This month in real estate history

1975: Foreclosure begins on Chrysler Building

The lender of a $12.7 million second mortgage began foreclosure proceedings on the Art Deco Chrysler Building 34 years ago this month during an economic recession.

The borrowers of the note, partners Sol Goldman and Alex DiLorenzo Jr., at the time were the biggest private landlords in the city. DiLorenzo died of a heart attack in the building a week after defaulting on the note.

The lender, Massachusetts Mutual Life Insurance, took over the property, at 405 Lexington Avenue, in 1978.

Goldman and DiLorenzo acquired the building in 1957 for about $42 million, but Goldman admitted early on the partners were concerned. He told a reporter in 1965 the purchase “was a big gamble for us.”

The 1.2 million-square-foot Chrysler Building, at 1,046 feet, was the tallest building in the world when it opened in 1930, but was surpassed by the Empire State Building the following year.

The ownership of the property has always been complex. The land below the building since before it was constructed has been owned by Cooper Union, and that has never changed hands.

In 2008, a sovereign wealth fund, the Abu Dhabi Investment Council, bought a 90 percent interest in the building for $800 million from a German real estate fund, TMW, which sold its entire 75 percent interest, and Tishman Speyer Properties, which sold a 15 interest.

The property today is still managed and controlled by Tishman Speyer Properties.

1957: New office space created in postwar construction surge

More than 19 million square feet of office space was constructed in Manhattan in the dozen years following the end of World War II, according to a report issued 52 years ago this month.

The survey, by the Real Estate Board of New York, showed 73 buildings with 19.3 million square feet of office space had been built since 1945, with the majority in Midtown.

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There were 22 buildings constructed north of 50th Street containing 4.9 million square feet, and 21 office towers built in the Grand Central area with 7.5 million square feet. The remainder was built Downtown or in other areas of the borough. New office towers included the Bank of New York Building at 530 Fifth Avenue between 44th and 45th streets in 1957 and the Colgate-Palmolive Building at 300 Park Avenue between 49th and 50th streets, built in 1955.

The new space represented an approximately 19 percent increase in total office space, which was about 100 million square feet before World War II.

Today there is about 445 million square feet of office space in Manhattan, according to commercial realty firm Colliers ABR.

1927: Board of estimate approves slum clearance bill

The city’s Board of Estimate approved a bill fiercely opposed by the real estate industry that permitted the condemnation of old tenement buildings and the leasing of the land for development of affordable apartment housing 82 years ago this month.

The law, backed by scandal-plagued mayor James Walker, was an expansion of city powers for condemning land for widening streets or creating parks. The new powers allowed the city to lease the excess land taken but not used for the park or street improvement to developers to build affordable, modern apartments.

The New York Times quoted leaders of the Real Estate Board of New York and the United Real Estate Owners’ Association saying that while they supported building improved housing, the bill was illegal and impractical.

The legislation won final approval after passing by a wide margin in a referendum in November that year.

But one of the most significant projects undertaken using the new law never resulted in the development of promised housing.

Walker used the new powers to pay about $4.8 million to condemn some 200 buildings for the widening of Chrystie and Forsyth streets on the Lower East Side with the promise of building affordable housing with as many as 9,000 rooms.

Although he negotiated with builders and philanthropists, the housing plans collapsed and the Sara D. Roosevelt Park was opened there instead in 1934.