Lindsay Lohan’s Brother Sued Over Alleged Real Estate Scheme

Michael Lohan Jr., sibling of actress Lindsay Lohan, is facing a lawsuit. It’s alleged that he profited from New York City’s real estate market by improperly deregulating over 150 rent-stabilized apartments, according to state Attorney General Letitia James.

The Lohan brothers, along with other property managers at Peak Capital Advisors, are accused of being part of a scheme to evict tenants from rent-stabilized buildings in Brooklyn and Queens. The plan involved converting these units into luxury lofts, selling them to young professionals at prices that could reach $6,500 a month, as laid out in the lawsuit.

This legal action, initiated last week, claims that starting in 2019, these real estate moguls acquired 31 buildings in neighborhoods such as Greenpoint and Williamsburg, which are known for their trendiness.

They allegedly transformed 159 rent-stabilized apartments into market-rate ones, thus reportedly overcharging tenants eager to live in those areas.

“The business model of Peak from the outset targeted young professionals willing to pay premium rents, directly opposing rent stabilization laws,” the complaint emphasizes.

The lawsuit asserts that the defendants sought buildings in gentrifying regions like Sunnyside, Astoria, Long Island City, and Greenpoint, looking for what they termed “significant upside potential.”

Part of the alleged misconduct involved exploiting state housing law exemptions intended to encourage the renovation of badly dilapidated buildings. The suit claims, however, that Peak neglected the legal stipulations and renovated properties merely to boost their profit margins.

“The evidence clearly indicates that Peak’s buildings were in acceptable to good condition when acquired and did not necessitate extensive renovations for livability. Therefore, they did not fulfill the legal criteria for deregulation,” states the complaint.

After completing the renovations, the Lohan group allegedly tried to obscure the situation by altering apartment numbers, making it more difficult for tenants and regulators to verify the legality of the rents imposed.

In the lawsuit, Lohan Jr. is described as Peak’s president and director of investor relations. He allegedly either received or was entitled to receive rent from the properties, resulting in what the suit claims is “an unlawful financial gain.”

This lawsuit, filed alongside the state Housing and Community Renewal Commission, aims to reclaim the excess rent paid by tenants and seeks damages.

“It’s no secret that New York City is struggling with an affordable housing crisis, yet Peak and its operators are seemingly focused on lining their own pockets while harming New Yorkers,” James remarked in a statement.

“These wrongdoers have pocketed illegal profits that have exacerbated the shortage of affordable housing in New York, which is entirely unacceptable. This lawsuit serves as a warning. My office will take robust action against corporate developers or unscrupulous landlords who attempt to exploit our housing laws.”

Others named in the lawsuit include Juan David Gomez, Alex Rabin, Amnay Labeau, Brian Anderson, Alex Kaskel, and Alex Mendik.

Attempts to get a response from Peak Capital Advisors were unsuccessful at the time.