Harry Macklowe skips rent at Mort Zuckerman’s GM Building

New York property magnate Harry Macklowe has been skipping out on rent in the posh GM Building — a move that’s being seen as a slap in the face to his landlord and fellow real estate mogul Mort Zuckerman.

Macklowe, 83, stopped paying the more than $200,000-a-month bill for Macklowe Properties’ headquarters in the iconic 767 Fifth Ave. skyscraper when the coronavirus hit in March, according to a person with knowledge of the situation. The debt has insiders reminiscing about the time Zuckerman’s Boston Properties saved Macklowe from financial ruin in 2008.

“It’s shocking,” the source said. “They saved him and gave him a sweetheart deal and this is how he behaves?”

Zuckerman stepped down as Boston Properties chairman in 2016 but still retain a 5 percent stake in the company he co-founded.

Macklowe — who reportedly lost half of his $2 billion fortune in a bitter 2018 divorce from his wife of nearly 60 years — pays around $100 per square foot for roughly 28,000 square feet on the 21st floor — a price that works out to $2.8 million a year, the source said. That’s “below market,” the source said — adding that the vast majority of tenants in the 50-story tower have been paying their tab through the pandemic.

Macklowe was forced to sell the GM Building — the crown jewel of his portfolio — to a group led by Boston Properties during the 2008 financial crisis to pay off debts he accumulated the year before at the height of the market.

The GM Building
The GM Building in Manhattan.Photo by Waring Abbott/Getty Images

Zuckerman’s group paid $1.5 billion and assumed $2.5 billion in debt for the GM Building and three other office towers. The cost of the GM Building amounted to $2.9 billion, the highest price paid for a single office tower.

As part of the deal, Macklowe was allowed to maintain a token interest in the building through his $10 million stake in Boston Properties. A continued stake in the building “was very important to the Macklowe family,” his lawyer, Jonathan Mechanic, told The Wall Street Journal at the time.

The deal also allowed Macklowe to avoid dipping into his personal fortunes — including his nearly $700 million art collection — to repay loans he had taken out to buy seven Manhattan skyscrapers for $7 billion in 2007, sources said.

The octogenarian real estate mogul is now being forced to sell his art collection, which includes works by Andy Warhol, Pablo Picasso, Jackson Pollock and Willem de Kooning, among others, as a condition of his acrimonious and very public divorce from Linda. The warring exes also put their East Hampton mansion on the market for $21 million.

Macklowe Properties still owns One Wall Street, TowerFifth across from St. Patrick’s Cathedral, and 432 Park Ave., the tallest residential building in the Western Hemisphere. He turned heads last year when he draped a 42-foot side-by-side portrait of himself and his new bride — Patricia Landeau — over the luxury Park Avenue tower, which he and his ex fought over in their divorce.

Boston Properties declined to comment. Macklowe Properties didn’t respond to a request for comment.



Source link

Leave a Reply

Your email address will not be published. Required fields are marked *