ESB REIT Plan Crosses Voter Threshold

NEW YORK CITY-Plans to launch a REIT IPO backed by the Empire State Building and 19 other commercial properties crossed a threshold this week, winning the approval of “more than the required supermajority” of shareholders in Empire State Building Associates LLC and 60 East 42nd St. Associates LLC, according to an SEC filing Wednesday. Voting will remain open for shareholders who have not yet weighed in on the proposed consolidation and IPO, a spokesman for Malkin Holdings tells GlobeSt.com. The vote was required under the agreements that established the ESB syndication in 1961.

In a separate SEC filing on May 24, Malkin Holdings informed shareholders that New York State Supreme Court Justice O. Peter Sherwood had issued an opinion and order approving the April 30 settlement of a class-action suit opposing the REIT IPO. “The 12 investors who have opted out will not receive any share of the settlement proceeds, but can pursue separate claims for monetary damages,” Malkin Holdings chairman Peter Malkin and president Anthony Malkin wrote shareholders. “They are bound by the settlement agreement regarding equitable relief, so they cannot seek an injunction to halt the consolidation or IPO.”

However, Stephen Meister, an attorney for some of the plaintiffs in the suit, told GlobeSt.com last month that he would appeal Sherwood's ruling.

The Malkin Holdings spokesman says the solicitation of shareholder votes will be terminated “in due course.” Once the voting is closed, shareholders who have not yet approved will receive written notice giving them 10 days to reverse their vote or receive a token payment of $100 per share. Bloomberg reported that the shares have been estimated to be worth more than $300,000 apiece. "We look forward to delivering to our investors what we believe to be the many benefits of this transaction," says the spokesman.