Between Mr. Moinian’s raising rent in the building and the lenders’ attempts to scare off new tenants, 3 Columbus Circle is now less than 20 percent occupied. On Monday, a leasing advertisement on the building’s black scaffolding read, in big white letters, “contiguous block of up to 650,000 RSF”–that’s in a 770,000-square-foot building. From CNN’s 10th-floor cafeteria across the street in the Time Warner Center on Monday afternoon, The Observer counted four construction workers painting sealant around a drain and installing glass sheathing on the fourth-floor balcony–perhaps dutifully polishing the Titanic’s banister.
In court earlier this month, Mr. Meister, a litigator’s litigator wearing a dark pinstriped suit that offset his razorback brown hair, told Judge Ramos that he wants to perform what he calls “a Ross-ectomy.” There was hushed laughter. The judge slouched and gazed through half-moon spectacles at the tip of his nose.
“It’s not that there are bad vibes,” Mr. Meister continued later.
Judge Ramos was amused: “Bad vibes?”
“It’s that there is a cancer in the building!” Mr. Meister bellowed on from a podium next to the lawyers’ table. “I have to get rid of Mr. Ross. I have to get rid of Mr. Ross, O.K.? I have got the money; he’s right here.” Mr. Meister slapped his right hand down on the shoulder of a plump man in a gray suit sitting at his hip. The only way that Mr. Moinian can take the scalpel to Mr. Ross is by paying off his $250 million mortgage.
The gray suit was a representative for SL Green, the publicly traded real estate company, run by Marc Holliday, that controls more than 30 percent of the office space in Manhattan. Mr. Holliday agreed in October to help Mr. Moinian refinance the building as part of a joint venture.
The biggest sticking point for Mr. Moinian is the $54 million prepayment penalty. Lawyers for both sides spent the majority of the 63 minutes in court arguing over the language that describes it in the mortgage document. Do 10 words between two commas on page 99–”provided that the Loan has not been accelerated by Lender,” which it has been–modify the words ahead of the first comma or behind the second? And so on.
Halfway through the hearing, Judge Ramos examined the documents in front of him, head in chin, and sighed. He pushed his glasses up his nose. There was silence for one minute and 15 seconds as he stared at the mortgage. At the back of the room, an executive sitting to Mr. Ross’ right wrapped his arm over the developer’s shoulder and began whispering in his ear. Mr. Ross stared down at his dangling right loafer and nodded gently. At the end of the silence, Judge Ramos scratched his head and read the clause aloud. “… And then there’s a comma.”
“I am not going to try to argue with your logic,” the judge said, “but I have to deal with the document as written.”
Later, when discussion of existing examples of foreclosure practice came to a head, Mr. Meister gently hip-checked the skinnier Mark Walfish, Deutsche Bank and Related’s lawyer, away from the podium to get a point in. Mr. Walfish was not amused: “Judge, this is great–this is like The Jerry [Springer] Show.”
“I want to talk to the two of you in the back,” the judge said. Mr. Meister continued to press his point forward. “In the back, right now!” The lawyers followed the judge out of the room.
Twenty minutes later, the lawyers emerged from the judge’s chambers. “I need Joe. Is Joe here?” called Mr. Meister. Mr. Moinian and Mr. Ross, still yet to acknowledge each other, returned with their lawyers to see the judge. Twenty minutes later, they left without a word.
Nothing was settled.
On Nov. 24, the day before Thanksgiving, a representative for Mr. Meister’s office dropped off at the State Supreme Court a Bank of America cashier’s check signed by SL Green Management for $258,550,838.52. The numbers run to the edge of the paper. If Mr. Ross picks up the check by Dec. 6, the dispute is over and Mr. Moinian will have a new financier. If they leave the check in the court’s vault, litigation over the prepayment penalty will continue, with Mr. Ross losing more than $70,000 in interest daily.
Nobody has any idea what Mr. Ross’ next move will be.
“By the way, why would any lender turn that down?” Mr. Meister asked The Observer, referring to an earlier offer turned down by the lenders that included the prepayment penalty in escrow. “Think about that! Why would any lender whose real goal is to get repaid turn that down? That proves that they’re predatory! The only reason to turn that down is because they want to steal the building. That’s the only reason, O.K.?”
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