The owner of Grand Central Terminal has sued the city and One Vanderbilt developer SL Green for the lofty sum of $1.1 billion alongside allegations that the incoming tower has devalued the air rights on top of the terminal, the Times reports. Andrew S. Penson's suit claims that the De Blasio administration, City Council, and SL Green have dispossessed Penson of the value of the air rights after the administration allowed SL Green to move forward with the 65-story tower without additional development rights. In exchange, SL Green will fund $220 million of improvements to the subways under Grand Central Terminal. Penson's lawyer elaborates that under old zoning laws in the area, SL Green would have had to both pay for the air rights and commit to the improvements. "The lawsuit," the Times writes, "involves complex questions of zoning, constitutional law, politics and potential conflicts of interest, but it boils down to what always matters most in New York real estate: millions and millions of dollars."
Penson's lawsuit revolves around the argument that by allowing SL Green to construct a 1,501-foot tower that's twice the size of what's' zoned for the neighborhood, the city has rendered Grand Central's air rights "worthless." The lawsuit is seeking "just compensation" for the value of the terminal's air rights. An investment group led by Penson bought Grand Central for $80 million in 2006, which translates to roughly $60 per square foot for the building's 1.2 million square feet of air rights. Penson's lawsuit contends that the air rights are now worth $880 per square foot. A representative for SL Green said that construction of the new office tower will not be "sidetracked by frivolous litigation."
· Owner of Grand Central Sues Developer and City for $1.1 Billion Over Air Rights [NYT]
· One Vanderbilt Will Soon Rise 1,400 Feet Over Midtown East [Curbed]
· Midtown East's New Rezoning Finally Makes Progress [Curbed]
· City Council Green Lights 1,500-Foot One Vanderbilt [Curbed]
· All One Vanderbilt coverage [Curbed]