Rubin Schron offers $2B for Empire State Building

New York /
Jun.June 18, 2013 11:10 PM

UPDATED, 6:00 a.m., June 19: Rubin Schron, president of Cammeby’s International and one of the city’s major property owners, has offered $2 billion in cash to buy the Empire State Building, according to a letter an attorney for the investor sent Tuesday to an attorney for Malkin Holdings, the firm that controls the iconic skyscraper.

Schron proposed to make a $50 million non-refundable deposit once the contract was signed, and close within 90 days, the letter, written by Stephen Meister, a partner at the law firm Meister, Seelig and Fein, said. (Click here to see the letter.)

Schron alternately offered the current owners an option to participate in a new ownership structure for the 102-story tower, located at 350 Fifth Avenue.

The proposal comes almost a month after the required 80 percent of the building’s investors signed on to approve the creation of a publicly traded real estate investment trust, Empire State Realty Trust, composed of the tower and 20 other buildings.

By some measures, the skyscraper is worth more — some $2.5 billion, according to published reports.

Yet the crux of the matter is not the value of the building, but the value of the stock, the letter argued.

“There is, of course, no guaranty of the price at which Empire State Realty Trust, Inc. securities will trade once the lock-out period expires,” Meister wrote in the letter. “For that reason, we trust that Malkin Holdings, consistent with its fiduciary duties, will give serious consideration to this offer.”

Malkin, Schron and Malkin’s attorney, Thomas Dewey, a partner at the law firm Dewey Pegno & Kramarsky, did not immediately respond to a request for comment.

Meister represents investors who have been battling the initial public offering for months, and as of May had six clients who objected to a $55 million settlement that resolved a series of lawsuits from shareholders who had opposed the REIT’s formation.

When asked for a comment, Meister said in an email, “[You] need to understand where the REIT stock price goes.”

Also on Tuesday, Schron sent a letter to Jason Meister, a vice president at commercial firm Avison Young (and Stephen Meister’s son) outlining the offer. It identified Avison Young as the exclusive broker in the transaction, and noted that the commission would be paid by the buyer.

Cammeby’s owns a number of city assets including the lower 28 floors of the Woolworth Building at 233 Broadway in partnership with the Witkoff Group.


Related Articles

arrow_forward_ios
Joseph DePaolo, chief executive officer, Signature Bank in front of 1400 Broadway in Manhattan (Signature Bank, LoopNet, iStock/Illustration by Steven Dilakian for The Real Deal)
Signature Bank doubles down on ESRT’s 1400 Broadway
Signature Bank doubles down on ESRT’s 1400 Broadway
Tony Malkin, chief executive officer, Empire State Realty Trust (Empire State Realty Trust, LoopNet, iStock/Illustration by Steven Dilakian for The Real Deal)
Fetner revealed as owner in ESRT’s major multifamily acquisition
Fetner revealed as owner in ESRT’s major multifamily acquisition
Tishman Speyer buys pair of industrial assets in diversification play
Tishman Speyer buys pair of industrial assets in diversification play
Tishman Speyer buys pair of industrial assets in diversification play
Residents at Sven in Long Island City will be able to control the light show atop their building, as well as some in Manhattan. (Spireworks)
LIC tower giving residents chance to light up night
LIC tower giving residents chance to light up night
Boston Properties’ Owen Thomas, Vornado Realty Trust’s Steve Roth, Paramount Group’s Albert Behler, SL Green’s Marc Holliday and Empire Real Estate Trust’s Tony Malkin  (iStock, slgreen.com, vno.com, paramount-group.com, esrtreit.com, LinkedIn)
Office landlords profess optimism despite dip in occupancy
Office landlords profess optimism despite dip in occupancy
Empire State Realty Trust CEO Tony Malkin (Getty, iStock)
Empire State Realty’s multifamily play baffles experts, investors
Empire State Realty’s multifamily play baffles experts, investors
With offices in flux, Empire State Realty Trust is pivoting to apartments
With offices in flux, Empire State Realty Trust is pivoting to apartments
With offices in flux, Empire State Realty Trust is pivoting to apartments
iCapital Network CEO Lawrence Calcano and 60 East 42nd Street (iCapital, ESRT)
Fintech firm doubles down at ESRT’s One Grand Central
Fintech firm doubles down at ESRT’s One Grand Central
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...