The owners of the Empire State Building have inked a $55 million settlement with a group of investors who challenged their plan to create a real estate investment trust that would include the iconic Midtown office tower, Law360 reported.
In February, Malkin Holdings and the estate of Leona Helmsley announced plans to raise up to $1 billion through a REIT that would include the Empire State Building and 11 additional properties in New York and Connecticut. Shortly after, investor Leon Meyers sued to block the plan, and a handful of other lawsuits followed.
The investors claimed that the owners had put their own business interests ahead of other shareholders’ and had failed to consider alternatives to taking the Empire State Building public.
The REIT, known as Empire State Realty Trust, denied any wrongdoing as part of the deal, which must still be approved by a New York State Supreme Court judge, Law360 reported. It is also contingent on raising at least $600 million through the initial public offering, the publication said.
Malkin Holdings and the Helmseley estate will pay 80 percent of the settlement in cash and 20 percent in shares.
The parties reached the deal at the end of September, but it was first disclosed publicly on Friday in a filing with the U.S. Securities and Exchange Commission. [Law360]—Leigh Kamping-Carder