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Auditor: Apple got sweetheart deal on Grand Central lease

Written by Andre Yoskowitz (Google+) @ 30 Jul 2012 15:28 User comments (2)

Auditor: Apple got sweetheart deal on Grand Central lease According to an audit by New York Comptroller Thomas DiNapoli, Apple was given a sweetheart deal by the MTA for its massive Grand Central location lease.
The audit revealed that Apple and the MTA had already been negotiating the lease for over a year before a proposal was sent in. Metrazur, the restaurant that was occupying the space at the time, had already entered into a $5 million buyout pact with Apple, as well.

MTA officials then made it a requirement for all companies bidding for the space to pay the same $5 million upfront, a task that left Apple as the only real bidder.

'The MTA set a troubling precedent when it played favorites and gave Apple a competitive edge over others,' added DiNapoli.

MTA Chairman Joseph Lhota said the audit was worthless: "The MTA's lease process with Apple was open, transparent and followed both the spirit and letter of the law. This audit is not fact-based, and accordingly, the auditors' opinion is worthless."

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2 user comments

13.8.2012 10:24

"This audit is not fact-based, and accordingly, the auditors' opinion is worthless."

Ouch!


Peace!

24.8.2012 12:25

On one hand, city/state governments have to find ways to squeeze more money that doesn't involve raising taxes since most of the money spigots from th federal government have been shut down over the last few years. So, I applaud the MTA (which I'm assuming is a government agency or a semi-government agency like the metro system in my town) for finding creative ways to score gobs of cash from a company loaded with more cash than they can spend.

On the other hand, this was a sweetheart deal. The MTA effectively cleared all but the biggest player from the table. Since that left one guy, it's hard to argue that this wasn't intentional and sets a bad precedent for future bidding which really should be structured to have more than one player on the table for the bidding process to prevent corruption.

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