In a case of things are tough all over, the Paramount Realty Group of America Corp. filed a lawsuit on behalf of Paolo Zampolli, against his former landlord, Iceland mogul Jon Asgeir Johannesson and his wife, Ingibjorg Palmadottir, for installing an allegedly "ugly" Ikea kitchen into a swanky $312,000 co-op rental apartment on the 16th floor at 50 Gramercy Park North. Hmmm .. HGTV or Judge Judy?
It seems the Johannessons are being called on the faux-Persian carpet by their tenant for committing a Nordic no-no of Viking range proportions. According to the suit, the embattled Icelanders failed to make promised renovations on time and when they finally did the kitchen was deemed unsuitable -- read cheap -- for such a luxurious home.
Evidently, Zampolli imagined something more along the minimalist lines of British Architect John Pawson (who designed the adjoining Gramercy Park Hotel). What he got was just plain, minimal. Read: particle board.
As reported in the New York Post, the lawsuit states, the budget-friendly kitchen was installed from Ikea, "which is generally known to offer low budget furniture." There goes the neighborhood. The plaintiff is suing for $52,000 in damages to assuage the embarrassment endured from a kitchen which drew "remarks from guests."
Johannesson is accused of cheaping out on the apartment after his company, Baugur, an Icelandic retail conglomerate, suffered business losses when Iceland's economy imploded in 2008. In fact, before trying his hand at the business of property rental, the Johannesson's reportedly tried to sell the penthouse they own on the floor above the Ikea-kitchen in question for $25 million. When they received no takers, plan B was renting out the lower unit at $26,000 a month. We know how that turned out.
In a lawsuit that throws in everything including the kitchen sink, the Johannessons must also respond to allegations that they ignored a cracked window, faulty air conditioning, missing shower parts and missing appliances. Perhaps the final straw, however, is the charge that in July 2009, the Johannesson's downstair's tenants and their guests were horrified when, as the New York Post reports, "chewed-up chicken wings were dropped onto their 16th floor terrace from the couple's duplex above." Niiiice.
Bottom line, property rental is not always the easy money it appears to be. If the short-sales and bank owned properties look tempting, consider the responsibilities and hidden costs of becoming a landlord, and whatever you do -- don't throw chicken wings at your tenants. They really hate that.
Take the first steps to building your portfolio.View Course »