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The Carlyle Group signed a huge lease to move to SL Green's Midtown East supertall, One Vanderbilt, but the private equity firm is now suing its current landlord for throwing an unforeseen roadblock in its relocation plans.
As part of Carlyle's 94K SF One Vanderbilt lease, SL Green has agreed to take over the private equity firm's 120K SF lease at 520 Madison Ave., which runs through 2031, at a cost pegged at $100M.
In August, Carlyle asked Tishman to allow it to assign the lease to an SL Green-controlled LLC, The Real Deal reports. But Tishman Speyer has not agreed to the transfer, according to TRD, saying the lease states Carlyle can’t transfer the lease to a competitor.
In a letter, Tishman Speyer claimed SL Green leasing space in the building would put it “in direct competition" with Tishman's own leasing plans, according to TRD. Carlyle this week filed a lawsuit in the Manhattan Supreme Court arguing the lease allows for it to be handed over to a firm that is linked to a competing landlord.
“Apparently unhappy that Carlyle is leaving 520 Madison (built in 1982) for a new, state-of-the-art building (i.e. at One Vanderbilt), [Tishman Speyer] has unreasonably denied consent for Carlyle to assign the lease to [SL Green],” the suit reads.
The lease at One Vanderbilt doesn't rely on SL Green taking over the 520 Madison space, TRD reports. One Vanderbilt is expected to reach 1,410 feet once completed. Construction started there in 2016, and it has reached 34 stories. SL Green expects the building to reach 55 floors by the end of the year, and the company says it is now 37% leased.
UPDATE, OCT. 18, 5:00 P.M. ET: This story has been updated for clarity.
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