New York’s Chrysler Building Sold at a Huge Discount

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Category: Business

Listening

Unlocking Word Meanings

Read the following words/expressions found in today’s article.

  1. skyscraper / ˈskaɪˌskreɪpɚ / (n) – an extremely tall building normally found in cities
    Example:

    The city of Dubai has skyscrapers that stand more than 500 feet tall.


  2. lease / liːs / (n) – an agreement that allows occupation of a property during a specific time for a certain price
    Example:

    The lease of the office space will expire next month.


  3. lure / luɚ / (v) – to attract
    Example:

    Advertisers use creative TV commercials to lure customers to buy their products.


  4. up-to-date / ˈʌp tə ˈdeɪt / (adj) – modern or latest
    Example:

    Clothing brands have to be informed of up-to-date fashion styles to attract customers.


  5. amenity / əˈmɛnəti / (n) – a feature that makes something convenient or enjoyable
    Example:

    The airline offers fancy in-flight amenities for business class passengers.


Article

Read the text below.

The Chrysler Building, a well-known skyscraper in New York City, was recently sold at a discounted price.


Built in 1930, the building was considered as the world’s tallest structure at the time. The building was declared a National Historic Landmark, a property that showcases the rich history and culture of America, in 1976. Many architects perceive it as New York’s greatest building.


In 2008, the Abu Dhabi Investment Council bought a 90% stake of the Chrysler Building for $800 million.


However, early this year, Austria’s largest real estate company Signa Holding and New York-based firm RFR Holding reportedly bought the building for only $150 million.


The building was sold at a huge discount because the deal did not cover the annual rent of the land where the structure stands. Cooper Union art school, the land’s owner, significantly increased the rent over the years. The initial amount of the lease was $7.75 million a year. This amount eventually became $32 million in 2019 and is expected to increase again to $41 million in 2028.


Aside from paying an expensive rent for the land, potential new owners of the Chrysler Building are expected to face more challenges. As the building currently has a low occupancy rate, new owners need to lure more tenants. However, the owners will have to make the spaces more competitive in the market since the building is competing with more modernized office towers, which offer more up-to-date amenities, in the area. Because of this, an investment of around $200 million will be needed to renovate and upgrade the Chrysler Building.


Viewpoint Discussion

Enjoy a discussion with your tutor.

Discussion A

• If you were the owner of the Chrysler Building, would you also sell it at a discounted price? Why or why not?
• If you were offered to buy the Chrysler Building, would you buy it? Why or why not?

Discussion B

• If you were to buy a property, what factors would you consider (e.g. location, price)? Discuss.
• Would you be willing to invest in a low-cost property that would require major/costly renovations? Explain.