The StreetEasy co-founder and former CEO is embroiled in a bitter legal dispute with McDonald’s over the construction of an allegedly illegal posh penthouse atop a Manhattan condo building — replacing the rooftop the fast-food giant claims it owns.
According to the lawsuit filed just before Thanksgiving, Michael A. Smith, who sold popular realtor site Zillow in 2013 for $50 million, owns a penthouse apartment at 147 Reed Street in Tribeca — which includes four outdoor decks and a swimming pool. McDonald’s
It was expanded in 2007 and totals 3,700 square feet above a five-story condo project called Tribeca, which was built in 1987 and included 149 Reade Street, 165 Chambers Street, and 303-307 Greenwich Street.
McDonald’s claims it purchased four commercial units in 1990 and negotiated several easements – one of which, according to court documents, allowed the company to install a cooling tower on the roofs of 147 and 149 Reade, Which was first reported by Bloomberg News.
According to the company, it used the space until 2006, when it replaced the cooling tower with a new system that did not require it to take up rooftop space.
The following year, Smith received approval from the board to expand the penthouse unit, which involved demolishing the portion of the easement to which McDonald’s claimed rights.
According to court records, McDonald’s wants the roof restored to its original condition and is seeking at least $10 million in damages.
In 2012, McDonald’s said it faced “serious HVAC problems” and needed to install a water tower and condenser. The company said it never gave up its rights to the space on the rooftops.
There was a back-and-forth between McDonald and the condo board for years. The board, which Smith chaired at the time, rejected McDonald’s request to install its HVAC unit in the condo courtyard.
According to the lawsuit, in 2021, McDonald informed the board that it was exercising its original easement.
But a consulting engineer told the company that the roof space “no longer exists” because a penthouse was built over it.
Smith claims that the board properly approved the renovation plan in 2007 and that the work was fully completed and visible by 2010.
His attorney Emily Reisbaum cited Bloomberg’s 2021 motion to dismiss in which Smith says the statute of limitations had expired.
The Post has sought comment from Riesbaum and McDonald.
Smith co-founded StreetEasy in 2006 with Sebastian Delmont, Doug Chertok, and Natalie Kogan.
After cashing out in 2013, he has held a number of executive positions at several tech companies.
According to Bloomberg News, Smith’s penthouse has been the subject of controversy before.
In 2021, the condo board alleged that Smith abused his position as chair to mislead fellow owners about the expansion. The board, which alleges Smith concealed the true extent of the penthouse expansion, is seeking damages of at least $5 million.
