Starwood says dental practice is standing in the way of building luxury hotel

Fighting tooth and, well, tooth to stay at 1414 Avenue of the Americas
By David Jones | July 03, 2012 04:00PM

Starwood Capital, led by hospitality icon Barry Sternlicht, is scheduled to face off in court against a boutique Manhattan dental practice amid allegations that the doctors are standing in the way of converting 1414 Avenue of the Americas, at West 58th Street, into a luxury hotel.

In court papers, filed June 29 in Manhattan Supreme Court, Starwood claims it served Manhattan Endodontic Group, which occupies a penthouse space in the building, with an 18-month eviction notice. That was back in January 2011, when the hospitality firm paid $72 million for the building. The dental practice is the only tenant left in the building above the ground floor. But when the practice refused to vacate their 19th floor penthouse suite overlooking Central Park, Starwood filed suit — claiming that the dentists are digging in for a potential payout.

In an affidavit, Gavin Middelton, senior vice president at Starwood, said that the practice has, on multiple occasions, “refused to provide us access to its space.”

Manhattan Endodontic’s lease is set to expire at the end of this month, although it has an option through 2016, according to court filings.

Starwood is doing a gut renovation of the 1923 building into a boutique hotel.

Lawyers for the dentists have said that Starwood is trying to force out their clients, who have worked in the space since 1996 and have spent millions to build out their own space.

“The landlord has an obligation to maintain services and make sure my client can carry out business,” said attorney David Rozenholc, one of the city‘s top tenant lawyers, who is representing the dental practice.

In March 2012 letters to the landlord, Rozenholc claimed that Starwood was trying to harass the dentists by demanding access to the penthouse for plumbing and electrical work, including an afternoon and 10 p.m. appointment on a Sunday with less than a week’s notice. He also argued that the practice has more than $1 million worth of sophisticated medical equipment and confidential medical files that cannot be disturbed.

“We’ve done all the work we can in terms of the gut renovation without disturbing their business,” said Ellis Rinaldi, co-general counsel at Starwood. “We were faced with having to start this action since they’re not willing to relocate.”

 Starwood, based in Greenwich, Conn., is in the midst of a hotel development spree in New York. The company is converting the former Donnell Library to a boutique property with 115 rooms and 64 residences, under its recently acquired Bacarrat luxury flag. 

Just last month, Starwood and Toll Brothers were named to develop a massive 550,000-square-foot hotel and residential complex at the old Pier 1 site at Brooklyn Bridge Park.

A Court Hearing On The Avenue of the Americas matter is scheduled for July 12.