Kramer Levin Closes Lease for Universal Hip Hop Museum

On Dec. 29, 2020, Kramer Levin client Universal Hip Hop Museum (UHHM) announced that it has signed a long-term lease in connection with a much larger closing involving L+M Development Partners (L+M), the City of New York, the NYC Economic Development Corporation (EDC), NYC Housing Development Corporation (HDC), Housing Preservation & Development (HPD) and Wells Fargo. This was the culmination of over 2 years of work, with the UHHM lease a central component of the transaction. 

Kramer Levin began representing UHHM in November 2018. At that time, UHHM was in the early stages of negotiating a term sheet with L+M for 50,000 square feet of space at the to-be-constructed Bronx Point affordable housing project located on the Harlem River and 145th Street in the south Bronx. Bronx Point is a city-backed development project on a large parcel of riverfront property owned by the City of New York (and leased to L+M), and UHHM will be the anchor tenant. The project will include over 500 residential apartments, retail space and other community facility space in addition to UHHM.

The Kramer Levin team negotiated the term sheet for over a year and spent the last ten months negotiating the lease. Some of the major issues in negotiation included consent rights for alterations of the museum premises (including for museum exhibits), UHHM’s ability to sublet portions of its space, fundraising requirements and museum planning milestones, museum construction and fit-out obligations, and negotiation of condominium documents.

As we approached closing, we were introduced to the other parties in the transaction, including the City of New York, EDC, HDC, HPD and Wells Fargo.  As a result, the rights negotiated under the UHHM lease with L+M came under pressure by certain requirements of these third parties. The final few weeks of negotiations were spent primarily trying to ensure that the museum’s rights under its lease, and its ability to operate mostly unfettered by these third parties, would not be unduly burdened. Ultimately, we reached a resolution on these issues that pleased our client.

Construction of the museum space is anticipated to be completed in 2023 and UHHM plans to open its doors to the public in 2025.

The transaction was reported on in The Real Deal.