Tishman Speyer Signs 150-Year Chrysler Ground Lease, $235M Upgrades

Tishman Speyer has signed a 150-year ground lease for the Chrysler Building and committed $235 million to upgrade it, Commercial Observer and Bisnow reported on October 7. Cooper Union, which has owned the Midtown land since 1901, stays the landlord. The deal changes who controls Manhattan’s most recognizable office tower after the prior operator, RFR Holding, lost it.

Why it matters

The ground lease is the whole story. Cooper Union owns the dirt and collects rent; the lessee owns the right to run, lease and reposition the building for a century and a half. Both outlets say Tishman Speyer plans to turn about 75 percent of the vacant space into pre-built office suites, with the Public Sector Pension Investment Board of Canada backing the effort.

Bisnow reports the tower is roughly 50 percent vacant. That makes the upgrade budget a bet that Midtown tenants will pay for finished space in a landmark. Tishman Speyer has a related Midtown play in its Rockefeller Plaza hotel conversion, and our New York desk tracks both.

CEO Rob Speyer said, “We will create an environment that will make our customers proud and excited to work here every day.”

The numbers

The $235 million is described as upgrades on top of ground lease payments. The ground rent for the new lease has not been disclosed. For context, Bisnow reports the old ground rent stepped up from $7.8 million in 2018 toward a $32.5 million peak.

Our own pull from the city’s PLUTO parcel file shows the lot at 37,525 sq ft of land and 1,035,307 sq ft of building area over 77 floors, assessed at $168,862,950. Against that building area, $235 million works out to about $227 per sq ft of building. Bisnow cites 1.3 million sq ft, so the per-foot figure shifts if you use the larger number.

No memorandum of lease appears in ACRIS yet. The public mirror runs only through August 31, so a lease signed October 7 would not show. Until it records, the term and parties rest on the two press reports and not on a recorded document.

What’s next

Watch for the memorandum of lease to record with the City Register, which would confirm the lessee entity, term and any stated consideration. Watch also for the first DOB NOW filings tied to the $235 million of work, which would show scope and cost in the city’s own data. The ground rent figure is the number the market is waiting on.