Monday, January 09, 2006
More coverage of the Times Tower eminent domain battle: from the NY Sun
In a 1/9/06 article headlined Owners Ousted From Times Site Awaiting Payout, the Sun stated:
More than three years after the New York Times and the state of New York used the power of eminent domain to clear the way for a 52-story new headquarters for the newspaper, nearly all the property owners and more than half the tenants who were displaced have not settled with the state over the amount of compensation they are due.
Lawyers representing displaced tenants and owners and state officials say that the recent designation of two additional judges in the New York Supreme Court to review condemnation cases will likely speed up the processing of the remaining claims. The state pays 9% interest per year on the difference between its offer and the court's final judgment.
Nevertheless, in a series of interviews with The New York Sun, the displaced tenants and owners said their experience over the last three and a half years serves as a warning to those who may be ousted by condemnation in the Atlantic Yards project in Brooklyn, the planned expansion of Columbia University in Harlem, or other projects that might now surface as a reaction to last year's U.S. Supreme Court ruling in Kelo v. New London, which allows a city to invoke eminent domain for the sake of private economic development.
...Citing increased tax revenues and more jobs, the city gave the Times about $26 million in tax breaks. The Times and Forest City Ratner are responsible for about $85 million to acquire the site. Should the owners and tenants prevail in court and the acquisition costs prove to be higher, the city and state would be responsible for the overrun.
Here's one example:
Building owner Maurice Laboz said he earned more than $1.1 million in rent a year from his former building. Before he received word of the condemnation, Mr. Laboz said he turned down an $8 million offer for the building. Later, the state offered him $1.8 million. He says he had the building independently appraised twice at $11 million.
As he awaits a court date, Mr. Laboz has received the $1.8 million from the state, which paid off the remaining $1.3 million of his mortgage and left him with $300,000
And here's a sketch of the dispute:
The lawyer representing most of the property owners and the tenants with outstanding claims, Michael Rikon, said the state commonly low balls condemned owners and tenants because judges will often decide on a settlement figure that falls between the state's assessment and the owners' or tenants' assessment.
"This is as low ball as it gets, and there are a horde of lawyers feeding off these proceedings," Mr. Rikon said.
The attorney says the total independent appraisals of the remaining cases he represents amount to $129 million, and the state's appraisals add up to $45 million.
A spokeswoman for the Empire State Development Corporation, Deborah Wetzel, said the state "promptly completed independent appraisals of the properties as required by law."
Ms. Wetzel said the state "has paid to each claimant the value of its property" as determined by the state's independent appraisals.