Another Owner Aims to Restore the Chrysler Building’s Shine

Photo: Marcin Golba/NurPhoto/Getty Images Tishman Speyer has bought the Chrysler Building, reports the New York Times today, and the company’s work is cut out for it. Everyone’s favorite tower with the spiky Deco headpiece definitely needs some attention to its office floors and old bathrooms, especially given that so many of its neighbor-competitors are sparklingly new and highly amenitized. RFR’s Aby Rosen, the tower’s most recent owner, had planned just such a renovation job, but his plans went south owing to the vastly changed office-space market after the pandemic, and he lost the building in foreclosure this January, occasioning this latest sale. (PSP, the Canadian public-pensions fund, is an investor this time along with Tishman.) Many of the building’s 77 floors may be tired-looking, but they’re also drenched in potential. Tishman’s people have spent the past few years sprucing up Rockefeller Center — the oldest portions of which are comparable in age to the Chrysler Building, though they’ve been better maintained — and trying to make its retail spaces more of a draw. (I don’t know what its numbers look like, but the McNally Jackson bookstore at 1 Rockefeller Plaza has pretty heavy foot traffic and at least feels like a hit.) A similar zhuzhing-up project for the Chrysler Building will involve the lovely and currently disused little downstairs concourse, stripped of its old shoe-repair-and-barbershop mom-and-pop tenants a few years ago in preparation for an upscale makeover that didn’t happen. It’s a minor treasure, a space that deserves to be brought back to life, and Tishman says it’ll use it for “fitness, wellness, and meeting spaces.” The company will also be making a tenants’ club on the 61st floor, where Margaret Bourke-White briefly kept a studio in the 1930s and, glamorously if extralegally, insisted on living (with two pet alligators). That amenity will no doubt make reference to the legendary Cloud Club, the long-lost private three-martini-lunch spot up in the building’s spire. The whole project also echoes the Empire State Realty Trust’s makeover of the Empire State Building, which has received a major glow-up in the past decade or so. This is Tishman Speyer’s second round of ownership. The company bought the building in 1997 for $220 million, restored the lobby and some other spaces, and sold it off gradually, exiting in 2008 in a deal that put the building’s value at $800 million. In hindsight, it was a deft move, because the building has been sold twice since then for vastly less. Rosen got it in 2019 for $150 million. Nobody’s saying what Tishman paid this time, but the announcement mentions “an investment of $235 million,” while implying that this amount will include some of the renovation and restoration work. The area around Grand Central is a pretty lively market right now with low vacancy rates, several behemoths opened in the past few years (One Vanderbilt, 270 Park, 425 Park), and at least one more, on the site of the Grand Hyatt, likely to go up soon. Not to mention New York’s most unsettling residential conversion. A little oddly, Tishman is picking up the Chrysler Building just as it attempts to sell the adjoining 666 Third Avenue, formerly known as the Chrysler Building East and also the Kent Building. Some of the Chrysler Building’s dramatic loss of value can be chalked up to its aging infrastructure and the shaky market for not-new office space. There is also, however, its ground-lease situation. The plot beneath the tower is owned by the Cooper Union for the Advancement of Science and Art, the college on Astor Place that is attempting to stabilize its own finances after facing down an extinction-level event several years ago. The newly negotiated ground rent is unreported, but (per the Times) in 2018, it rose from $7.75 million to $32.5 million, and reports had it going to $42 million in 2028 and $55 million in 2038. Whatever actual number this new lease settles on, the rent will go into a very different type of bucket than at most office towers; as the parties said in their statement, “The long-term ground lease to Tishman Speyer comes as the college is in the midst of a bold plan to restore full-tuition scholarships for all undergraduates.” Another Owner Aims to Restore the Chrysler Building’s Shine Your product is saved! You’ll receive emails when your saved products go on sale. Manage preferences.