Going up! (Cushman & Wakefield)

Is there a better way to enjoy the New York City skyline than from its highest point, atop the swiftly rising 1 World Trade Center? How about with a Shackburger and shake in hand?

According to The Times, Danny Meyer's Union Square Hospitality Group is among those vying to run the new observation deck on 1 World Trade Center's crown. Why?

Observation decks like the two at the Empire State Building have become so lucrative that the bidding for the three-level attraction on floors 100 through 102 drew bidders from as far as Canada and France, as well as a local restaurant owner.

Not every bidder is as upscale as the highbrow Mr. Meyer. They also include stadium favorites like Aramark (talk about nosebleed seats) and Legends Hospitality, which runs concessions at Yankees and Cowboys games. There is also Montparnasse 56 USA, the aforementioned French company, which runs this.

And then there is Tony Malkin, saluter of 1 World Trade and owner of the very popular Empire State Building and its two observation decks, which, The Times notes, generate some $60 million in profits a year.

Speaking of the top of the Empire State Building, The Times also has a nice story about the new LED lamps that were installed at the city's formerly tallest tower. These have been years in the works, and still will not be up and running for a few months, but the pics of the prismatic possibilities are still really cool.

mchaban [at] observer.com | @MC_NYC

Still No. 1 in our hearts. (ESB)

As of today, as you probably already know, 1 World Trade Center reached the historic height of 1,271 feet, eclipsing the Empire State Building and reclaiming its place as the tallest building in the city. In honor of that achievement, the tower will be lit up red, white and blue tonight. The Observer asked Tony Malkin, owner of the iconic tower, what he thought of being No. 2 again.

“The world's most famous office building, the ancestor of all super-tall towers, welcomes our newer, taller cousin to the skyline," Mr. Malkin responded in an email. "We've watched you grow, and now we salute you." He signed it as "Empire State Building."

It is a fitting tribute, if also unusual, considering Empire State Building staff were told not to discuss its "cousin's" ascent, according to New York magazine.

Meanwhile, Curbed had a rather amusing video of the history-making column rising to the top of 1 World Trade. It underscores both the banality and the eager emotions surrounding this milestone. We have waited so long for that column to be but into place, though it is still just a 26-foot-long piece of structural steel. This is just another construction site, but also the most important one in the world.

mchaban [at] observer.com | @MC_NYC

Vacancies abound. (Vornado)

All that agita for nothing.

After fighting the bullish Steve Rothto save the Empire State Building's spot on the skyline, Tony Malkin has won a reprieve—thanks to the miserable economy.

According to the Post, Vornado is putting off construction of the 1,200-foot tower atop the Hotel Pennsylvania "until market rents reach a point where it’s worthwhile to redevelop the site with an office building."

Instead, the developer is going the unusual root of possibly investing in a building it may well tear down.

“It could cost $30 million just to renovate the rooms,” said one executive who was not authorized to speak on the record. “It’s 1,000 rooms and everything adds up.”

Vornado would also commit millions of dollars more to update the lobby and common areas.

The move makes some sense, though. While the office market may not be clamoring for more room, demand for hotels is still soaring.

mchaban [at] observer.com | @MC_NYC

The Empire is mine.

Tony Malkin may have lost his biggest fight, against Vornado's Steve Roth and the gargantuan 15 Penn Plaza, but he's having a good week, at least, winning two persnickety court battles.

The first was a challenge brought by New York Skyline, the virtual helicopter company that operates on the second floor of his crown jewel, the Empire State Building. Mr. Malkin allegedly wants the company out, because their city-fly-bys pose some sort of threat to the building's panoramic dominance. A judge earlier this week ruled that the NYPD was not in the wrong when it kicked New York Skyline's buskers off the sidewalk in front of the Empire State Building—they did not have the necessary permits, so beat it.

And just today a ruling came down that renovations Mr. Malkin made to 112 West 34th Street were reasonable, even though he does not own the building, as Crain's reports:

The judge ruled that there was no evidence that W&H made any structural changes to the 25-story, 769,000-square-foot building between Sixth and Seventh avenues.

Warren Estis, [Developer Charles] Cohen’s lawyer, said he and his client were disappointed in the verdict and plan to appeal. Anthony Malkin, president of W&H, predicted that action would fail as well.

“The case was without merit, the appeal is without merit, and we remain confident in our position, " said Mr. Malkin, in a statement.

Lawsuits? They're GRRRRRREAT!

mchaban [at] observer.com | @MC_NYC

The Christian liberal arts college currently houses its administrative offices and classroom space in 50,000 square feet on the concourse and lower levels of the iconic tower, controlled by Anthony Malkin's W&H Properties, but their lease expires in 2012, a source with knowledge of the deal told The Observer. "From a branding and a building recognition standpoint," said the source, "they love being in the Empire State building."

Negotiations for the renewal and expansion are "moving slowly" one source told The Observer and another called them "preliminary," but the deal could be wrapped up by the summer. One person said the negotiations have moved slowly while the landlord focused on the huge Li & Fung deal and also possibly on putting an Equinox gym on the lower levels. The latter deal was apparently killed.

Even without the gym, the expansion could prove a challenge: Floors in the building are around 60,000 square feet each, but other retailers, such as Bank of America and Heartland Brewery, are eating up some of the lower-level space with staircases to the basement.

King's College, which was founded in New Jersey in 1938 but moved to New York City in 1999, wants to stay at the famed address—which if nothing else makes it unlikely freshmen will get lost. "What's great," said one source, "is the Empire State Building is truly back on the map as being a desired place to do business after so many years of being passed over by the marketplace because it was seen as a neglected building."

UPDATE: Cushman and Wakefield is leading the assigment representing King's.

lkusisto@observer.com

Now, Malkin's W&H Properties, which he runs with his father Peter, have come under fire for similar renovations, though they may only be a ruse.

Just down the block from the Empire State Building, at 112 West 34th Street, W&H retrofitted the 26-story, wedding cake-style office building. The Malkins do not own the 1954 building, and instead control a 114-year lease. Now, developer Charles Cohen is suing to rescind the Malkins' lease at 112 West 34th because they altered the building's lobby and replaced the facade, according to The Times. You'd think they were doing Cohen a favor, keeping the building in a state of good repair with this $81 million renovation, but as always, there is a catch:

In concept, this dispute is not all that different from when a landlord tries to evict a tenant for unauthorized alterations, like painting the walls black or installing a washing machine. But in scale, this dispute is much greater.

The Malkins, a father and son best known for controlling one of the city's architectural symbols, the Empire State Building, have said in court that Mr. Cohen's charges are nonsense, merely a ploy to break the lease. It is easy to see why they want to preserve the lease: It was signed in 1963, lasts until 2077 and sets the current rent at $840,000 a year, a small fraction of what the Malkins receive from the office and retail tenants they have filled the building with.

So Cohen is basically looking for any excuse to kick the Malkins out, in no small part because, as one broker consulted by The Times points out, the building could easily demand more than 10 times its current rent in today's market. Kinda makes you see where the Cohens--who did not sign the lease but instead bought it up years ago--are coming from.

Still, for the building nerds among us, the most interesting part of the lawsuit is that it may hinge on semantics.

At least twice The Times refers to the Malkin's "structural changes" being an issue, as in this passage: "Mr. Cohen said the Malkins, who lease the building, had no right to affix a new glass facade to the 26-story building, at 112 West 34th, and to try to glamorize the narrow entrance with marble and an undulating 30-foot-high ceiling. The Malkins' W&H Properties, according to the lawsuit in State Supreme Court, had failed to get Mr. Cohen's permission for those structural changes, as required by a lease dating to 1963."

Yet any student of architecture can tell you that the glass-walled facades that have come to define the modern office building are, unlike their brick forebears, exactly that, a facade. They serve no structural purpose, simply an aesthetic and environmental one. In this case, both had been diminished, as the glass had faded over the years--this one of the first generation of glass curtain wall buildings in the city--and it "leaked like a sieve," according to one person familiar with the renovations. It appears Cohen wanted everyone inside the building to be as uncomfortable as he was with this deal.

mchaban [at] observer.com | @mc_nyo

But Empire State Building Associates still "failed to accomplish its major financial goal of obtaining large loans to fund an anticipated 10-year, $626 million rehabilitation of the building," according to The Real Deal. That rehab, which includes a major "green" overhaul, is meant to bring the aging building into the 21st century, so it might compete with the likes of 15 Penn and One Bryant Park.

It will never achieve the same rents as those buildings, of course, but the goal is to at least stave off irrelevance and keep occupancies up. As the Deal's Adam Pincus notes, Malkin is holding on, at least for now:

The average annual rent tenants are paying was $29 per square foot in 2009, a decline of $1 per foot compared with 2008 when they were $30 per square foot. Asking rents fell further, to a range of $32 per foot to $52 per foot, as of the end of 2009 compared with $50 per foot to $60 per foot at the end of 2008, the company's SEC filings show.

Still, as yet another high-tech tower comes online, creating more commercial space and pushing buildings more recent than Malkin's out of their Class A position, it becomes all the harder to maintain supremacy -- both on the skyline and at the bank.

mchaban [at] observer.com / @mc_nyo

The U.S.S. Intrepid, docked permanently at Pier 86 off West 46^th Street in Manhattan, announced Tuesday that its 900-foot flight-deck will be lighted blue and white on Aug. 26 in honor of what would have been Mother Teresa's 100^th birthday.

It's not the Empire State Building—which towers 1,250 feet over the city—but it's one more structure in City Council Speaker Chris Quinn's arsenal of light.

Ms. Quinn has been engaged in a war of words with Empire State Building owner Tony Malkin ever since the real estate mogul refused earlier this month to light his building blue and white in honor of the late peace activist.

Bring on the warship!

mgonda@observer.com