The opinion of the court was delivered by: BRUCHHAUSEN
BRUCHHAUSEN, District Judge.
Beiserman Realty Corporation moves for an order directing the payment to it of the sum of $23,500, deposited in the Registry of this Court, as estimated just compensation for the taking of Parcel 2 herein. 40 U.S.C. § 258a authorizes such deposit.
McDonald Parking Lot, Inc., lessee of a tract, including Parcel 2 opposes such payment and makes claim for the payment to it of upwards of $20,000 for alleged damages it claims to have sustained.
The property taken by the Government is the land, described by metes and bounds in the declaration of taking, including all buildings, structures or improvements to the land, which constitute a part of the realty, all appurtenances thereto and all estates or interests therein. Such a taking comprises real estate only. What constitutes real estate is determined by the law of the State wherein the property is located. United States v. Certain Property, etc., 2 Cir., 306 F.2d 439, 444.
Prior to the taking, Beiserman Realty Corporation was the owner in fee of a parcel of real property, situated on the East side of McDonald Avenue, distant 100 feet south of Albemarle Road, in the Borough of Brooklyn, City of New York. It has a frontage on McDonald Avenue of 200 feet and a depth of 100 feet. On February 21, 1958 Beiserman entered into a lease of said parcel to McDonald Parking Lot, Inc., for the period of eleven years, commencing February 1, 1958 at a rental of $6000 for the first year, graduating upwards to $7200 for the last five years of the term. The lease set forth that the demised premises were to be used and occupied for the parking and storage of more than five vehicles and offices. By the declaration of taking, filed by the Government, it acquired title by eminent domain to the southerly forty feet of the aforesaid parcel. Upon the land so taken was a brick building, erected and owned by Beiserman and not by the lessee.
It is likewise not disputed that the lease contained various provisions, including the following:
"* * * All alterations, decorations, additions, or improvements (including paneling, partitions, railings, mezzanine floors, galleries and the like) except movable trade fixtures made by either party, shall become the property of landlord upon installation, unless landlord shall elect otherwise * * *.
"10. If the whole or any part of the demised premises shall be acquired or condemned by Eminent Domain for any public or quasi public use or purpose, then and in that event, the term of this lease shall cease and terminate from the date of title vesting in such proceeding and Tenant shall have no claim against Landlord for the value of any unexpired term of said lease.
"66. Any provision of Article 10 to the contrary notwithstanding, in the event not more than 20% of the area of the demised premises shall be acquired or condemned by eminent domain for any public or quasi-public use or purposeThen and in that event, the term of this lease shall continue and the demised premises shall be the balance thereof not the subject of condemnation and the tenant shall pay the rentals reserved herein for the said balance of the demised premises without diminution or abatement of any kind.
"Nothing herein contained shall give to the tenant any claim against the landlord for the value of any portion of the demised premises taken in condemnation or the value of any unexpired term of said lease nor shall this Article in any way limit Article 10 of this lease except as hereinabove specifically provided."
The lessee claims that it is entitled to damages of upwards of $20,000. The major portion thereof it attributes to the diminution in value of the portion of the leased property which remained after the taking.It admits that Parcel 2, the land so taken by the Government, does not constitute more than twenty percent of the demised premises. The lessee contends that if the aforementioned paragraph 66 of the lease becomes operative then the lease, by its terms, will remain in full force and effect for the remainder of the term without any apportionment of the rent; that although the parking lot is diminished in size by approximately one-fifth, the lessee will be obligated to pay the full rental, prescribed in the lease, for the remainder of its term, just as if there were no taking of one-fifth of the entire parcel; that ...