Rainbow Room is Feeling the Heat of The Foreclosure Crisis

Rainbow Room that had debuted during the worst days of the Great Depression is now feeling the heat of the foreclosure crisis. Visitors to Manhattan take the lifts to the 65th floor of Rockefeller Centre to drink in the majestic view and swallow some froth and bubble in the famous Rainbow Room.

But the glamorous watering hole that had once tempted in celebrities like Frank Sinatra and Richards is scheduled to be shut down on 12th January. The Rainbow Room is the recent victim of the recession of depression – call it what one may. Only a week previously the announcement was made by the Cipriani group of restaurants that run this famous space with its breathtaking view of New York and revolving dance floors. The Rainbow Grill is part of this space that is going to be shut down. The root cause is a stinging rental battled between Cipriani and those who own the skyscraper – Tishman Speyer Properties. The curtains closed on 9th January with Cipriani being evicted.

Cipriani termed the eviction notice as “frivolous” and alleged that Tishman was throwing them out to replace the dining tables and bars with office furniture so as to earn more. Cipriani has many eateries and restaurants dotted across Manhattan as well as in Europe. It complained that they were dealing with a landlord who was greedy and had no compassion and who has not made any attempt to resolve matters reasonably.

Tishman quickly answered by saying that it had no intention of replacing Rainbow Room with corporate offices. If they did so they would have to face strong opposition. Jacqueline Kennedy Onassis had met with similar trouble when she tried to have developers change the face of Grand Central. Robert Lawson speaking on behalf of Tishman admitted that the Rainbow Room is one of the greatest institutions of New York. They would soon try to find another restaurateur who would run the place in an excellent way just suitable for New Yorkers and the visitors.

Tishman contends that Cipriani is holding a lease that does not expire till 2013 but it is four months behind in its rental payment. The amount is $5000,000 per month for the area that is inclusive of a grill eatery and business club. Apart from the rental dispute there are other issues related to assets that have been simmering for quite sometime.

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