Business: A deal not even a mom could love
Two years ago, Jason Gabay hired an architect to work on his waterfront home in Belleair. Now his widowed mother is out $500,000.
Confused? The sordid tale is laid out in a recent lawsuit.
Largo architect Steve Spencer began drafting designs in 2005, Gabay alleges. Shortly thereafter, Spencer offered him a remarkable investment deal: in exchange for a $500,000 loan, Spencer’s real estate development group would issue Gabay an 18-month promissory note at 12.5 percent annual interest – and throw in a $250,000 bonus.
Days earlier, the group had bought a 198-unit apartment building in South Pasadena to convert into condos. Now, he and his partners needed cash. The bonus represented 1 percent of the project’s anticipated $25-million profit.