Macklowe versus tenant at 510 Madison
April 03, 2009 03:55PM By David Jones
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Harry Macklowe's Macklowe Properties is embroiled in a court battle with investment firm Jay Goldman & Co., in a dispute over whether the tenant defaulted on its lease at 510 Madison Avenue, or is being locked out of the speculative office tower.
In a February lawsuit filed in New York State Supreme Court, Jay Goldman officials allege breach of contract and asked for an injunction to prevent Macklowe from terminating the lease.
As The Real Deal previously reported, Macklowe signed Jay Goldman, one of the city's largest hedge funds, to a lease estimated at 10 years at $125 per square foot, in December 2007.
The suit alleges that the landlord sent the investment firm a notice on Jan. 20, demanding it "cure" a violation of the lease. According to the suit, the tenant was issued a notice for not paying $132,700 for the first month's rent nor countersigning a floor designation notice. The notice says that the tenant could default on its lease if it failed to respond by Jan. 25.
Jay Goldman officials claim in the suit that they were not required to respond. In addition, they said there is no provision in the master lease that requires the plaintiff to countersign anything. In court filings, Jay Goldman officials said the lease does not require its signature and that the required fire alarms, sprinkler systems and other additions were not completed in the building.
Jay Goldman officials also claim that they were denied access to the building after a February fire, and that the space was rendered "untenant-able" after the fire.
However, Richard Claman, attorney for Macklowe, argues that the lease called for Jay Goldman to pay to build out its office space, and the landlord would provide $400,000 to cover the costs. In the court filing, Claman questions whether those issues are just cause for a tenant getting cold feet because of the economy.
Daniel Ansell, the original attorney for Jay Goldman, declined to comment.
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Comments
Anonymous
Not an auspicious start for a leasing program--sue your only tenant before they move into the building. But who said NY Real Estate was pretty.
Comment #1 Posted By: Anonymous 04/03/09
Anonymous
Becoming a Macklowe tenant, in a building that has already caught fire, before it has even opened its doors. What could possibly go wrong?
Comment #2 Posted By: Anonymous 04/04/09
Anonymous
This tenant of course is looking for an back door exit. Tenants should sign off on floor designation notices and pay their rent. Macklowe Manhattan office portfolio is unraveling like a ball of yarn.
Comment #3 Posted By: Anonymous 04/06/09
Anonymous
They already had a three-alarm fire. With the Macklowe record of illegal demolition, falling bricks, undermining foundations of adjacent buildings (620 Broadway), I think the tenant has more than adequate grounds for backing out.
Comment #4 Posted By: Anonymous 04/06/09
Anonymous
Macklowe was "pleasant, charming, but reclusive." He could be cold, imperial and arrogant. He was also quiet, abstemious and never flirtatious. He was a split personality, "pure Jekyll and Hyde," an anal-retentive neat freak with a major case of obsessive-compulsive disorder. "He loved his son, but he never showed it," said a family friend. "Mostly tough love and fear. People were afraid of Macklowe. He wielded this influence. They were afraid of his temper." Golman "run baby run"
Comment #5 Posted By: Anonymous 04/06/09
Anonymous
Who was Harry macklowe? Will we ever get an answer to that question that is remotely satisfactory?
Comment #6 Posted By: Anonymous 04/06/09
Anonymous
Macklowe will go down in the annals of New York real estate as a mogul twice burned by greed and ego.
Comment #7 Posted By: Anonymous 04/06/09
Anonymous
In the world of honest developers, people detest him. The strong feelings were shaped by one event (infamous) - that bookend his nearly 49 years in business. He is the guy who in 1985 shamed his industry when he ordered the late-night demolition, without a permit, of four buildings, including a welfare hotel, in Times Square.
Comment #8 Posted By: Anonymous 04/06/09
Anonymous
Harry used to ride Billy so hard, thinking his son didn't work strenuously enough, that they ended up in counseling together. Poor Billy. I feel very sorry for Billy, Harry turned him into a pillbull full of anger
Comment #9 Posted By: Anonymous 04/06/09