By Craig Karmin Wall Street Journal
Another investor is suing to stop the public sale of the Empire State Building, marking the second time in a week that investors have gone to court to halt the process.
Using similar language as in the first suit, the complaint filed on Wednesday alleges that the Malkins, the family overseeing the initial public offering process, are short-changing the investors who own the famous building.
The lawsuit says that the Malkins received excessive fees for their role as manager of the building and that the Malkins “structured the transaction to benefit their own interests at the expense of” other investors.
Like the first complaint filed last week, the second lawsuit was also filed in New York state supreme court and asks the court to block any IPO process that isn’t “fair and equitable.”
While the new lawsuit echoes the charges of the first, legal experts say it is a sign that some attorneys feel the charges could have some merit or that the investors have a case.
A spokeswoman for the Malkins said in a statement: “This is a baseless lawsuit and it goes without saying that we will vigorously oppose it.”
The Empire State Building is controlled through a complex structure in which some 2,800 investors have a say in the deal.
Last month, the Malkins filed a prospectus with the Securities and Exchange Commission to create a real estate investment trust, known as the Empire State Realty Trust Inc., that would include the Empire State Building and 17 other Malkin properties. The filing said the famous skyscraper was valued at $2.52 billion and the offering is expected to raise up to $1 billion.
Click here for link to article at WSJ website. Subscription to WSJ may be required.
Another investor is suing to stop the public sale of the Empire State Building, marking the second time in a week that investors have gone to court to halt the process.
Using similar language as in the first suit, the complaint filed on Wednesday alleges that the Malkins, the family overseeing the initial public offering process, are short-changing the investors who own the famous building.
The lawsuit says that the Malkins received excessive fees for their role as manager of the building and that the Malkins “structured the transaction to benefit their own interests at the expense of” other investors.
Like the first complaint filed last week, the second lawsuit was also filed in New York state supreme court and asks the court to block any IPO process that isn’t “fair and equitable.”
While the new lawsuit echoes the charges of the first, legal experts say it is a sign that some attorneys feel the charges could have some merit or that the investors have a case.
A spokeswoman for the Malkins said in a statement: “This is a baseless lawsuit and it goes without saying that we will vigorously oppose it.”
The Empire State Building is controlled through a complex structure in which some 2,800 investors have a say in the deal.
Last month, the Malkins filed a prospectus with the Securities and Exchange Commission to create a real estate investment trust, known as the Empire State Realty Trust Inc., that would include the Empire State Building and 17 other Malkin properties. The filing said the famous skyscraper was valued at $2.52 billion and the offering is expected to raise up to $1 billion.
Click here for link to article at WSJ website. Subscription to WSJ may be required.
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