SL Green Settles Lawsuit Over Grand Central Terminal Air Rightsby
One Vanderbilt tower to proceed as planned, company says
Computer mogul Dell bought stake in NYC transit hub last month
A lawsuit that had threatened to derail SL Green Realty Corp.’s construction of a skyscraper just west of New York’s Grand Central Terminal has been settled.
The agreement with the transit hub’s owners eliminates uncertainty surrounding SL Green’s development of its 1,401-foot (427-meter) office tower, One Vanderbilt, the company said in a statement Wednesday. The resolution was reached after Dell Inc. founder Michael Dell’s MSD Capital acquired a stake in the terminal’s private ownership, which had been led by New York investor Andrew Penson.
Penson’s company, Midtown TDR Ventures, last year sued SL Green and New York City, claiming they illegally deprived him of air rights connected with the terminal, potentially worth hundreds of millions of dollars, when the plan for the tower was approved. Penson’s purchase of the 103-year-old terminal in 2006 came with development rights that could be sold to nearby projects, enabling them to be built bigger than zoning regulations allow.
“We are pleased that the new ownership of Midtown TDR Ventures shares our commitment to development in East Midtown and worked with us to quickly reach this agreement,” SL Green Chief Executive Officer Marc Holliday said in the statement. “With demolition nearly complete and work already under way on public improvements, One Vanderbilt is well on the way to becoming a reality.”
Details of the settlement weren’t disclosed. New York City property records show that an entity connected to Dell’s MSD Capital last month paid $63 million to acquire a stake in the terminal from Lehman Brothers Holdings Inc., the bankrupt investment bank that has been liquidating its remaining assets.
Todd Fogarty, a spokesman for MSD, declined to comment. A call to Penson wasn’t immediately returned.
SL Green’s planned 1.7 million-square foot (158,000-square-meter) skyscraper is bounded by Vanderbilt and Madison avenues between East 42nd and East 43rd streets. As part of the project, the company will invest $220 million in infrastructure improvements in the Grand Central area.