Pre-Order your new iMac now from MacMall (ships Oct 23) & save hundreds in tax: Apple Price Guides updated Oct 24th (exclusive coupons)
The New AppleInsider App
 


Monday, July 30, 2012, 08:51 am PT (11:51 am ET)

New York audit finds Apple had unfair advantage in Grand Central bid

A New York state audit has concluded that the Metropolitan Transportation Authority gave Apple an unfair advantage when the iPhone maker bid for its retail location at Grand Central Terminal.

New York state Comptroller Thomas DiNapoli concluded in his report that the MTA's process "was at a minimum severely slanted toward Apple," according to the New York Post. He found that rival bidders were at a disadvantage, as they had only a 30-day window to submit competing offers.

DiNapoli found that Apple was in private talks with the MTA for more than two years until the bidding process opened up. The company eventually inked a 10-year deal with the MTA last July for a 23,000-square-foot retail space inside New York's bustling Grand Central Terminal. The store opened last December.

The state of New York announced late last year that it would investigate Apple's deal with the MTA, as DiNapoli expressed concern that the authority may have "given away the store." His final conclusion that Apple was given unfair preferential treatment was delivered to members of the MTA last Friday.

In response, the authority said DiNapoli's office has an "overt bias against the MTA and Apple." MTA Chairman and CEO Joseph Lhota issued a statement dismissing DiNapoli's audit as "not fact-based," and calling the conclusion "worthless."

"The MTA's lease process with Apple was open, transparent, and followed both the spirit and letter of the law," Lhota said.

Grand Central Apple Store


Apple's unique deal with the MTA means the company does not share any of its sales revenue with the authority. That makes Apple the only store among about 100 in Grand Central Terminal that doesn't share a percentage of its sales with the MTA.

The MTA has noted that it is collecting more than four times what it was paid by the previous occupant, Charlie Palmer's Metrazur restaurant. Apple is said to pay $1.1 million in rent for the space this year.