Buyer calls Plaza Hotel suite "attic-like," sues

A general view shows The Plaza Hotel during the first day that the hotel is open following extensive renovations in New York March 1, 2008.

NEW YORK (Reuters) - The buyer of a $53.5 million penthouse apartment in New York's famed Plaza Hotel says the apartment turned out to be an "attic-like space" with low ceilings and obstructed views, and he is suing for a refund plus damages.

The apartment's anonymous buyer, who made the purchase based on a video, is suing the hotel, developers El-Ad Properties and brokers Stribling & Associates for breach of contract, fraud, deceptive trade practices and negligence.

The buyer, who local media have identified as Russian financier Andrei Vavilov, is asking for the return of his $10.7 million deposit and for an additional $30 million in damages.

"This is a classic bait-and-switch," Y. David Scharf, the buyer's attorney, said on Monday. "My client was led to believe that it would receive one of the most luxurious apartments in New York history. It got far less than what it bargained for."

The lawsuit claims that among its other flaws the apartment has small windows and ugly drainage grates,

El-Ad and Stribling & Associates called the suit baseless. It was filed on Friday in New York State Supreme Court.

The Plaza overlooks Central Park and has inspired writers such as Kay Thompson, author of the "Eloise" stories about a 6-year-old girl who lived at the hotel, and Neil Simon, who wrote the Broadway play and hit film "Plaza Suite." It has been owned by moguls such as Conrad Hilton and Donald Trump.

After $400 million worth of renovations, the Plaza re-opened in March as a mixture of hotel rooms and condominiums. The penthouses for sale were advertised as magnificent "one of a kind" properties.

"Because the purchaser has, for some reason, changed his mind and decided not to close, does not alter the facts," said Jay Neveloff, an attorney for the El-Ad Group. "Its meritless allegations are aimed at camouflaging the purchaser's failure to meet his legal obligations to close."

After the buyer refused to close on the apartment, El-Ad Properties declared a default and refused to return the deposit, the lawsuit said.

(Editing by Daniel Trotta and Cynthia Osterman)