One of Manhattan's most iconic towers is back in familiar hands after falling on hard times.

Tishman Speyer has signed a 150-year ground lease with private college Cooper Union for the landmarked, art deco-style Chrysler Building, agreeing to pay $235M plus future ground lease payments, the amounts of which weren't disclosed.

The global real estate giant — which is headquartered in its signature asset, Rockefeller Center — acquired the building with backing from a group of institutional investors, led by the Public Sector Pension Investment Board. It now plans to reposition the 77-story skyscraper at 405 Lexington Ave. as a 1.3M SF boutique office tower, deploying 100% equity toward the project.

“We are pursuing an ambitious plan for the Chrysler Building at a historically strong moment for the Manhattan office market,” Tishman Speyer CEO Rob Speyer said in a statement. “We are thrilled to lead this beloved building's next chapter.”

Cooper Union owns the land under the building and uses revenues from the ground lease as permanent financial support for the school. Escalating rent payments — from $7.8M in 2018 to a high of $32.5M — have been the main cause of its deteriorating value in recent years.

RFR teamed up with Austrian real estate firm Signa Holding GmbH to buy the tower in 2019 for just over $150M, 11 years after the Abu Dhabi Investment Council paid $800M for a 90% stake in the skyscraper.

Tishman Speyer, which paid $220M for the ground lease in 1997, sold its 10% stake in the building and relinquished management to RFR.

But in November 2023, Signa filed for insolvency and inadvertently kicked off a chain of events that led to Tishman Speyer once more becoming the tower’s owner.

The 1,046-foot art deco tower deteriorated after the onset of the pandemic, with tenants telling The New York Times in 2024 that there were cracks in the ceiling and rodents scurrying through the ground-floor retail space.

RFR and Signa stopped paying rent and weren't able to complete planned renovations to the tower, leading Cooper Union to begin eviction proceedings in September 2024.

A bitter legal saga ultimately ended in a judge siding with the university the following January and allowing it to eject RFR from the property. Cushman & Wakefield has been managing it since then.

The planned extensive building improvements include turning a majority of vacant or soon-to-be-vacant space into prebuilt office suites. About 14% of the building was vacant as of February, according to CoStar information reported by the New York Post.

The new ownership also plans to turn the 61st floor into an amenity space, complete with a clubhouse containing an outdoor terrace and food and beverage offerings. It will also use the space below the lobby for wellness services, according to The New York Times.

Its takeover comes amid the busiest Manhattan office market in decades, on pace for the most leases signed since 2000, according to Colliers.

There is virtually no availability in Manhattan’s best-in-class office towers, spurring developers SL Green, BXP and Extell Development to embark on ambitious new office developments. Millions of square feet of offices have been taken offline for residential conversions, tightening the market at the lower end as well.

The Grand Central submarket, where the Chrysler Building is located, had the highest direct asking rents of all Manhattan submarkets in the third quarter at $113.45 per SF, according to Avison Young.

“For more than a century, the Chrysler Building has helped sustain Peter Cooper’s vision of opening access to education by removing financial barriers,” The Cooper Union President Steven McLaughlin said in a statement. “We have a responsibility to be caretakers of that promise, to build upon it, and to leave Cooper stronger for those who come after us. This agreement is part of an integrated financial plan that gives us the framework to confidently pursue that goal.”