NEW YORK CITY-The Appellate Division, First Department has unanimously affirmed an early ruling from a New York State Supreme Court, which ordered the cash-strapped Metropolitan Transportation Authority to pay additional monies to the owners of land the agency acquired through eminent domain. The land is located at the future site of the Fulton Street Transit Center in Lower Manhattan, currently under construction. Demolition of the buildings at the site, east of Broadway between Fulton and John Streets, was completed in September 2007, according to the MTA website.

The claimants were DLR Properties, an affiliate of the Riese Org., and the Collegiate Church Corp., which owned the real estate in question in a joint venture on behalf of the Reformed Protestant Dutch Church of the City of New York.

Warren Estis, lead counsel for DLR Properties, tells GlobeSt.com that the ruling had to do with how the parcels of land were grouped for valuation. “The issue that the court focused in on was whether or not there was a reasonable chance that the properties would have been assembled into one parcel if they had not been condemned,” Estis says. “The MTA had argued that they shouldn’t all be valued together and the lower court and the Appellate Division found that, had it not been for the condemnation, it would have been one full assemblage.”

The ruling means that the MTA will have to pay the higher, court-determined price for the land, less payments already made. For DLR Properties, this means $11.5 million plus interest of 9% a year. It also affirmed an earlier $44.2 million judgment in favor of the Reformed Protestant Dutch Church of the City of New York and its joint venture and applied the same interest rate

“The one thing in common with the claimants was that we all took the position that the value was significantly undervalued the way that the MTA did it,” Estis says. As for the MTA’s position on the ruling, the agency released a statement to GlobeSt.com saying that it is “reviewing the decision to determine whether to appeal.”