Tishman Speyer has signed a 150-year ground lease for the Chrysler Building with The Cooper Union and will invest $235 million to restore the 77-story Art Deco tower at 405 Lexington Avenue. Under the deal, announced October 7, 2026, the building will be repositioned as a boutique office property, and the lease payments will support Cooper Union’s plan to restore free tuition.
Key Takeaways
- The 150-year ground lease includes a $235 million investment plus ongoing ground lease payments to Cooper Union, which has owned the land under the tower since 1902.
- Canada’s Public Sector Pension Investment Board (PSP Investments) is the lead investor in a group of institutional partners, and the deal is financed entirely with equity.
- The 61st floor, where the tower’s eagle gargoyles sit, will become an indoor-outdoor tenant lounge with food and beverage service.
- Tishman Speyer will prebuild 75 percent of current and upcoming vacant space as move-in-ready suites.
- The plan restores the facade, polishes and renews the stainless steel crown, and replaces mechanical, elevator, electrical, and air handling systems.
- Tishman Speyer first acquired the building in 1997 and sold its final stake in 2019, so this deal brings the firm back to the property.
A 150-Year Lease Returns Tishman Speyer to Lexington Avenue
Tishman Speyer knows the Chrysler Building well. The firm acquired the tower in 1997 and later reduced its position in stages. A 2008 sale valued the building at $800 million, and Tishman Speyer sold its last 10 percent stake in 2019. Seven years later, the firm is back as leaseholder for a term that runs into the 2170s.
The partnership includes several global institutional investors, with PSP Investments in the lead. Tishman Speyer and its partners are funding both the ground lease and the redevelopment entirely with equity, so the project carries no construction debt. That matters for a 1930 tower that needs a large amount of work.
“We are pursuing an ambitious plan for the Chrysler Building,” said Tishman Speyer CEO Rob Speyer. He described the Manhattan office market as being at a historically strong moment, and the rest of the plan is built on that view.
The 61st Floor Becomes a Tenant Amenity Space
The most visible change will take place on the 61st floor of the Chrysler Building. The steel eagles at the corners of that floor were modeled on the hood ornament of the 1929 Plymouth. Tishman Speyer plans to turn the floor into a lounge with outdoor access, food and beverage service, and gathering space for tenants. A second amenity area, with fitness, wellness, and meeting rooms, will go into the building’s underground arcade.
Tishman Speyer will also prebuild 75 percent of the Chrysler Building’s current and upcoming vacant space as finished suites. The firm used the same approach at its nearby 6 Grand Central tower. Ready-to-occupy offices are meant to appeal to smaller tenants who want to move in quickly without managing a build-out themselves.
Tishman Speyer Bets on Grand Central’s Tight Office Supply
Location is central to the plan. The Chrysler Building connects directly to Grand Central Terminal, and Tishman Speyer says the surrounding submarket has very little available office space. Almost no new office construction has gone up in the neighborhood in decades, and nearby premier towers are close to fully leased.
The Chrysler Building’s direction is different from what has happened to many older Manhattan office buildings. Across the borough, a wave of office-to-residential conversions reshaping older Manhattan towers has taken Class B and Class C buildings out of the office market. Tishman Speyer is betting the opposite way. Its view is that a landmark address paired with modern systems and amenities can compete with newer glass towers for office tenants.
PSP Investments said the deal fits its focus on high-quality office assets in strong locations, carried out alongside a long-term operating partner. The pension investor also pointed to the tower’s direct link to Grand Central as a key part of its appeal.
Cooper Union Ties the Deal to Free Tuition
For Cooper Union, the lease is about the school’s finances. The private college was founded by Peter Cooper in 1859, and his children granted it the land under the Chrysler Building in 1902. That land was intended to be a permanent source of support for the school.
The new lease comes as Cooper Union works on a plan to restore full-tuition scholarships for all undergraduates. President Steven W. McLaughlin said the agreement is about “what it makes possible for generations of Cooper Union students.” The school described the lease as one part of a broader financial plan for reaching that goal, not as the full solution on its own.
The deal follows a long period of uncertainty for the site. The previous ground lease ended in 2024, and Cooper Union then ran a competitive process to choose a new leaseholder. Cooper Union Vice President of Finance and Administration John Ruth said the school reviewed several competing proposals before selecting Tishman Speyer.
Restoration Plans Target the Crown, Facade, and Building Systems
The physical work on the Chrysler Building covers both the exterior and the infrastructure. Outside, the plan calls for restoring the facade and polishing and renewing the stainless steel crown. Inside, Tishman Speyer will modernize the mechanical, elevator, electrical, and air handling systems and upgrade the cooling towers for better energy efficiency.
William Van Alen designed the tower for the Chrysler Corporation, and its decorative details reference car parts. The lobby once held an automobile showroom. When it opened in 1930, the building rose 1,046 feet over Lexington Avenue between 42nd and 43rd streets. Nearly a century later, the plan is to keep that original design and update everything behind it.
FAQs
Who Now Controls the Chrysler Building?
Tishman Speyer holds a 150-year ground lease on the Chrysler Building and leads an investor group headed by PSP Investments. Cooper Union still owns the land under the tower.
How Much Is Tishman Speyer Investing in the Chrysler Building?
Tishman Speyer and its partners are investing $235 million, in addition to ground lease payments to Cooper Union. The transaction is funded entirely with equity.
Will the Chrysler Building’s 61st Floor Be Open to the Public?
The plan describes the 61st floor as an amenity space for tenants, with a lounge, outdoor access, and food and beverage service. Public access has not been announced.
Why Does Cooper Union Own the Land Under the Chrysler Building?
Peter Cooper’s children granted the land to the college in 1902. The rent from the site has funded the school’s financial aid ever since.
What Restoration Work Is Planned for the Chrysler Building?
The plan includes facade restoration, polishing and renewal of the crown, and new mechanical, elevator, electrical, and air handling systems. About 75 percent of vacant space will be prebuilt as finished office suites.
