Remember that hedge fund manager, Alphonse Fletcher, who said the super-exclusive Upper West Side co-op The Dakota, had rejected his application to buy an apartment because they were racist?
Well, we already spoke to a board member who hit back at Fletcher’s accusations and explained that financial reasons were the sole justification for the rejection.
But now the co-op board has gone one step further: they’ve released financial documents that show why they rejected Fletcher.
And it was because he’s too poor. Well, relatively.
He was deemed without the necessary finances you need to purchase a unit in the famed apartment building. The Dakota is one of New York’s most expensive co-ops, with a long list of famous inhabitants — from John Lennon to Roberta Flack.
The board president told Dealbook that approving the purchase would expose the Dakota to “unacceptable financial risk.”
As a reminder, Fletcher already owned an apartment in the Dakota; he was looking to buy a bigger one. His accusations of racial bias ranged from issues in his purchase of other units in the co-op, to jokes being made about Antonio Banderas and drugs (Melanie Griffith and Banderas tried to move in at one stage), to now allowing Roberta Flack to have her bathtub fixed.
According to Dealbook, who, fortunately for us, has reviewed the whole 237-page document already,
The [board’s] response was noteworthy in that it is rare for any co-op board, let alone a famous one, to disclose internal matters.
Although Mr. Fletcher is a well-known investor, the board, citing tax returns, bank records and other documents that he submitted when applying to buy the $5.7 million apartment, called his statement of net worth “highly unrealistic.”
The affidavit also alleges that the funds Fletcher claimed to manage were “greatly inflated” because his firm, Fletcher Asset Management, double-counted its assets. Discovering that the firm reported a cumulative net loss between 2007 and 2009, the Dakota’s finance committee decided the value Fletcher put on his business was “not credible.”
Other issues they cited include:
- His annual mortgage payments (for two other units he already owns in The Dakota), are about $1.5 million, but his tax returns show his annual income is way less.
- Whether he could afford another apartment when his total annual maintenance cost would increase to $228,873, and renovations would cost between $1 million to $2 million.
- Fletcher supplied information through an accounting firm that on first appearances, seemed independent, but was actually run by one of his employees.
Fletcher’s spokesperson said, “there can be no legitimate question that Mr. Fletcher was more than qualified to make the all-cash purchase of the apartment next to his own at the Dakota.”
We thought it was interesting to note, however, that the NY Times’ chief financial correspondent did his own review of the financial documents, and even he thought Fletcher could be living beyond his means.
Now it’s up to the court.