Andy Zhu “mismanaged” Assi Plaza project in Flushing: lawsuit Investor claims developer bungled project every step of the way, including $115M sale

Andy Zhu and a rendering of 131-01 39th Avenue

UPDATED, Dec. 5, 10:12 a.m.: Developer Andy Zhu is facing claims t爱上海龙凤419桑拿

hat he bungled the huge Assi Plaza development project in Flushing he just sold for $115 million, emptying the “proverbial piggy bank” with poor business decisions such as $44,000 in unauthorized booze purchases.

Hansen Realty Development Corp., which claims to own 75 percent of the partnership that sold the development site at 131-09 39th Avenue, filed a lawsuit in Manhattan Supreme Court seeking more than $60 million in damages, according to documents recorded Monday.

“Unfortunately, Zhu was uniquely unqualified to undertake a development project of that magnitude, and he grossly mismanaged the project form the outset,” Hansen’s lawsuit claims.

Zhu responded with a countersuit, claiming it was his partners inexperience developing in the United States that derailed the project.

According to the complaint, Zhu controlled the entity that held a 25 percent managing partner interest in the site, where he planned to build a 15-story, mixed-use building with 265 residential condos, 80 retail-and-office condos and a 250-room hote爱上海同城对对碰


Hansen claims the project was fraught from the start, with Zhu mismanaging the acquisition of the site in 2015, allowing the purchase price to balloon from $63 million to $79 million as he failed to close in a timely manner.

Hansen also claims Zhu funneled $1.8 million in “bogus commission payments” by failing to disclose he held a financial interest in the companies receiving the payments.

Among other charges Hansen levels at Zhu is that he made more than $150,000 in unauthorized purchases and billed them to the project, including a $44,000 splurge on alcohol.

The final straw, Hansen said, was when Zhu sold the project to investor Yuk Ming Yip for $115 million, a sale first reported by The Real Deal last week.

Hansen claims Zhu agreed to put the down-payment into an agreed-upon escrow account with the In上海贵族宝贝交流区

dustrial and 上海夜网论坛

Commercial Bank of China, but Zhu instead funneled it into a separate account and has ignored requests to meet and discuss the sale.

Zhu s attorney in December filed an answer to the claims and a counter-suit naming Hansen s Weiming Yin and Shu Sen Jia as defendants. As the majority stakeholder, major decisions on the project ultimately required the sign-off from Yin, and failure to successfully develop the project should lie with him, Zhu s attorney claims.

The suit accuses Andy for failing to develop the project, but as a 25-percent shareholder, these were not Andy’s decisions to make, attorney B上海同城对对碰交友社区

ing Li told The Real Deal.

Zhu s answer to the complaint acknowledges that he received the commission on the sale, but said he was upfront with his role as a broker from the beginning. Zhu s representatives also provided a copy of a certified letter stating that the down payment from the property sale is held in an ICBC account controlled by his representative, Yin and Jia.

Tags: Development
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