Penn Central’s Revenge
What happens when New York City throws a landmark Supreme Court decision out the window? A $1.1 billion lawsuit. On September 28, 2015, the owner of Grand Central filed suit against New York City for allegedly taking $475 million in property rights preserved from Penn Central v. New York City and giving them away for free to the city’s largest landlord. For those who have not read the legendary Penn Central case, here is what happened: New York City’s Grand Central Terminal was designated a historic landmark in 1967, which completely foreclosed its owner’s plans to construct an office tower above the terminal. The owner, Penn Central, filed suit against the city alleging an unconstitutional regulatory taking. At issue in the case was the city’s power to take private property for public uses. In what is known as the “Takings Clause,” the Constitution of the United States provides that “private property shall not be taken for public use without just compensation.” Penn Central argued that by restricting the vertical development of their property, the city had taken valuable “air rights,” thus the city was required to compensate Penn Central. The case ultimately went to the Supreme Court where the Court [read more]
