Ethics Charge Filed Against Top Real Estate Broker

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The New York Sun

One of the city’s most successful real-estate brokers, Michael Shvo, was directed by an industry group to take a 90-minute ethics course after a complaint was filed against him by another top broker. Mr. Shvo also had his name and a list of his alleged ethics violations read aloud to a roomful of his colleagues at a meeting last week of the industry group, the Real Estate Board of New York, sources told The New York Sun.


Mr. Shvo was Douglas Elliman’s top producer after selling nearly a half billion dollars in real estate last year. He left the firm this fall to start his own firm, the Shvo Group.


Mr. Shvo said he is scheduled to take the ethics course next week.


The action that provoked the competitor’s complaint took place in April, Mr. Shvo said, when he met with Charles Yassky, the developer of a nearly completed luxury condominium at 44 Laight St., in TriBeCa.


Mr. Shvo acknowledges that he visited the site even though a doyenne of downtown real estate, Barrie Mandel of the Corcoran Group, was the building’s exclusive broker.


It is a basic tenet of the city’s real-estate world that a competing broker should not hold discussions with the developer of a building that has an exclusive broker unless that broker is present. The Yassky-Shvo meeting riled Ms. Mandel, and the Corcoran Group lodged a complaint with the Real Estate Board.


“Charlie asked me to come down and look at the building,” Mr. Shvo said of Mr. Yassky.


“I had no intent to hurt Barrie,” the broker continued. “I’ve worked with Barrie before, and I have nothing against her.”


Mr. Shvo maintained that visiting Mr. Yassky did not violate any rules, and that the reason the Real Estate Board decided this would be an opportune moment for him to take the ethics course is that he had never taken the course before.


“Last year I sold 700 apartments, and I couldn’t have done that if I didn’t play by the rules,” Mr. Shvo said.


A number of brokers who were present at the Real Estate Board meeting last week spoke to the Sun on the condition of anonymity.


“The benchmark for brokers’ behavior continues to rise as the industry improves its professionalism,” one real-estate executive who attended the meeting said.


“The litmus test for your behavior is, do you want to read it in a newspaper?” she said.


The head of the Real Estate Board, Steven Spinola, declined to comment, as did the president of Douglas Elliman, Dorothy Herman.


The Real Estate Board has faced a number of issues surrounding co-broking, or the practice of sharing listings with competing brokers. It is facing a suit filed by an online multiple listing service, Brokers NYC, in which the board is accused of monopolizing the New York market by sharing listings only with board members, and it is instituting harsher punishments, including hefty fines, for brokers who fail to abide by its 72-hour co-broking rules, which take effect January 1.


Despite the complaint filed against Mr. Shvo with the Real Estate Board, he expressed enthusiasm for the stricter ethics rules.


“I’m a big supporter of enforcing these rules and putting fines into play,” he said. “If I did something wrong, I would have paid a fine. I’m 100% supportive of that.”


The Shvo Group is expecting to bring $3 billion in new development projects to market over the next 24 months, Mr. Shvo said. “This is why I left Douglas Elliman,” he said. “We have been working on these projects since the start of the year.”


The new developments include the Bryant Park Towers, at 100 W. 39th St.; a building at 350 W. 53rd St.; the Fulton Haus in the Financial District, and 219 West Broadway in Tribeca.


The New York Sun

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