Buyer says Miami developer kept his $800,000 deposit, sold condo to someone else

In early 2020, developer Rishi Kapoor approached a Miami-Dade businessman about buying a nearly $2 million unit in a planned 13-story luxury condominium high-rise in Coral Gables in his effort to secure enough pre-sales at the Villa Valencia project to obtain a construction loan.

It was no ordinary real estate pitch, according to a new lawsuit filed against Kapoor, who has drawn the scrutiny of state and federal investigators looking into his business, including a financial relationship with Miami Mayor Francis Suarez.

Kapoor offered a purchase contract to Juan Gronlier, the owner of a tile company, with a bundle of incentives spelled out in a “side letter agreement.” They allowed Gronlier to back out of his condo purchase at any time, freely assign his contract to anyone else, or have Kapoor sell the unit to another person and turn over any profit to Gronlier, according to the lawsuit.

Under any circumstances, Gronlier says, he was supposed to get back his $792,000 deposit on the condo purchase along with ongoing interest that Kapoor promised. Or, as an alternative, Gronlier says, he was supposed to receive 7.92% equity in the condo project.

“Neither of these occurred,” the suit states.

In the suit — the latest of more than 10 filed against Kapoor, his development firm, Location Ventures, or related entities — Gronlier says the developer made “fraudulent misrepresentations” by promising a “series of side benefits” that Kapoor did not fulfill as part of the original condo purchase. Instead, the breach-of-contract suit accuses Kapoor and his Villa Valencia partnership of keeping Gronlier’s deposit on unit 501, after selling the three-bedroom, three-bath condo last year to another buyer as the project was under construction.

Miami-Dade property records show that Gronlier’s unit was sold for $1,950,000 — slightly less than his sales price of $1,980,000.

Gronlier declined to comment for this story and referred a Miami Herald reporter to his lawyer. Attorney Raul Morales did not return calls and an email seeking comment.

In his suit, Gronlier says that Kapoor and his development partners not only fleeced him on his condo purchase at Villa Valencia, they also owe his tile company money for work as a subcontractor on the 39-unit residential project at 515 Valencia Ave. in Coral Gables. In the suit, Gronlier and his lawyer don’t specify how much J&P Tiles, Inc. is allegedly owed by Kapoor, nor does their case seek damages for that loss claim.

Kapoor, and his lawyer, Brian Goodkind, did not return text messages seeking comment.

After Kapoor was forced out as Location Ventures’ CEO this summer, former Miami-Dade Circuit Judge Alan Fine was hired to evaluate the company’s assets and liabilities. The goal was to liquidate certain projects while keeping others intact for potentially dozens of existing investors and private lenders involved in a variety of stalled developments, including Kapoor’s URBIN mixed-use brand, in Coral Gables, Miami, Miami Beach and Fort Lauderdale,

Among the creditors: Villa Valencia investors, who were expecting to be compensated at the end of the summer but have not received their payments.

Meanwhile, two of the biggest investors in Kapoor’s former company and real estate projects in South Florida have sued him, claiming he owes them $25 million under a contract agreement, sealed at the end of last year, to buy out their interests in two Location Ventures’ projects in Coral Gables (unrelated to Villa Valencia) and Fort Lauderdale. That lawsuit claims Kapoor failed to pay the two investors, Alex Kleyner, and Diana Ulis, as promised.

During this same time frame, the Miami Herald reported in May, corporate and public records show Location Ventures was paying Suarez $10,000 a month as a consultant for its URBIN developments. In the wake of some of those payments, the Miami mayor’s office helped Kapoor cut through red tape at City Hall to obtain permits for an URBIN development in Coconut Grove. Suarez denied using his office to help Kapoor’s residential and retail project at Commodore Plaza.

In total, Suarez was paid at least $170,000 as a consultant on Kapoor’s URBIN projects in Miami, Miami Beach and Coral Gables between September 2021 and March 2023, according to Location Ventures’ corporate records reviewed by the Herald. Suarez said he was paid by Kapoor to attract private-equity investors.

Suarez disclosed his income from Location Ventures for the first time in late August when he ended his GOP presidential campaign.

Both the FBI and Securities and Exchange Commission, along with the Miami-Dade State Attorney’s Office and county ethics investigators, have opened probes of Kapoor, his business and his consulting arrangement with Suarez, the Herald reported in June. Investigators with the FBI and SEC have questioned former Location Ventures employees.

At this stage, neither Kapoor nor any other Location Ventures executives have been accused by authorities of wrongdoing. But a former high-ranking executive in Kapoor’s company did accuse Kapoor of a number of “financial improprieties” in a now-settled lawsuit.

Greg Brooks, a former chief financial officer who worked at Location Ventures from August 2022 to March 2023, sued Kapoor’s company in May to collect $80,000 in allegedly unpaid bonuses for obtaining mortgages for URBIN’s project in Coconut Grove and a luxury single-family home project in the same community.

In his lawsuit, Brooks said he was fired after he raised concerns about the Kapoor’s handling of the development company’s funds.

Among the many allegations incorporated into Brooks’ suit:

▪ Brooks highlighted URBIN’s’ $10,000 monthly payments to Miami’s mayor “for unknown services” with “no written agreement” and “no invoices for any services,” as reported by the Herald. Kapoor responded in a court filing that he had an agreement with Suarez that was “approved” by Miami’s city attorney. The city’s top lawyer told the Herald that she did not review any agreement.

▪ Brooks accused Kapoor of using development funds to pay for his nearly $6 million Coral Gables waterfront home in Cocoplum, a $10,000-a-month private chef to cook on his yacht, which is kept at a nearly $700,000 marina slip, and a McLaren sports car — all, according to the suit, without reporting the income to the IRS.