Joseph Moinian filed suit yesterday in State Supreme Court in Manhattan against his lender and Stephen M. Ross, the head of the Related Co., for a "long-lived predatory lending scheme designed to steal the building, known as 3 Columbus Circle, for a fraction of what it was worth," according to an article in today's edition of The New York Times by Charles V. Bagli.
Related had bought the $250 million mortgage on the recently reclad building now being renovated at 1775 Broadway in September and planned to demolish it and replace it with "a sleek skyscraper slightly taller than his 750-foot, two-towered Time Warner Center" just across Eighth Avenue and 58th Street, the article said.
"Related Companies said the suit was 'totally without merit,'" the article continued, "But Mr. Moinian also enlisted a big-time partner, SL Green Realty, a publicly traded real estate company that owns 30 office towers in New York City, in his struggle to hang on to 3 Columbus Circle and complete a $175 million renovation."
"SL Green is not party to the lawsuit, but its willingness to enter the fray and invest in Mr. Moinian's project makes it possible for Mr. Moinian to pay off his old mortgage, which is in default," the article said.
Mr. Moinian's lawyer, Stephen B. Meister, said Mr. Moinian will pay the mortgage, but there is a dispute over a $54 million prepayment penalty charge that Related is demanding.
Mr. Moinian does have assurances from SL Green, the article said, "that it will provide a new $250 million mortgage and have an equity stake in the property, if and when the Related mortgage is paid off."
Mr. Moinian bought the building in 2004 and refinanced the property two years later, borrowing $250 million from Wachovia.
Mr. Ross, the article said, has indicated that "he planned to put a Nordstrom department store in the base of a new skyscraper designed by a famous architect, with about 140 condominiums on the upper floors.
In the suit, the article continued, "Mr. Moinian claims that his lender and Mr. Ross scuttled leases with two potential tenants by insisting on a demolition clause, requiring the companies to vacate. He plans to ask a judge to let him pay off the mortgage while he and Related battle in court over damages and whether Mr. Moinian will be required to pay the $54 million penalty."
Related had bought the $250 million mortgage on the recently reclad building now being renovated at 1775 Broadway in September and planned to demolish it and replace it with "a sleek skyscraper slightly taller than his 750-foot, two-towered Time Warner Center" just across Eighth Avenue and 58th Street, the article said.
"Related Companies said the suit was 'totally without merit,'" the article continued, "But Mr. Moinian also enlisted a big-time partner, SL Green Realty, a publicly traded real estate company that owns 30 office towers in New York City, in his struggle to hang on to 3 Columbus Circle and complete a $175 million renovation."
"SL Green is not party to the lawsuit, but its willingness to enter the fray and invest in Mr. Moinian's project makes it possible for Mr. Moinian to pay off his old mortgage, which is in default," the article said.
Mr. Moinian's lawyer, Stephen B. Meister, said Mr. Moinian will pay the mortgage, but there is a dispute over a $54 million prepayment penalty charge that Related is demanding.
Mr. Moinian does have assurances from SL Green, the article said, "that it will provide a new $250 million mortgage and have an equity stake in the property, if and when the Related mortgage is paid off."
Mr. Moinian bought the building in 2004 and refinanced the property two years later, borrowing $250 million from Wachovia.
Mr. Ross, the article said, has indicated that "he planned to put a Nordstrom department store in the base of a new skyscraper designed by a famous architect, with about 140 condominiums on the upper floors.
In the suit, the article continued, "Mr. Moinian claims that his lender and Mr. Ross scuttled leases with two potential tenants by insisting on a demolition clause, requiring the companies to vacate. He plans to ask a judge to let him pay off the mortgage while he and Related battle in court over damages and whether Mr. Moinian will be required to pay the $54 million penalty."
Architecture Critic
Carter Horsley
Since 1997, Carter B. Horsley has been the editorial director of CityRealty. He began his journalistic career at The New York Times in 1961 where he spent 26 years as a reporter specializing in real estate & architectural news. In 1987, he became the architecture critic and real estate editor of The New York Post.
6sqft delivers the latest on real estate, architecture, and design, straight from New York City.
