A New York real estate owner is suing Amazon, claiming that the Seattle retailer reneged on an agreement to rent 10 floors in a Manhattan office building.
The Durst Organization filed the lawsuit on Friday in New York State Supreme Court, seeking $25 million in lost revenue and damages. Durst is accusing Amazon of failing to uphold a letter of intent for an 11-year lease that included 310,290 square feet of office space.
Instead, Amazon signed a deal at 7 West 34th Street across from the Empire State Building, owned by Vornado Realty Trust.
“This action seeks to redress Amazon’s blatant attempt to wrongfully evade its contractual obligations to Durst pursuant to a large scale commercial lease nearly two years in the making,” according to the complaint obtained by GeekWire.
Later, Durst accuses Amazon of blindsiding Durst “at the eleventh hour by executing a commercial lease with a third party landlord on the eve of lease-signing.”
It is that location, where Amazon was expected to be opening up its first brick and mortar store. Since those rumors first cropped up, Amazon said its sole purpose for leasing the space was for corporate offices. However, the new building is serving as a hub for its new Amazon Prime Now service, which will deliver items like paper towels and shampoo within 60 minutes of ordering.
Emails were sent to both Amazon and Durst Organization, seeking comment on the lawsuit. We will update the story if we hear back.
The building, owned by Durst, is located at 1133 Sixth Ave. The company claims it spent $1.6 million to make custom renovations for Amazon before learning the company didn’t plan on moving in. It is seeking $25 million, which equals to one year of revenue and $5 million in damages.
The lease for the space near the Empire State Building is larger and longer than the one it was allegedly seeking initially. It spans 500,000 square feet and will last for 17 years.
Forbes reports that the lawsuit filed by Durst reveals that Amazon had never been seeking retail space for a brick-and-mortar store. The initial location was in a 45-story building, currently occupied by Bank of American and TD Ameritrade. The space Amazon was considering was previously occupied by the Internal Revenue Service. In other words, not exactly the most retail-friendly environment.