By Daniel Geiger
L&L Holding Company dropped a lawsuit yesterday against Barclays that alleged it had a right of first refusal to acquire the distressed office building 475 Fifth Avenue.
The elimination of the suit, which L&L launched against the British bank in early May, would appear to pave the way for the nearly 300,000 s/f building’s sale.
Last month Barclays hired the real estate services firm CB Richard Ellis to handle leasing and management at the nearly vacant property. The bank then tapped a CBRE investment sales team led by top company executives Darcy Stacom and Bill Shanahan to market the property for sale. But the prospect of legal wrangling with L&L, which Barclays had tapped in 2009 to manage the building, appeared as if it would at least temporarily stall efforts to sell the building.
Barclays took control of 475 Fifth Avenue in 2009 after a partnership between the real estate investors Joe Moinian and Westbrook Partners defaulted on the mortgage Barclays held against the property. Moinian and Westbrook had purchased the building at the height of the real estate market in 2007 for $163 million and cleared it of tenants, undertaking a renovation to convert the asset into a high-end office building. The plan stalled when the economy fell into a deep recession.
L&L’s suit claimed that its arrangement to act as an asset manager for the property entitled it to a right of first refusal to buy the building. Barlcays responded in a statement that L&L’s acquisition options had expired.
“L&L’s allegations are completely without merit,” a Barclays spokesman said last month in a statement, responding at the time to L&L’s suit. “Barclays made an offer to L&L that fully complied with the terms of the agreement and L&L chose not to accept the offer before the Right of First Offer period expired. As a result Barclays no longer has any obligation to offer to sell 475 Fifth Avenue to L&L. We are confident that we acted at all times in good faith with respect to the terms of the agreement.”