A landmark Carnegie Hall-area co-op has taken center stage in a drama over whether the city’s outdoor seating laws — which have provided a lifeline to restaurants during the pandemic — have gone on long enough.
The Osborne, an 11-story brown-brick building across the street from the famed concert hall, wants its longtime commercial tenants — which include a bar, a diner and a pizza joint — to scrap their outdoor seating or have their leases terminated, according to a lawsuit obtained by Side Dish.
Residents of the co-op, built in 1885 at 205 W. 57th St. and run by the Osborne Tenants Corp., are fed up with the “three-ring circus” they find outside their staid doors — where legendary conductor Leonard Bernstein and pianist Bobby Short once lived.
“There are tables everywhere, food and people are outside until later than 1:00 a.m., there are reports of crowds, people sleeping outside maybe after getting inebriated at the bar. One subtenant apparently set up a hostess podium on the sidewalk,” said Steve Sladkus, the lawyer representing the co-op board, according to the lawsuit.
The businesses have fought back, saying in court they are in full compliance with the city’s Open Streets program, which is now a permanent plan that helps restaurants expand their footprint with outdoor dining on certain streets and sidewalks.
“The Osborne says there’s a three-ring circus, but we don’t know what they are referring to,” said lawyer Joseph Goldsmith, who represents two of three restaurants — Carnegie Diner, and Pizza and Shakes. “There are catchphrases people have against the Open Streets program that is not specific to these restaurants. People aren’t outside til 2 or 3 am. No one is passed out in the gutter sleeping and hungover. We don’t know what they are talking about.”
The resulting food fight on the well-heeled sidewalk along Billionaires’ Row has led to a complicated legal battle involving a third party — 57th and 7th Associates — which has managed the leases of the seven retail spaces since 1962.
One of those, PJ Carney’s, has been a fixture at the corner of Seventh Ave. and W. 57th St. since 1940.
“Our customers are the people who service the people who live in the neighborhood,” said Meaghan Fitzgerald, the general manager and co-owner of PJ Carney’s. “Some people may have a different idea of what the neighborhood should be, but we are part of the neighborhood. We’re not upscale, with whiskey tastings, but we’re also not a college bar with bras hanging upside down. We’re a sedate family business, as far as Irish bars go. I don’t know what the end game is here.”
Fitzgerald’s family, which has owned the 50-seat bar since 1982 and added 10 tables along W. 57th St. during the pandemic, depicted the legal battle as one between the old guard and the rich snobs who have infiltrated the area.
“We managed to exist in relative harmony for decades but as the neighborhood transitioned into Billionaires’ Row, the Osborne building became increasingly ill-disposed towards us,” she said.
The co-op board refuted claims they are picking on Carney’s or the other blue-collar establishments, which still have nine years left on their leases.
Sladkus called the outdoor seating and the neon signage an eyesore as he pleaded his case as a defendant last month in the case brought by 57th and 7th Associates in State Supreme Court.
“This has nothing to do with class warfare,” Sladkus told Side Dish. “It has to do with complying with the basic terms of a lease. That’s why you have leases. There are no more restrictions on indoor dining. All the building wants is to restore how things were pre-COVID. The outdoor seating has created a three-ring circus outside and it has to stop.”
The lawyer for 57th and 7th, Daniel Ansell – of Greenberg Traurig – declined to comment.
Judge Andrew Borrok, who was pressed in to hear the emergency case, ordered the Osborne not to take any action against the subtenants until the original judge weighs in on whether the restaurants are in compliance with their leases. The next court date is set for July 8.
“The little mom-and-pops are being intimidated by a coop board run amok, shooting a butterfly with a cannon,” a source involved in the case told The Post. “They are bullying the tenants in the middle of a really difficult economy. …. Why pick on the little guys? The restaurants are using tables and chairs because no one is eating inside. They went militant over silliness.”
Restaurateur Stathis Antonakopoulos, who runs Carnegie Diner and Pizza and Shakes, said he has removed 60 outdoor seats along W. 57th St. after the Osborne launched a sidewalk renovation construction project. The 30 seats he has on Seventh Avenue are key for survival.
“They don’t like the look of it,” Antonakopoulos said. “I respect the tenants. We have a great relationship. But the people managing them aren’t part of reality and have no idea what a restaurant has to do to survive during COVID. Half of all New York City restaurants closed. We paid our rent and kept all of our employees. I think they are unfair and unthoughtful. We lost more than $1 million during the pandemic but we still kept the restaurants open.”
He added that during the pandemic, when Carnegie Diner was closed, there were homeless people on the sidewalk.
“If they want me to remove the tables, there will be tents on the streets again. Right now, we have nice flowers and everything is clean. The tables don’t bother anyone. Their argument is just leverage for negotiations. We feel like a pawn on the chess board,” Antonakopoulos said.
Borrok expressed sympathy for the leasing agent, saying that 57th and Seventh was like “the ham between two slices of bread” as it works with both the Osborne and its commercial tenants, according to court records.
“The mayor created open streets so restaurants could earn a living, and now two of the restaurants have tables and chairs on the sidewalks,” said the source involved in the case. “But the Osborne isn’t the Taj Mahal. They’re not the aesthetic police of 57th St. but they’ve taken it upon themselves to harass the little people. Don’t they have anything better to do?”
Added Andrew Rigie, executive director of the New York City Hospitality Alliance: “The Open Restaurants outdoor dining program saved thousands of restaurants from going out of business and is credited with bringing back 100,000 jobs, not to mention the fact that New Yorkers and visitors love dining alfresco.”
Two women dining at Carnegie Diner on Tuesday said the outdoor dining should stay.
“I would be so sad to see them lose this space,” said a real estate broker, who works on the next block and eats at Carnegie Diner a few times a week with her assistant.
The broker scoffed at the idea that diners were creating a ruckus or a “three-ring circus.”
“It’s been absolutely perfect. Lunch is never crazy or excessive. It’s got the perfect normal flow of people,” she said, adding, “who wants to sit indoors in the summer or even in the winter. They have great heat lamps when it’s cold. Everyone is so welcoming here. There’s so much love.”
Sladkus said it is “unfair to paint [the Osborne] in a bad light.”
“Everyone is profiting at my client’s detriment,” he said. “We want to restore the beauty of the building. Now there are people sleeping in the streets and inebriated. To make this seem like a snobby building stomping on the little people is absurd.”
This is not the only skirmish along Billionaires’ Row.
Last week, a W. 58th St. homeless shelter quietly opened in the former Park Savoy Hotel, next door to an entrance for 157 W. 57th, the first supertall condo on Billionaires’ Row and home of the city’s first $100 million apartment. The shelter opened following four years of court battles that ensued after the city announced its plans to open the shelter back in 2017.
In addition, some co-op owners at Carnegie House, an older residential building on Billionaires’ Row — not a new supertall — are suing the co-op board to save their home because the building must pay $280 million to buy the land under the structure or they will have to pay an extra $26 million a year in ground rent on top of the current $4.4 million a year, as my colleague Steve Cuozzo reported.