Investors Sue Rishi Kapoor, Developer Embroiled in Miami Mayor Scandal
By Julia Echikson July 18, 2023 7:00 pm
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Investors Alex Kleyner and Diana Ulis sued Location Ventures and its CEO Rishi Kapoor for allegedly failing to pay them $25 million, while the Coral Gables-based developer faces a host of investigations, including one into alleged improper payments to Miami Mayor and presidential hopeful Francis Suarez.
In 2021, three entities tied to Kleyner and Ulis funneled just over $25 million in total, according to a lawsuit filed in Miami-Dade County Court on July 7. The largest chunk, $10.2 million, was invested in a luxury condo project in Coral Gables. Late last year, Location Ventures paid $35.5 million for a 1.6-acre site at 1505 Ponce de Leon Boulevard, property records show. But the project has yet to break ground.
Another portion, $6.37 million, was invested in a luxury condo project in Fort Lauderdale, where the developer has plans for two Edition-branded projects. They, too, have yet to break ground.
The remaining $8.5 million went directly to Location Ventures.
According to the complaint, Kapoor was meant to pay back the investors every two weeks in accordance “to an agreed-upon buyout schedule.” But in May 2023, Kapoor defaulted. Now, the investors want their money back as well as the interest owed.
A representative for Kapoor and Location Ventures did not immediately respond to requests for comment, while the lawyer representing Kleyner and Ulis, Alan Kluger, declined to comment.
The lawsuit comes as Kapoor faces scrutiny from federal agencies. The FBI opened an investigation in June after the Miami Herald revealed that the developer had allegedly paid Miami Mayor Francis Suarez about $170,000 over two years to help get a condo project approved in Coconut Grove. (Both Suarez and Kapoor have previously denied wrongdoing.)
In addition, the Securities and Exchange Commission confirmed to the Herald that it is looking into whether Kapoor sold investment contracts and did not register them as securities, misrepresenting potential profits to investors or misappropriating funds for personal expenses.
Kapoor is facing trouble elsewhere. Last month, Miami Beach officials halted construction for a Location Ventures project, claiming the developer hadn’t secured all the required permits.
Julia Echikson can be reached at jechikson@commercialobserver.com.
