsuit alleges.
Halpern and Gutlohn, the private lenders, allegedly provided loans to the Location Ventures affiliate to finish the build-out of the penthouse, but Kapoor instead used the funds to pay off debts and investors involved in other real estate projects.
Halpern and Gutlohn, who are based in Coral Gables, should have known that Location Ventures was in despair, but that the duo still provided the financing because they knew they could foreclose on the penthouse and other unfinished units if the loans were not repaid, the lawsuit alleges.
“Worse, the entities threatening to foreclose are all insiders who must have known of Villa Valencia’s shaky finances and red flags in Mr. Kapoor’s business practices,” the lawsuit states. “As lenders and stakeholders, they received regular reports on all construction progress and budget deviations. Unsatisfied with their ill-gotten gains, defendants are still trying to line their pockets with the few unencumbered assets Location Ventures has left.”
Halpern and his Halpern Family Trust, which is also named as a defendant, “acted appropriately and did the legal due diligence that was necessary,” said his attorney, Robin Hyman. Gutlohn’s attorney Jason Alderman did not immediately respond to an email request for comment.
When its owners were looking at units, Mironest CG’s principals dealt with One Sotheby’s broker Patsy Bilbao. She allegedly misrepresented the purchase price of another unit to induce Mironest CG to pay more for its penthouse unit, the lawsuit alleges.
“Several of the sale prices quoted by Patsy Bilbao were incorrect, including Unit 1201, the most relevant comparable to buyers’ unit,” the complaint states. “Bilbao failed to disclose that the purchase price of Unit 1201 included a cabana at the Villa Valencia pool that had been purchased for over $200,000, thus inflating the price of the comparable unit.”
One Sotheby’s denied any wrongdoing by Bilbao, in an emailed statement .
“One Sotheby’s has just learned of this lawsuit and believes the claims alleged against its agent, Patsy Bilbao, are without merit,” the statement said. “Ms. Bilbao is a highly regarded agent with over 30 years of experience, and One Sotheby’s plans on vigorously defending this lawsuit.”