The Commodore Hotel at 42nd Street and Lexington Avenue in the Upper East Side was completed in 1919 as part of Terminal City, a complex of hotels and office buildings connected to Grand Central Station. Owned by the New York Central Railroad, the building was leased to the Bowman-Biltmore Hotels Corp. and designed by Warren & Wetmore, the same firm that designed Grand Central Terminal.
After its doors opened in 1919, the Commodore boasted the “Most Beautiful Lobby in the World” — a single, open space with low ceilings and a waterfall designed by John B. Smeraldi. With its glass roof, plastered walls, decorative plants and indirect light, the lobby transported guests to a Mediterranean courtyard – unlike the elaborate and expensive decorative programs seen in most New York hotels of the time.
The hotel was successful until the late 1970s, when Central Railroad — renamed The Penn Central Transportation Co. — went bankrupt and sold the Commodore to a young Donald Trump in 1977. Seeking to rescue the aging hotel from bankruptcy and foreclosure, Trump orchestrated one of the most famous real estate deals in New York City history. With the Hyatt Corp. as partner, the Trump Organization purchased the Commodore and negotiated a contract for a 40-year tax abatement provided by the city’s Urban Development Corp.
Trump and Hyatt decided to rebuild the hotel, completely gutting the first few floors and covering the entire exterior with a mirrored glass façade as part of a $100 million renovation. With its signature sleek, mirrored glass exterior, the new Grand Hyatt signaled the revival of New York after the fiscal crisis of the 1970s and is often credited with turning around the deterioration of the Grand Central area – a neighborhood that, at the time, was threatened by multiple foreclosures.
Today, the newly renovated 32-story hotel is owned entirely by the Hyatt Corp.; Trump sold his interest for $140 million in 1996, ending a tumultuous 17-year partnership between the two firms.
An Assistant Corporation Counsel at the time, Leonard Grunstein helped negotiate the financeable ground lease structure that permitted the Trump Organization’s redevelopment of The Commodore. In addition, Grunstein was involved in coordinating the closing of the acquisition, working with all of the financing partners, the MTA (including in connection with construction and other easements), the UDC and other city agencies.
Leonard Grunstein 