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Former Parkchester South architects sue board and CPC.

The former Parkchester South Condo architect is suing the board of managers and the condo's sponsor, the Community Preservation Corporation (CPC), for $15 million for alleged racial discrimination, racketeering, and slander as a result of the condo's decision to retain another architect during a bidding process.

Although the lawsuit was filed in November, officials at CPC had not been served and were not aware of the suit. As a result the following written statement was issued last week:

"A spokesperson for PPC (Parkchester Preservation Corporation, a subsidiary of CPC), which is represented on the South Condominium board, stated that they were not familiar with the allegations in the lawsuit. However, the board had reviewed a number of proposals from various firms for its facade maintenance, repair, and inspection program. After a careful and extensive review process, the board chose the architect that they felt was the most qualified to do the work."

Since its inception in 1989 as a certified minority business enterprise, KOR Architects has been the South Condo's architect. Sergio Ocasio-Roman, president of KOR, said that on August 31, 1999, his firm submitted a bid for facade repair, maintenance, and inspection in compliance with Local Law 11, which requires facade inspections every five years. He claims that his was the lowest qualified bid. This, coupled with the fact that KOR has spent 10 years inspecting and repairing Parkchester buildings has led Ocasio to believe that his firm was the most qualified to handle the work. He said the firm had performed the Local Law 11 work twice before in the South and twice in the North Condo.

"We knew the complex pretty well," Ocasio said. "We were the lowest bidder."

The architect claims that the board changed the bidding process from the get go. Ocasio said in the past he has submitted his bids directly to the board. This time he had to submit the bid to a selection committee allegedly filled with CPC board members and those sympathetic to the sponsor. During this round, KOR submitted a bid of $420,000 for the work. Instead, Israel Berger & Associates was awarded the contract.

Ocasio and several board members previously stated that the end result of that firm's bid and cost overruns from the work itself cost the condo $4 million.

"Their bid came out 10 times what ours was." he said. "I was shocked because we never had so much as a complaint about our work."

KOR's vice president Alex Kirschenbaum said he and his partner had given the condo free consultations on other repair work over the years.

"There was an enormous amount of trust between KOR and the South Condo," he said. In 1996, CPC became the sponsor of the South Condo board when it bought up a majority of the vacant apartments. Its plan to renovate the complex by installing new windows and upgrading the wiring and plumbing was passed in the South and will soon come to a vote in the North. Critics charge that the sponsor has an unfair edge by the number of members it has appointed and voted to the board. Opponents also claim that there has been little independent observation of the renovation process and the KOR incident highlights this. The suit alleges that the defendants violated KOR'S civil rights by deciding the awarding of the contract based "solely on account of the plaintiff's race."

"Upon information and belief these defendants constituted an association in fact that formed an enterprise to advance a policy of racial discrimination, calculated to defeat the procurement of a contract," the lawsuit states. "KOR did not submit anything," said Kumar Kancherla, the former board president who was also named in the lawsuit. He claims that during the opening round of the bidding process, KOR did nor submit a bid. Only after it learned of the other bids did the firm allegedly submit a lower one.

Kancherla said the board adhered to its rules when it chose a contractor. He claims that the bids first go through a committee and then go to the board for a vote.

"There was no wrongdoing in any instance," the former board president said. The suit also claims slander by a board member and CPC employee Kathleen Dunn during alleged comments she made about KOR's qualifications at a May 24, 1999 board meeting. The suit quotes Dunn from the minutes of the meeting as stating that KOR, "did not have the in-depth knowledge of renovation, new construction, or gilt renovation, and they were unfamiliar with the code."

Ocasio alleges that this statement led to a loss of reputation tor his firm. He said the firm has contracts with the city of Mt. Vernon to renovate 500 public housing apartments as well as a federal construction project of 80 units of senior housing op Melrose Ave. in the Bronx. Such contracts show his firm's familiarity with the work the condo expected him to do.
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Publication:Real Estate Weekly
Date:Jan 24, 2001
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