Lenders Foreclose on Hell’s Kitchen’s Landmarked McGraw-Hill Building

The McGraw-Hill Building on W42nd Street is facing foreclosure after owners Deco Towers Associates allegedly defaulted on a $140 million loan package meant to convert a portion of the office tower into residential units.

Lenders Blackstone and Rialto Capital have initiated foreclosure proceedings against the owners in two separate complaints filed on Tuesday and Wednesday in Manhattan Supreme Court, Commercial Observer first reported. If successful, they would take possession of the building.

Built in 1932, the same year as the Empire State Building, the iconic 35-story office tower (330 W42nd St, bw 8/9th Ave) was one of the most pronounced markers of the New York City skyline for decades. It was originally the home of McGraw-Hill publishers, before being taken over as the offices for the Service Employees International Union. It has sat largely empty since 2020, when the union left.

The foreclosure may throw a wrench in Deco Tower Associates’ plans to convert the 12th to 32nd floors of the building into housing.

Now-defunct Signature Bank initially made the loans in 2019, which were later taken over by Blackstone and Rialto Capital. Resolution Real Estate Partners, an asset management company, had planned on embarking on a $120 million gut renovation of the building the next year, according to Commercial Observer.

On September 11, 1979 the McGraw-Hill Building (also known as Art Deco Tower) was granted individual landmark status by the city’s Landmarks Preservation Commission. In 1989, the building and the lobby were added to the National Register of Historic Places and designated a national historic landmark.

In 1978, Fred Papert, who was also President of the Municipal Art Society , described the lobby to New York Magazine as “flashy and gorgeous, bright gold and silver and green. If Fred Astaire had worked in an office building, this would have been the one.” The building was the first home of Marvel Comics, and of W42ST when it first launched.

Making reference to its historic past, the building had been marketed in 2021 with a glossy blue-and-pink Roy Lichtenstein-style website, advertising its planned renovation. The old building was placed in opposition to a character reading a comic book about “the new West Side.”

In 2020, community leaders discovered that the Landmarks Commission had authorized the demolition of the lobby . In February 2021, Theodore Grunewald, founder of the Alliance to Save the McGraw-Hill Lobby, filed suit to preserve it, but the action ultimately failed.

State Senator Brad Hoylman-Sigal, who previously called the Landmarks Commission “feckless” for allowing the demolition, told W42ST that the foreclosure could be “karma sent by the preservation gods.”

“After demolishing the historic stunning art deco lobby of the McGraw Hill Building in 2021 and numerous building code violations and stop work orders since then, the owners find themselves under water on a $140 million loan,” Hoylman-Sigal said. “I hope a more responsible steward of this iconic building will be found soon.”

The McGraw Hill building is currently facing more than 50 violations, according to the NYC Department of Buildings .

Representatives from Deco Towers Associates, Blackstone, Rialto Capital and Resolution Real Estate, did not immediately respond to a request for comment.

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