Rishi Kapoor Scandal Deepens, Ensnares Another Mayor With New Revelations

Embattled Miami-based development firm Location Ventures and its former CEO Rishi Kapoor are facing new allegations of financial impropriety and providing payouts to elected officials.

Greg Brooks, the former chief financial officer of Location Ventures, alleged in a deposition that Kapoor improperly used millions of dollars in loans for a Miami condo project to instead buy out two major investors in his firm. It was also revealed Friday in a Miami Herald investigation that a small real estate brokerage that employs the mayor of Coral Gables received a $640K commission last year from the sale of a parcel in the neighborhood where Kapoor was planning to build luxury condos. 

The revelations are the latest in a series of scathing reports and lawsuits in recent months that have led to the disintegration of the firm, with Kapoor resigning last month and Location Ventures announcing that it would liquidate its assets to pay off debtors. 

Brooks alleges in the deposition, which was filed in Miami-Dade Circuit Court on Tuesday and published by The Real Deal, that Kapoor secured two loans from private investors totaling $12M for the development of a Coconut Grove project, but he instead directed the funds toward repaying two other investors in the company who were demanding their money back.

Location Ventures kept the loan on the books of a subsidiary of the firm, called Urbin, even though the entity never received the funds and they were instead wired directly to another subsidiary called Location Capital, Brooks testified under oath. 

The funds were then passed to a company controlled by investors Diana Ulis and Alex Kleyner, a couple who had invested $45M into Location Ventures but soured on Kapoor’s leadership and demanded repayment in late 2022, according to a Miami Herald report. 

Brooks said in the deposition that the payment scheme was “an improper use of funds” but said that he didn’t know if Kapoor “was intending to defraud the Coconut Grove investors.” 

Ulis and Klyner, who sit on the board of directors for Location Ventures, sued Kapoor and a Location Ventures affiliate last month, alleging that the firm still owes them $25M under a buyout agreement the couple had made with the firm. 

Brooks also said in the deposition — taken on July 17 as part of a lawsuit brought by a separate group of minority investors in the Coconut Grove project — that the FBI, the Securities and Exchange Commission and the Internal Revenue Service had contacted him as part of their investigation into the firm and Kapoor.

The deposition includes other allegations of impropriety by Kapoor, including that the former CEO had asked Brooks to sign a form that said deposits from buyers at the Coconut Grove project would only be used for construction costs. The firm had collected between $2M and $3M from around 80 individuals but the project was not ready to break ground, so Brooks refused to sign, he said. 

Brooks testified that he asked Kenneth Florio, the lawyer for Location Ventures, what would happen if he signed the form and Florio responded that “you will be committing a felony.”  

He further alleged that the depositors' funds were not kept in escrow and were instead liquidated, with more than $1M being diverted to a high-rise condo project at 1505 Ponce de Leon Blvd. in Coral Gables. Brooks also said that Kapoor advanced himself fees totaling $220K in violation of the firm’s operating agreement with investors.

The Herald reported Friday that a small brokerage firm where Coral Gables Mayor Vince Lago is a broker received a $640K commission for the $35.5M purchase of the Ponce de Leon Boulevard condo site. 

The firm, Rosa Commercial Real Estate, is owned by former Hialeah Councilman Oscar De La Rosa and includes Lago, his chief of staff at City Hall, Chelsea Granell, and Hialeah Mayor Esteban “Steve” Bovo among its five registered agents. 

Four of the five real estate agents denied involvement to the Herald and said they didn’t know who received the commission from the sale or whether it was distributed to multiple people.  

The disclosure comes after it was revealed that Lago and others had purchased a storefront across the street from the planned development and then leased the space to Location Ventures as a future sales center for the project for around $12K per month. 

Location Ventures first began to face scrutiny after Brooks filed a lawsuit in May seeking back pay from the company. In that suit, he also disclosed that the firm had paid Miami Mayor Francis Suarez at least $170K in $10K monthly installments for consulting work. 

Kapoor and Suarez, who launched a bid for president in June, have denied wrongdoing but have offered differing explanations as to what kind of work the Miami mayor had done for the firm. Suarez has said he was paid to introduce potential investors to Kapoor while the former CEO has said the mayor was consulted on the mix of stores and restaurants at the company’s projects. 

Internal Location Ventures documents published by the Miami Herald, however, showed that Suarez was approached by Kapoor on at least two occasions to help the developer resolve zoning issues surrounding the approval of the Coconut Grove project. 

The disclosure led the Miami-Dade ethics commission and state attorney’s office to open a joint investigation into the payments.