Crowne Plaza Hotel in Times Square entangled in legal battle
The towering Crowne Plaza Hotel — a at the time brightly lit but now typically dark skyscraper in the heart of West Midtown — is entangled in a bitter authorized struggle with no quick conclude in sight.
Publicly traded developer/landlord SL Inexperienced owns a sliver of land beneath the 46-story tower at 1605 Broadway between West 48th and 49th streets. It claims that Argent Ventures, which owns the debt on the house, has turned it into a “zombie building” on which it is spending no taxes or charges, even even though it collects rental earnings from the building’s workplace and keep tenants, which continue being open.
SL Inexperienced wishes a Manhattan Supreme Court choose to appoint a receiver to regulate the complete assets, reopen the 795-room hotel, and to acquire the revenue to shell out off the obligations — together with ground rent that it claims Argent owes to SL Inexperienced.
According to Green’s court submitting, Argent owes a total of over $16 million in home taxes and tens of millions extra for labor, water and other costs.
Eco-friendly sights a receiver as required to safeguard the building’s foreseeable future and also to defend its expense in the land, which will probably rise in benefit put up-pandemic.
SL Green’s court move is a counterpunch to credit card debt holder Argent, which is owned by investor Arnold Penson.
The Crowne Plaza closed in March 2020. In December 2020, Argent bought the financial debt owed by Vornado Realty Believe in, which was the hotel building’s managing companion and financial commitment manager, at a deep lower price — $90 million for a $195 million home finance loan — the Authentic Deal claimed at the time.
Vornado defaulted on a whole $274.35 million in personal debt on the web-site, according to the company’s 10-K SEC filing in December 2021.
Vornado owned all the land less than the creating apart from for the smaller slice obtained by SL Inexperienced. It snatched up the 11,000-square-foot parcel — about 1-quarter of the full floor footprint — for $121 million in September 2021.
A supervisor installed by Penson then sued in an attempt to invalidate the order, boasting that his corporation had very first refusal rights on any land sale
But SL Eco-friendly suggests that less than longstanding agreements at the spot, to start with refusal legal rights had been reserved only for the “tenant” — i.e., to Vornado, which declined to match SL Green’s supply.
Argent, SL Green statements, is not a tenant since it never ever took legal possession of the leasehold. It declined to maintain a common industrial code debt auction — which it could have completed and would have permitted it to take title.
Alternatively, it merely replaced Vornado managers with its have folks while “cynically ignoring” all of its obligations, “such as paying out contractors, utilities, taxes and lease,” which “put the building and the land at chance,” in accordance to SL Green’s court submitting.
But Richard Shinder, president of the Vornado-owned entity that nevertheless legally owns the property, said, ““SL Green’s deliberate preference to acquire a portion of the Times Square Crowne Plaza setting up in violation of [the Vornado entity’s] ideal of initial refusal has pressured [us] to start litigation to enforce its contractual legal rights.”
Shinder characterized Argent’s position as “solely a lender” to Vornado.
He blamed the SL Inexperienced motion for keeping up the hotel’s reopening and claimed that neither Argent nor its affiliates “has been compensated one penny” because it obtained the house loan and mezzanine financial loans.
In addition to the resort, the tower has a lot more than 196,000 square ft of office area, far more than 17,000 sq. feet of retail space together with a huge Krispy Kreme outlet, and a 159-car parking garage.
