Dear PoP – Problems with Developer

Photo by PoPville flickr user Hoodsweatsh

“Dear PoP,

I recently purchased a condo conversion in a 4 unit townhouse. 3 of the 4 units have been sold. Over the last 6 months, I have encountered one problem after another. The other owners were experiencing similar problems and we have grown close when we started comparing notes.

We are currently having structural problems with our building (leaky roof for example) and hosts of issues dealing with shoddy workmanship. The builder, in effect, hires unlicensed workers for work and he cuts corners wherever he can. For example, our gas lines were installed improperly, causing a gas leak in our building 3 months ago.

The builder’s name is well known at the DCRA. We have initially consulted with a lawyer, who pulled a record of active lawsuits against him in MD and DC. There were pages and pages of lawsuits against him. As you probably know, builders who do condo conversions are legally bound to post a bond with the city. The bond is to cover items under warranty. When I called the DCRA, they could not find a record of his bond.

My neighbors and I are currently exploring our options. One of them is a lawsuit. We haven’t hired a structural engineer to assess the whole building, but based on our known problems, we believe the damages are not worth more than $30K, maybe $50K tops. This is a lot of money for us, but clearly not a lot of money to a lawyer or a real estate mogul. The builder also clearly knows the ins and the outs of the legal system and uses that to his advantage. Our lawyer friend (who we have not retained) played out a likely scenario:
-lawyer files lawsuit and sends notice to builder
-Builder ignores all letters
– lawyer serves builder
– Builder appears in court, represents himself, and feigns ignorance and or innocence and asks for an extension
– new date appear, builder does not appear
– Builder drags this out…
– etc etc
Meanwhile, our legal fees would mount and our lawsuit drags on.

The builder has economy of scale on his side, and he wins many battles because his accusers give up.

If you could reach out to your readers and ask them about their experiences, that would be a big help. The three of us owners of the building are all single women, middle class, and in our late 20s and early 30s; we inexperienced in these matters.”

This sounds absolutely brutal. Does the lawsuit scenario sound likely? If anyone else dealt with a similar situation – how’d you resolve it?

71 Comment

  • Yup. This is exactly how it plays out. More than likely the builder will hide his assets so they cannot be seized if and when an award is granted. So look for other entities suing him in amounts greater than yours.

  • A big part of me thinks that this is part of home ownership. It sucks, but it is true. The developer was awful and I am sure legally you are entitled to something, but it is rarely worth it… in my opinion and from my experience. You’re right, these guys do this for a living… their gig is to construct crappy homes and then evade responsibility. They are a hell of a lot better at the game than you are, for sure. They’ll give you just enough and try just hard enough to make it seem like they care. The legal system is not about justice, it is about efficiency, getting cases off the books. If the court thinks it can be resolved outside of court, they’ll let that run its course.

    We bought a house, not a condo, flipped by the craptastic folks at Menkiti Group. Everything they did was wrong and has had to be replaced. Could I sue them? Perhaps. Would it do any good? Not at all, Boe Boe “the clown” Menkiti would likely show up in his flashy car, wearing a thousand dollar suit and his million dollar smile and show the judge photos of all the great community service he’s done and all the kids he’s saved, all the while reminding the judge about the envelope of cash waiting in his office, and I’m screwed.

    I say suck it up, looks like the cost will be just $7,500 – $12,500 per person, not all that much for a homeowner, really.

  • I’ve been there! It sounds like we have the same developer! My story even made the City Paper

    Contact DCRA again, cc your councilmember and some local media. Insist that they pursue the construction bond. The developer is in violation of the law when they sold the 1st unit without having that bond in place. When that bond is there, you won’t have to sue — you can file a warranty claim through the city. You’ll have to do the initial hiring of a structural engineer out of pocket (out of condo fees), but it’s well worth it, and a good one can lead you through the claim process. I recommend Bill Grimes. He’s who we used and he’s been in the biz for a long time.

  • You mean your realtor didn’t steer you away from this? Shocking… you should ask for the commission back to put towards repairs.

    • I am the original poster. I thought I did my due diligence, as did my other neighbors.

      We all hired home inspectors, termite inspectors, etc. We also all obtained structural warranties and appliance warranties from the builder. He has been in business for decades.

      I didn’t know about the bond process in DC, but one of my neighbors did. She made having a bond posted with the city a requirement for closing. Her realtor got confirmation from the title company that a bond indeed was posted, and now we are investigating how there is no bond. Clearly someone lied here, and I believe that this fraud could land someone in jail.

      Yes, this has definitely been a learning experience. This developer is definitely not skipping town though. He seems to be a one man con, and he has too many properties at stake all over the city.

      After I emailed PoP, I actually heard more info from the DCRA and the DC Attorney General. Since the guy is not skipping town, I think that we will be in good shape eventually. Apparently, not having a bond with the city can land you in jail for up to 6 months and get you fined by $50K.

      We will get what we want eventually, assuming the DCRA and the Attorney General do their job. It’s just a matter of time. In the meantime, it’s just annoying that we have to deal with this.

      Onto the bigger picture though – How does this guy get to practice conning people for decades?? Whatever business license he has should be revoked.

    • The realtor for the first unit was my aunt…I guess he’s well-known enough in the DCRA world but not in the realty world.

  • evidence of this bond isn’t required at closing?

    • The title company is also fraudulent in this case…so they said there was a bond, but clearly someone lied somewhere.

  • Not much the OP can do, per the above posts, the developer undoubtedly is better at lawsuits than you. This is generally a textbook example of why you check your building / seller / developer out before buying, the root of the phrase ‘Caveat Emptor’, and all that.

  • I have, unfortunately, the exact same situation with our developer. If I have to give honest advice, it is give up hope. We are somewhat fortunate in that the owner still owns a unit in our building and we are at least able to take steps to prevent them from selling it (the developer has also simply ceased paying condo fees on the unit — just total a*holes in every respect). But this city just doesn’t give a damn about holding developers accountable and I suspect that lots of developers evade lots of laws due to connections, kickbacks, etc., really the only explanation for some of what I’ve seen. It is an absolute travesty. We were told we had to get an inspection. This was done probably 18 months ago. Then we were told the city had no money for inspectors to verify our inspection results. So we spent all this money and the city has so far done jack squat. Late in 09, we were told the city finally had money to hire an inspector, and we were 10th on the list. This was in November. We were given an estimate of 30 days … same estimate in December, Jan, and Feb. Now there is NO estimate for completion. We are STILL 10th on the list because of unspecified issues preventing ANY of the scheduled inspections from yet being completed. The city IS supposedly about to file a separate lawsuit against the developer because of its failure to maintain the legally required bond (aka, even if we win, there is nothing for us to recover right now), but I have little faith in the city to actually accomplish anything after YEARS, literally, of inexplicable inaction and broken promises. My only real hope again lies in the fact that they still own a unit in the building which we can hopefully enjoy from being sold. Otherwise, I am sure they will never reveal any assets.

    Speaking of building leaks, we have, after a few years, developed leaks throughout our building when it rains, mainly in HVAC closets and in windows / bathrooms on the side of our building. I have no idea even what sort of contractor to call to diagnose the issue (brick may need repointing, could be something else to do with drainage, who knows), let alone repair it. Does anyone have any suggestions for contractors who have worked on these sorts of issues successfully and reliably in your own buildings?

    • WRT to the unsold unit in the building. Call the broker listing the property, and tell him or her about your problems. By law, they will have to disclose problems (at least structural problems) to prospective buyers, and he or she may even remove the listing.

      • Thanks. They are actually renting it out right now, not trying to sell it, but we are trying to get some sort of lien in place (I think the city will do so in the event the bond suit is successful in all events) to prevent any sort of sale. If it ever DOES go up for sale, we will definitely take action …

        Hope someone has an answer for a link contractor recommendation! It has been a weirdly hard task to find someone who might be able to diagnose / remedy the situation.

      • I live in the same building as the OP, and that’s what we did. 🙂 Bring on the lien, baby!

  • @Afternoon

    The Menkiti Group is atrocious. The quality of their work is utterly terrible, and now I heard they’re in the landlord business!!! God help their renters.

    I love how they claim to be helping the community while at the same time flipping houses with rehabbed interiors and shiny appliances but then those same houses fall fricking apart six months after people move in.

    It’s always shocking to read that anyone has had a good experience with them, although I hear that they do monitor posts online about their business so maybe it’s just their own hacks posting the positive comments.

    • Yes. Menkiti Group is terrible. They do seem so nice but i’ve caught them in numerous unethical practices and most of their work is very poor. If anyone wants to start a class-action suit against them, I think you’d have plenty of willing participants.

  • Since you may end up pursuing a lawsuit, I’d stop publicly stating how much you believe your damages are worth, and what you believe to be the strengths and weaknesses of your case. Those statements could make it more difficult to prove your case.

  • call the news and blow it up? local news loves stories of people getting scammed, get this guy’s name out in the streets and see who comes out of the woodworks as your ally. If I were in your shoes, and I thought I wasn’t going to get mine, I would ruin this guy’s life.

  • My husband had similar problems with the developer of his old building, and that building was successful in pursuing a claim against the developer. I would encourage you to contact the firm Chadwick Washington in Virginia. They were really happy with the service and that firm is accustomed to working with small buildings (i.e., groups that need to keep costs down).

  • Contact Jim Graham with all this info and make sure to donate to his campaign. That’s NOT a requirement to get service from the DC government but it gets your name known to his campaign office and this is all about publicity for you.

  • The group to avoid, The Menkiti Group :

  • Menkiti Group

    “A Different Kind of Real Estate Experience”

  • Go stand on the sidewalk outside the next open house grand opening that this developer is having at another project and hand out a description of your project’s woes to each and every prospective buyer. That will get the developer’s attention. You have to hit them where it hurts—which is future sales. They can manipulate the legal system and DCRA inspectors ad infinitum. There is nothing they can do with respect to an aggrieved prior purchaser badmouthing them in front of their potential clients. And if they threaten you with a libel/slander action—Truth is an Absolute Defense.

    • This is a great idea. I have started going to visit homes Menkiti is selling to look for code violations and then call DCRA.

      I haven’t started handing out fliers for fear of getting sued… or beat up. Bo is a big dude.

      For those who have also spoken out against Menkiti, are you fellow victims? Near victims? Innocent bystanders?

    • That’s an awesome idea

  • Our condo pursued the construction bond as well. Same problems. We hired an engineer to do the initial review and came up with about $20,000 in needed immediate repairs. but here is the major problem. You have to have DCRA send out an inspector themselve who will determine what the contractor is responsible for, but this being DC, they didn’t have anyone in that position at the time (this was early 09) and stated directly that they would not be filling the position anytime soon do to budget cuts. We emailed CM Graham but could get no help so we are eating the costs ourselves. honestly, you are screwed. spend your $$$ making the fixes yourself and consider it the tax of living in DC.

  • wow, this is absolutely ridiculous that an agency like DCRA is pretty much not doing anything.

    Why don’t we all get together somewhere and discuss our issues and possibly discuss going to a news outlet about this? Maybe we can publicly shame not just our builders but also the DCRA into action.

    • ah

      The DCRA has no sense of shame — that is why they’ve been one of the most corrupt, poorly run of the DC agencies (and that’s stiff competition). They can’t issue building permits in a timely fashion. They impose random inspections and fines that fail to target the most egregious offenders, are totally non-responsive and disorganized at tracking any meaningful complaints, and so on.

  • I am shocked that you can buy or sell a property in DC without an inspection. Inspections are generally required as part of the sale by cities and states. Especially as some states — California for instance — state that once you purchase a property you are the one liable for code violations. (Including problems that may arise with the water table.) Not the original developer.

    Shocking that the system in DC has so few checks and balances.

  • I suggest we protest at the new DRCA office! Anyone up for a good old fashioned sit in? That would make the news! PoP would be famous! “Brand new DRCA office has sit in to protest lax enforcement of construction standards”

    Seriously. This guy is being protected by the city, so you have to embarrass the crap out of the elected officials. DCRA probably has their hands tied by the City Council. Someone on the city council is benefiting from this developer. You just need to embarrass them all until the problem gets fixed.

    That or pay the $50k. It’s up to you. The developer is betting you’re too lazy to do anything but pay.

  • I am totally game for any sort of coordinated effort to attract media attention to the sham that is the DCRA. It truly has been a kafka-esque experience just trying to get the inspection we are entitled to, months and months and months and thousands of dollars (in both legal and inspection fees) of wasted effort, incredible. It really is a buyer beware situation in DC … make sure you are buying from a BIG, REPUTABLE developer, otherwise, you are taking a spin on the roulette wheel — some are responsible, but for those who are not, there is simply NO recourse … they have the customer by the balls, the city apparently doesn’t care, and the developers know it, which allows them to act with impunity.

  • Its funny to read expressions of shock re: DCRA on this page. Did you people just fall off the turnip truck yesterday? Rule 1 of life in DC is government agencies and offices are corrupt, incompetent, racist, ignorant, and a bunch of other adjectives. Change is happening, extremely slowly, and will take decades at best. Welcome to DC, now you see why most people in region opt to live in VA or MD. They trade a longer commute for base competency in governance (with some exceptions of course).

  • Isn’t the title company on the hook since they stated that there was a bond when in fact there was not? In some states this would make the title company liable, just as in cases when the title company searches for liens against the property. If they fail to identify a lien, state that there are no liens, they are then liable.

  • Hello All:

    We do not oversee claims on warranty bonds or conversions and haven’t for many years. Those claims go to the Department of Housing and Community Development. And for anyone who has other issues or is facing hurdles, email me directly at michael.rupert(at) or via twitter @dcra and we’ll try to fix the problems. And to people who have posted negative comments, please email and I’d be happy to discuss everything we’ve done in recent years to fix a lot of the historic issues you have mentioned. Email me anytime.

    Mike Rupert, DCRA

  • Glad to hear that other people have experienced problems with shady condo developers and DCRA. I will NEVER buy a condo again becuase of my experience. The electric whent out becuase it caught fire. He never replaced the original wiring in the buidling. The building was built in the 1940’s. Sewage backed up into the basement apartments, he didn’t place any insulation in the walls like it said he did in the condo docs and the roof leaked. How can a developed get away with ripping off DC residents? I had to live in a hotel for a month while the developer fixed the situation, of course he was reimbursed by the bond DCRA had. I guess I can count myself lucky because he paid for the hotel bill. You best believe I ate well and opened a tab at the bar every week. It was on him! I will never buy a flip or another Home Depot special. I learned my lesson. This experience has really made me think about moving out of the district when I go looking for a decent SFH. I just don’t trust these flips on all of these old houses.

  • Being a legal contractor in the Washington DC area for over 10yrs and with 30 years of construction experience. I have seen and worked on many properties that have been butchered or what I call Cosmetic Engineering The outside looks good but the inside is covred up with fancy trim works. The core of my business is repair. My company
    works mostly with structual engineers before any walls, foundations are remedied. I tuely understand what homeowners are complaining about because our job has been to go behind other contractors(illegal) to fix issues that was short cutted. This makes it extremely difficult to get customers to trust good contractors.I have summarized, that most of the condo flips show signs of flaws in one to 3 years after customers have purchased their homes.
    Here’s the problem……. The General Contractor or Real Estate broker,or Developer hires subcontractors, most of which are not licensed or Bonded. These are contractors that are out of state. Please note: DC CONTRACTORS CAN NOT SECURE A BUSINESS LICENSE WIHOUT A BOND. The GC and the Deveolper wins the contract and they get ther cut right off the top. What ever is left will be used to hire sucontractors with little or no ovrhead epenses.(usually non-documented imigrants are used) This is where I beleive all the problems start to take place.

    Proper plans and structual issue not adressed to code.
    Sub-contractors are forced to cut corners
    Untrained and unlicenced, illegal workers
    Proper inspections not done by DCRA
    Bonding and Insurance issues not checked.
    Ownership of problems are dfficult to pinpoint wthout costly legal intervention

    Also note: Any contractor that has insurance, they should be covered. This may be a way for the customer to have a recourse in recovering money lost do to shotty work. ALWAYS ASK TO BE ADDITONALLY INSURRED ON THE cERIFICATE OF INSURANCE AND HAVe THE CONTRACTOR TO SHOW PROOF. aLSO WITH A LICENSE # AND bOND BEFORE ANY WORK IS STaRTED. pROOF OF WORKERS cOMP ASLO.

    IF you can locate the Insurance Company of the developer,General contractor or subcontracor, you may have a way to resolve the issues.

    Call me if I can be of further help

    Brannan & Brannan Services,LLC

  • One more thing, it doesn’t matter how close you are to a bar or restaurant if your house/condo was a crappy flip and you have to pay to fix all of that shizit. You won’t be able to afford that latte or cocktail if you have to fix the roof or replace the electric wiring…

  • His equity, builder’s risk and profit, if any, are all tied into the last remaining apartment.

    You should act quickly and consider filing a “lis pending” on the title of that 4th and last remaining unsold unit in order to ensure this Bo Minkiti creep can’t walk away from this project until all issues are fully remedied to you and your neighbors’ satisfaction.

    Shame him into either changing his ways, or run him into getting out of this line of work.

  • Just to add to the physical problems with this property, our developer is also our building manager, and has not paid ANY bills since we moved in. We actually had liens on our property at one point for the water bill. The man has already spent time in federal prison, been on national news, and was the inspiration for the Foreclosure Act of 2005. He has been in 300+ court cases between DC and MoCo. I would LOVE to know how this man can still be in this business and how people like his title company, lawyer, and realtor can get away with licenses.

  • I am the Real Bo Menkiti……and I know this may be disappointing to some but ……… I drive a beat up 2003 Chevy Trailblazer ………I don’t have any $1,000 suits ………and last time I checked I haven’t developed any 4 unit buildings…(no judges on the payroll either :))

    Some developers and I guess now some blog posters all too often hide behind anonymity in order to perpetuate misleading/false ideas……..That has never seemed to me like an effective way to do business or solve an issue.

    If someone has a real issue with a property we actually built I would ask that they contact us directly to see if we can resolve it.

    Over the past 5 years we have helped over 200 homebuyers purchase their first homes, helped numerous individuals and organizations sell their properties and developed over 50 units of quality affordable housing in DC and so far we have not been directly contacted about any ongoing deficiencies in any of those properties.

    It does seem like some of the posters here have had some real challenging situations with other developers and we would hope that you all can get the help you need in getting those issues resolved. There are a lot of resources out there including DCRA and private professionals that can be of help.

    All The Best

    • Bo. You and your group certainly have done a lot. Sadly a lot (but not all) of it has been very poorly done. Maybe a good step would be to reach out to every person who bought a home or condo that your group flipped to see what issues they have had as a result of the hack job renovations. I’m sure that would greatly improve your reputation around town–especially in Brookland. All the best as you make amends.

  • In theory, a developer is not supposed to be able to obtain a Certificate of Occupancy without first posting a Warranty Bond equal to 10% of the estimated construction costs with DCRA/DHCD. That’s the way it is supposed to work.

  • Could the original poster please post the address and developer? Might help clear up the confusion.

  • We all, especially the writer and PoP, owe it to correctly identify the builder/developer of this project here or in another post.

    • POP, what are your thoughts on posting the addresses and the developers of these places. Lots of opportunity for libel and slander yet it also keeps people honest. As we’re seeing here, there are a lot of buildings out there with significant issues and weasel developers that are not dealing with them.

  • If the owner of a unit isn’t paying their condo dues, at some point the condo association has the legal right to foreclose on the unit.

  • is the developer’s name Mahmoud, by any chance?

  • Mahmoud is not my developer, nor is it Menkiti group.

    I’m not posting his name because I don’t want PoP to get in trouble.

    I have several strategies up my sleeve, and there are a lot of good ideas here. I particularly like the part about going to open houses and passing flyers that detail my troubles.

    I actually have acquaintances at the Economist, and I’m going to try to convince them to look into this matter. I’m not a journalist, but this seems to be a pretty juicy piece:
    – you ‘ve got a sketchy builder that has ripped of hundreds of people over the span of DECADES
    – you have a government agency that knows about said sketchy builder, but sits on its ass and lets people like sketchy developer to keep ripping people off
    – and as people have mentioned you have said government agency sitting on its ass because DC councilmembers are probably getting paid off by sketchy developers..

    (Let’s keep our fingers crossed)

  • Wow, this is the first I’ve seen PoP turn to basically libelous anonymous comments. I have executed numerous large value real estate deals with Menkiti Group nearing close to $2m dollars, and have at least 6 acquaintances that have used Menkiti Group and all are very happy.

    I’m curious if all the anon posts are from one person, and if you are going to accuse someone of bribery and numerous other ethical lapses, you should have the cojones to show your face.

    Finally, PoP there is a clear legal obligation to evaluate potentially libelous statements and remove them, especially when anonymous. Google’s actions at blogspot show the precedence and while I know you don’t have the staff to evaluate each and every post, I would take a close look at these statements due to their nature.

    I almost imagine that this is someone in competition w/ Menkiti group rather than a disgruntled customer. Finally, no single real estate transaction is painless. We are largely dealing with old homes or new, quickly contructed condos. I’ve had massive problems with brand new $700+ Condos (Coldwell Banker and Cohen Development – not Menkiti) that took a lot of time and effort to fix and I’ve also had problems with my current older home and it’s subsequent fixes.

    It’s going to happen, a lot of these houses are 80-100 years old. I will continue turning to Menkiti group as I have found them nothing more than 100% honest. They steered me away from properties and even in my most recent purchase were very open in explaining all the negatives of the property prior to me deciding to move forward. They were right, and some of the issues needed addressed and they stood by me as my agent long after the sale was completed to continue to have the developer address specific issues.

  • Just want to say thank for the DCRA rep for responding here, and sorry for picking on the wrong agency. In all events, SOME agency (or agencies) of D.C. government has indisputably EGREGIOUSLY dropped the ball on these issues, and it would be great if the media paid a bit more attention so as to maybe exert some pressure on the city to resolve what really shouldn’t be a very difficult problem to address, in the grand scheme of things. It’s not like trying to deal with schools or crime or something like that. Just hire an inspector or two and have them do inspections, and actually enforce bonding requirements. And maybe even be a bit more proactive and set up a single clearinghouse website where folk can post stories about particular developers, and developers can have a chance to response. That would be very useful as well. For relatively modest costs, the city could really have a positive impact on what has clearly become an enormous source of frustration to people who are, generally, paying the most taxes of anyone in D.C. … folks who recently purchased expensive renovated properties. Come on city gov’t, get with it. I mean, why are we paying enormous taxes to live in DC if the city can’t even bother to enforce its own meager regulations about developments, and doesn’t even seem to care when homeowners repeatedly get screwed over?

  • It’s easy to get confused. The DCRA handles building permits, apartment permits, etc. Also when you call them asking for information about the bond, they connect you to someone and neither person explicitly says “btw, this is the agency I am connecting you to.”

    All you know is that you’re calling the DCRA and you get connected to someone who is supposedly there to help you.

    Adding to the confusion is the fact that the DCRA used to deal with bond issues.

    In any case, IMHO they’re both worthless.

  • try looking into options from your title company – if the bond was supposed to be there and they told you it was and it is not then they have a problem not you. your agent should be able to help you with this!

  • Concerned unit owners or condominium associations wishing to file a structural defect warranty claim should contact the Department of Housing and Community Development (DHCD), Housing Regulation Administration (HRA), Rental Conversion and Sale Division on (202) 442-9505. HRA was transferred from the Department of Consumer and Regulatory Affairs to DHCD on October 1, 2007, and regulates rental housing. The Rental Conversion and Sale Division oversees condominium formation and registration, including condominium structural defect warranty claims. Please give us a call.

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