Rent Dispute Threatens Plans for Controversial NY Mosque and Community Center


October 17, 2011

A complicated rent dispute is the latest obstacle for Park51, the controversial project to build a mosque and community center in lower Manhattan.

Park51 developer Sharif El-Gamal, whom we profiled last month, recently received a letter from Consolidated Edison, which owns a portion of the property, demanding Park51 pay $1.7 million in back rent or face eviction and termination of the lease.

But El-Gamal has filed a lawsuit disputing Con Ed’s math and arguing the rent owed is about half that amount.

Park51’s developers own a five-story building on the western half of the property and lease the substation on the eastern half from Con Ed. Their plan is to knock both buildings down to build the mosque and community center.

Since August 2008, Park51 has been paying $33,000 in rent a year until both sides could come to an agreement on the fair value of the property. At that point, both sides agree, Park51’s developers would pay rent retroactively, based on the adjusted amount.  El-Gamal claims Con Ed’s math in calculating the adjustment is faulty, and that Park51 only owes $881,519 in back rent.

“Whether it is bowing to political pressure or seeking to retain the valuable premises for itself, Con Ed appears intent upon proceeding with the wrongful termination,” El-Gamal said in court documents.

But Con Ed rejects these claims, maintaining that the company is simply following through on its “fiduciary obligation” to shareholders by pursuing the outstanding rent.  “We have been among the parties that have defended the tenant’s right to buy the property,” Allan Drury, a spokesman for Con Ed, told The New York Times.

El-Gamal says that terminating the lease will imperil the entire project, and he has obtained a temporary court order barring Con Ed from taking action.  A hearing is scheduled for Nov. 17.

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