A Saudi investor is suing Harry Macklowe’s Macklowe Properties, claiming he was cut out of a joint venture agreement to acquire the retail portion of CIM Group’s 432 Park Avenue luxury condo tower.
Dr. Hamza Al Kholi claims he entered an agreement with Macklowe last year to help secure $450 million in funding for the acquisition of retail space at 432 Park Avenue, according to a lawsuit filed Tuesday in New York State Supreme Court.
While Macklowe and Qatari investment bank QInvest reached a deal to purchase the retail space from CIM Group for $450 million last year, Al Kholi alleges he was excluded from the final negotiation process and never received a 2 percent equity stake he says he was promised for securing funding for the acquisition.
Al Kholi, a Saudi businessman with considerable holdings in the Middle East, claims in the lawsuit to have “expended considerable time, effort and funds in promoting the joint venture” while providing Macklowe with a “valuable network of wealthy and influential contacts.”
The businessman, who is seeking damages in excess of $9 million, also says he “ultimately succeeded in securing an investor to provide 100 percent of the required financing” for the acquisition, namely QInvest.
“Our client basically delivered what they promised to deliver, which was the financing for the property to a partner, and Mr. Macklowe did not pay them,” attorney Donald David of Akerman LLP, who is representing Al Kholi, told The Real Deal.
The tower will hold 58,500 square feet of Retail Space Fronted Along East 57th Street. The luxury retail component is expected to be completed in 2016.
Macklowe declined to comment on the matter.