Grand Central owner fights Midtown East rezoning pricing

June 03, 2013 02:00PM

Andrew Penson, the owner of the famed Grand Central Terminal, is pitching a fight against City Hall, claiming the Midtown East rezoning proposal undervalues air rights in the district, Crain’s reported.

Penson, who previously hoped on making a tidy profit by selling the transit hub’s 1 million-plus square feet of development rights, argued the targeted $250 per square foot price is too low for the city to raise enough money for infrastructure projects and neighborhood improvements. The upgrades are a key part of the plan, which would allow for taller, larger buildings in the area.

Penson has hired a lawyer ahead of a potential lawsuit. The $250 per square foot price is approximately half of what Penson had hoped to pocket from selling his air rights.

And it seems that some stakeholders are not entirely opposed to his arguments.

“Even if $250 is the right number now, the city’s [sale of development rights] will not kick in until 2017,” Raju Mann, land use committee chair of Manhattan Community Board 5, told Crain’s. “So why the hell are we setting the price now?”

Even Council Council Member Dan Garodnick, who represents the area, is poring over a price change, Crain’s said.

“We are going to take a hard look at the price of the air rights,” Garodnick told Crain’s. “Members of the community and public are concerned about the price of the air because the less air rights cost, the fewer infrastructure dollars there are.”

But not all agree.

“We feel the $250 figure is expensive,” Steven Spinola, president of the Real Estate Board of New York, told Crain’s. [Crain’s]Zachary Kussin