You are here

Saudi prince must pay Trump Organization US$1.8m in rent

US court told that prince leased luxury Manhattan apartment in 2013 but stopped paying rent in early 2017

New York

FOR the Saudi prince sued by the Trump Organization after he moved out of its 7,000 square foot Park Avenue penthouse, the rent is due.

Trump Park Avenue, a unit of US President Donald Trump's company, sued Prince Faisal bin Abdul Majeed al-Saud in February of last year, claiming he leased the luxury apartment on Manhattan's East Side in 2013 but stopped paying rent in early 2017.

In between, he agreed to extend the lease through June 2019, with the rent jumping to more than US$115,000 at one point, according to the lawsuit.

sentifi.com

Market voices on:

The unit, which spans the 21st floor of Trump Park Avenue, was listed on the property website StreetEasy then as renting for US$75,000 a month.

Jeffrey Goldman, a lawyer for the Trump Organization, argued last year that the prince had left the landlord in the lurch in a soft rental market, forcing it to consider renting the luxury site out for "zero or US$1". That claim drew a groan from the judge.

Now, Prince Faisal must pay US$1.8 million in back rent, New York State Supreme Court Justice Melissa Crane ruled on Aug 29.

But she denied Trump Park Avenue's request to throw out the prince's claims altogether, saying too many questions remained.

She said she would let the case go forward to determine whether Trump Park Avenue was entitled to more than US$1.9 million in rent it says it is owed for the balance of the lease.

The prince claimed he should not have to pay for the period after he notified Trump Park Avenue in 2015 that he no longer wanted the apartment, which has seven bedrooms and eight full bathrooms, according to a listing last year on StreetEasy.

He argues the landlord broke the lease by failing to notify him that he was in default and waived any right to additional rent when it took the keys back from him and kept his US$200,000 security deposit, at the end of 2017.

One unresolved issue is whether the landlord intentionally interfered with Prince Faisal's attempt to sublet the 7,132 sq ft apartment. The prince says that he hired a broker to list it in April 2016 but that Trump Park Avenue said he could use only Trump International Realty.

According to the prince, the penthouse was then listed at an "inflated rental amount in order to prop up sagging values in the building".

Justice Crane has scheduled a hearing for Sept 26.

The 35-storey building, at 59th Street and Park Avenue, once housed the Hotel Delmonico. It was converted into 120 condominium units back in 2002. BLOOMBERG