A local broker for a New York City developer who once had an agreement to buy the vacant Lazarus-Macy's building Downtown claims the city's Urban Redevelopment Authority and mayor's office have been trying to scuttle a sale to his client.

George Ruby, a real estate broker who has represented developer Samuel Jemal, claims in a Feb. 4 letter to URA Executive Director Jerome Dettore that the mayor's office and redevelopment authority "have tried to circumvent the sale" to Jemal.

Ruby said yesterday he decided to go public with his complaints after he learned that Federated Department Stores, which owns the building at Fifth Avenue and Wood Street, was close to selling it to the Regional Industrial Development Corp. of Southwestern Pennsylvania.

Neither Dettore nor Tom Cox, top aide to Mayor Tom Murphy, would confirm that, and RIDC President Robert Stephenson did not return phone calls. Federated referred questions to the URA.

Herb Burger, who heads a private task force putting together a plan for the Fifth and Forbes Avenue retail corridor, said he wasn't aware of any sale. "I do not believe anybody has finalized an agreement on Lazarus as of this time, at least not to my knowledge," he said.

At one time, Jemal, president of the family-owned J.J. Operating Corp., had an agreement with Federated to purchase the property. But the deal fell through, in part because the Murphy administration wanted Jemal to sign a pledge that he would not bring gambling to the building.

Another developer, J.J. Gumberg Co., had agreed to sign such a pledge as part of its deal to buy the closed Lord & Taylor department store building, Downtown.

The URA and Jemal also squabbled over the type of retailing expected at the site. URA officials told representatives for J.J. Operating that they wanted a "quality retailer." Jemal balked at the interpretation, saying he did not believe the URA had right of approval.

Ruby mentioned the gambling issue and the URA's position on retailing in his letter. He said the URA vowed to "fight any plans for the conversion" of the building even though he had parties "willing to discuss a full development plan" for the dilapidated Fifth and Forbes retail corridor.

Although his deal to buy the building fell through in October, Jemal recently re-emerged as an interested party, talking with URA officials about the appropriate retail use of the building.

But suddenly, Ruby said, the "phones went dead," meaning discussions stopped, after which he learned of the RIDC's apparent interest.

"So far as I was concerned we never dropped our contact," Ruby said. "The interest between Federated and Jemal was always there. The problem was with the mayor's office and the redevelopment authority and Jerry Dettore."

Dettore and Cox said Ruby's claims were unfounded.

"There was no sabotage here," Dettore said. "There's no question that we acted professionally, and we were not involved in the details of the transaction."

Cox said the Murphy administration did want a no-gambling pledge, as Murphy himself has acknowledged in the past, but not because it was trying to undermine Jemal's bid for the building. The administration, he said, does not believe gambling is right for that location or the Lord & Taylor building.

In fact, URA officials said Jemal later took gambling off the table as a potential activity at the site, and once again started talking to them about other possible uses.

"This strikes me as a dissatisfied suitor," Cox said of Ruby's comments.

Burger, who hopes to announce a new plan for the Fifth and Forbes corridor soon, possibly including potential reuses for Lazarus-Macy's, said he does not believe the URA or Murphy's office tried to block Jemal's bid.

He said he could not comment on any interest by the RIDC.

"I think the city and the URA and all parties have acted honorably. It's a free-market economy and Federated is entitled to sell the building to anybody it wishes to," Burger said.

That didn't appease Ruby, who said Jemal had been lining up retail tenants, ones he believes would have been acceptable to the URA. He would not identify them. He said Jemal was planning retail on the first two floors and office use on the upper floors.

"Basically it was good retail. It's something I believe the city would have been happy with," he said. "We believe we had an understanding of the parties. We believe we had ironed it out with the city and I guess we didn't."

In a statement, Jemal confirmed that Ruby represented him in the Lazarus acquisition talks but that "Mr. Ruby does not necessarily represent the views of J.J. Operating."