Empire State Realty Trust investors have an interest in feud with the Pacifica Foundation

Empire State Realty Trust investors have an interest in feud with the Pacifica Foundation

By Lynda Carson - January 5, 2018

Whatever the fate of the Pacifica Foundation may be including it’s assets and radio stations, the investors in the Empire State Realty Trust, Inc. (ESRT) may file a lawsuit against ESRT if it does not maximize it’s profits regarding the on-going feud with the Pacifica Foundation, and WBAI. Pacifica Foundation owns the broadcast licenses for KPFA in Berkeley, WBAI in New York, KPFK in Los Angeles, KPFT in Houston, and WPFW in Washington D.C.

During October 2017, in favor of Empire State Realty Trust (ESRT), Judge Gerald Lebovits ruled with a summary judgement in a lawsuit against WBAI Radio and the Pacifica Foundation, over alleged unfair, unreasonable and exorbitant annual increases in the rent for situating the station’s transmitter at the top of the Empire State Building, in New York City.

Reportedly, Empire State Realty Trust (ESRT) may take control of the Pacifica Foundation's assets including the building that KPFA Radio is in, as soon as January 8, or January 12.

ESRT Investors Have An Interest In The Feud With The Pacifica Foundation

As an example, in July of 2014 Reuters reported that a New York judge tossed out a lawsuit regarding longtime investors in the Empire State Building who alleged that they were being shortchanged out of hundreds of millions of dollars by the real estate moguls who took the skyscraper public during 2013.

Empire State Realty Trust, Inc. (ESRT), a Maryland corporation, is trying to take control of KPFA and the entities controlled by the Pacifica Foundation over a $2 million debt owed to the Empire State Realty Trust, Inc. (ESRT) by WBAI Radio in New York City, and the Pacifica Foundation.

It is not KPFA’s fault that WBAI Radio in New York City got itself into a bad situation.

In a statement from KPFA, “Although KPFA is financially healthy, its sister station in the Pacifica Network, WBAI, based in New York, is raising very little money, and is trapped in a lease on their antenna tower that they cannot pay – it currently costs $60,000 per month, and is rising."

"In late 2016, the landlord, the Empire State Realty Trust, sued for unpaid rent. Three months ago, they won a judgment of just over $1.8 million dollars, plus attorneys’ fees. WBAI has no assets to speak of for them to seize. But since WBAI is part of the same legal entity as KPFA, they can come after KPFA’s bank account, and they can come after the building we broadcast from. They have filed paperwork in California that would allow that as early as this Monday."


"And yet, in the three months since that judgement – and in the more than one year since the lawsuit was filed – Pacifica’s governing board of directors has been unable to commit to any actions that would protect its assets.”

Additionally, according to Quincy McCoy, General Manager of KPFA Radio in Berkeley, “WBAI owes the Empire State Realty Trust $1.8 million in delinquent transmitter rent. [Plus more delinquent rent since April, not covered in the suit.] ESRT filed in court against Pacifica on Nov. 23, 2016. Their monthly rent is currently at $53,000 per month, escalating each month. On Oct. 4, a judge found in favor of ESRT making it possible for them to file in all states where Pacifica has properties, allowing them to seize money and property.”

“ESRT is demanding over $2 million for unpaid tower lease costs, holding the network hostage in an annually escalating contract involving increases of about 9 percent per year. ESRT is a multinational corporation that held $554.4 million cash and cash equivalents as of December 2016 and owns billions of dollars of real estate.”

“After the destruction of the Twin Towers in 2001, broadcasting stations in the NYC area had few options for antenna space rental. ESRT took advantage of its position in the market. In 2005, their owners negotiated a highly questionable contract with Pacifica. ESRT has refused to release Pacifica from the contract, which is scheduled to continue until 2020.”

"What is the PNB doing? The governance structure of Pacifica, our historic culture of the usual political infighting, etc., has led to disagreement and paralysis. Unless action is taken pretty immediately we may cease to exist. You deserve to understand where things stand. I could wait no longer."

According to Bill Crosier, interim Director of the Pacifica Foundation, Pacifica is in debt by around 8 million dollars in total. He also stated that Pacifica owes a lot of money for pensions, including a debt to Democracy Now! According to public records in 2013, for programing services Democracy Now! was owed $641,032 by the Pacifica Foundation.

Reportedly, as recent as January 2, 2018, the Pacifica National Board (PNB) voted to approve 2 loans to partially pay off the debt to Empire State Realty Trust (ERST), in hope that ESRT would not seize Pacifica’s assets. Bill Crosier declared, “We have reached a point where Pacifica’s interests in its assets are in imminent danger of being seriously damaged.”

On January 5, during a live KPFA broadcast, it was revealed that some of the board members of PNB would be involved in the loans, and would be collecting interest on the loans. When asked why the PNB approved of loans instead of filing for Chapter 11 bankruptcy, Bill Crosier stated that some of the board members did not believe that ESRT would seize the assets of the Pacifica Foundation. Crosier supported going into bankruptcy, rather than getting loans.

Regarding the loans, on Jan. 5, 2018, during the same live broadcast question and answer session on KPFA Radio, it was not really clear what the board members of the Pacifica Foundation have done to come up a real with solution to pull out of the immediate crisis the organization finds itself in with the Empire State Realty Trust.

Ominously, near the end of the broadcast when a caller named Jeff from Berkeley suggested that with all the infighting going on in Pacifica, that it seems like someone is destabilizing the boards so they can get a hold of Pacifica’s radio licenses. In reply, Bill Crosier stated, “I can’t tell you that it’s not true.”

KPFA is the first listener sponsored radio station in the United States, and some the legendary history of the radio station is known across the country, and the planet.

A community based listener supported radio station, KPFA has supported the local community for many years, and would be sorely missed if ESRT were to take over the station and Pacifica’s assets.

Lynda Carson may be reached at tenantsrule [at] yahoo.com

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