Cooper Union Gets Chrysler Building Rents in RFR Dispute

Cooper Union can start collecting rents from tenants at the Chrysler Building while the school and Aby Rosen’s RFR Holdings wrestle for control of the skyscraper.

A Manhattan judge on Thursday issued an injunction allowing Cooper Union to collect rents at the building, which RFR refused to relinquish control of after the school sent a notice last month terminating the ground lease.

“[RFR] cannot take any steps to interfere with Cooper Union’s management or operations in control of the building,” Judge Jennifer Schecter said at a hearing Thursday morning.

Attorneys for RFR had alleged that Cooper Union’s termination of the lease was invalid because the school sent the notice to RFR’s current offices, and not to a previous office that was listed in the lease agreement.

“That seems like the flimsiest of flimsy,” Schecter said of the argument, issuing the injunction because she believed Cooper Union will win its case.

RFR’s attorneys also argued that the reason they stopped paying rent was because the way Cooper Union handled campus protests over the Israel/Palestine conflict drove tenants away from the building.

But Schecter said RFR’s attorneys failed to cite any case law where a tenant was able to stop paying rent because of a landlord’s actions outside the property.

A spokesperson for RFR called the company’s removal “temporary.”

“Losing RFR’s leadership on this project risks not only the building’s financial stability but also its place in the heart of New York’s heritage and urban identity, marking a significant setback for those who cherish the city’s historic fabric,” the spokesperson said. “For the sake of all New Yorkers, we hope that the Attorney General and independent financial monitor, who are already involved with Cooper Union due to historical financial mismanagement, step in to make sure the Chrysler Building doesn’t fall into irreparable disrepair.”

A Cooper Union spokesperson said the school will take over operations of the building Nov. 1 when it starts collecting rents.

“We look forward to working with Cushman & Wakefield and our team of advisors to assume management of the property and to develop a long-term plan to improve the tenant experience and maximize the building’s value for the benefit of Cooper Union’s students,” the spokesperson said.

Thursday’s was the first hearing in the case over RFR’s lease at the Chrysler Building.

Cooper Union had sent Rosen’s company a termination for the ground lease, effective Sept. 27, alleging RFR owed more than $21 million in missed rent payments dating back to last year.

On the eve of the termination date, RFR sued the school, alleging that it incorrectly calculated the money owed and failed to properly serve notice.

Cooper Union sent representatives from Cushman & Wakefield to take over property management of the iconic skyscraper, but RFR wouldn’t allow them access.

“We have not sent men over with brickbats to remove them by force,” said Cooper Union attorney Gabriel Hermann of Gibson Dunn.

A sticking point between the two sides is an agreement they supposedly reached in May 2023 to amend the ground lease. Cooper Union said it agreed to lower the monthly rental payments in exchange for a lump sum, but that RFR couldn’t find the capital to close the deal.

An RFR spokesperson did not deny the 2023 agreement, saying an “economically feasible” deal had not been reached and that the company has the capital ready for a “market deal.”