The Empire State Building’s managers were sued for the second time in two weeks over their decision to take the iconic New York skyscraper public last year.
Hope Ratner and Mary Jane Fales, two of about 2,800 longtime investors in the 103-story tower, filed the suit in New York State Supreme Court in Manhattan today. The complaint, which seeks class-action status, accuses the managers, Peter Malkin and his son Anthony, of rejecting higher offers for the building, including one for about $500 million more than investors received for their interests.
Empire State Realty Trust Inc., whose properties include the building, sold 71.5 million shares for $13 each on Oct. 1. The sale culminated an almost two-year quest by the Malkins to take the skyscraper and 20 other New York-area properties public, a process marked by battles with longtime investors.
The Malkins “refused to meet with any of the bidders and, to the best of plaintiffs’ knowledge, never had one substantive word of dialogue with any of them,” Ratner and Fales said in their filing, which also names Empire State Realty Trust as a defendant.
“These claims are wholly without merit and we will respond to them in court,” Hugh Burns, a spokesman for Empire State Realty Trust at Sard Verbinnen & Co., said in an e-mail.
Of about 2,800 Empire State Building legacy unit holders, a minority challenged the real estate investment trust proposal, preferring to keep a steady income stream and the bragging rights that come with owning a piece of a landmark.
A separate group of investors sued the Malkins last month over claims they deprived thousands of early investors of as much as $410 million in profit when they took the tower public.
Anthony Malkin is chairman and chief executive officer of the new publicly traded company, which owns six other office properties in Midtown Manhattan, including the 55-story One Grand Central Place. Peter Malkin is chairman emeritus.
New York State Supreme Court Justice O. Peter Sherwood in Manhattan in May approved a $55 million settlement of lawsuits over the plan to take the building public, after rejecting a request to intervene in the case by investors opposed to the settlement.
The 1,453-foot (443-meter) skyscraper was the tallest building in the world until New York’s World Trade Center was built in the 1970s. Its 86th- and 102nd-floor observatories attract about 4 million visitors a year, according to its website.
The case is Ratner v. Malkin, 650029/2013, New York State Supreme Court, New York County (Manhattan).
–Editors: Andrew Dunn, Fred Strasser