Area under the Pershing Square Viaduct leased for restaurant.

The New York City Department of General Services and Peter L. Malkin, chairman of the Grand Central Partnership, have signed a lease to create an 8,000 square-foot restaurant under the Pershing Square Viaduct on Park Avenue between 41st and 42nd streets. The viaduct rises from 40th Street above crosstown traffic to circle Grand Central Terminal.

The Partnership anticipates the restaurant will be open within 18 months.

The area under the Viaduct that is to become a restaurant was originally used as an open trolley barn, then as the visitor center for the 1939 World's Fair, next as the Visitors' Information Center for Manhattan, and lastly, reflecting the decline that preceded the creation of the Grand Central Partnership, as a closeout discount store that went out of business several years ago. Since then, the City of New York has received no rent or taxes in connection with this space.

The City, through its Department of General Services, has leased the space to the Grand Central Partnership for a 20-year period. In return, the City will receive an annual base rent of $75,000, plus a payment in lieu of real estate taxes. An additional amount to be determined will be paid to the City from the rent collected from a private restaurant operator that will sublet the space from the Partnership. Several leading restaurateurs have expressed strong interest in operating a quality restaurant in this location.

It is part of the plan that the restaurant will open onto a plaza that would be created by the closing initially of the west side, and later the east side, of Park Avenue between 41st and 42nd streets. The west plaza will extend to the Park Avenue branch of the Whitney Museum in the world headquarters of the Philip Morris Company. The restaurant will serve food at tables in the plaza much as the new and very successful grill in Bryant Park does.

"This will be a wonderful addition to the Grand Central District and will further enhance the quality of life at this key point of entry into Manhattan," said Peter L. Malkin, chairman of the Grand Central Partnership. "The restaurant and plaza are part of the original plan for improving the District designed by Benjamin Thompson & Associates in 1985 for the Grand Central Partnership. For seven months of each of the last two years, we have had a 'phantom park' with cafe dining in Pershing Square, which has generated an extremely enthusiastic response from the hundreds of people who enjoy the park each weekday from April through October."

Daniel A. Biederman, president of the Grand Central Partnership, expressed special appreciation to Commissioner William Diamond of the Department of General Services, Commissioner Elliott Sander of the Department of Transportation, Manhattan Borough President Ruth Messinger, and Community Board 5 and its chairman.

The Grand Central Partnership completed a comprehensive environmental impact study and governmental and community review procedure in connection with this proposal. The new facilities were approved by Manhattan Community Board 5, Manhattan Borough President Ruth Messinger, the Departments of General Services and Transportation, the New York City Landmarks Commission, the New York City Art Commission, the Municipal Art Society, and the relevant City design agencies.

The project will entail the expenditure of approximately $2 million, a portion of which will come from the Partnership's capital funds raised in 1993 through the unique issuance of its own tax-exempt bonds. The debt service for these bonds is provided through assessments paid by private property owners and tenants within the Grand Central district. The new restaurant and plaza are part of this privately-financed $35 million program of cityscape improvements for the 53-square-block Grand Central Partnership Business Improvement District. The restaurateur will also make a substantial investment. No financed contribution will be made by New York City or any other public source.