After nearly 20 years of legal battles, families of victims of Iranian-backed terrorism are set to receive compensation from a Manhattan office tower that had long generated income tied to the Iranian regime, despite outstanding court judgments, JTA reports.

On Monday, as fighting between Israel and Iran continues, a $318 million agreement was finalized, directing proceeds from the building’s sale to hundreds of victims. Those eligible for compensation include Jewish and Israeli families who lost relatives in attacks linked to Iran, both in Israel and abroad.

The dispute revolved around hidden Iranian ownership interests in 650 Fifth Avenue, a high-rise office building in Manhattan. Following the 1979 Islamic Revolution, Iran assumed control of the Alavi Foundation, originally established under the shah, and entered into a partnership with Bank Melli Iran, a state-owned financial institution under U.S. sanctions.

Through a network of front companies, the bank allegedly funneled tens of millions of dollars in rental revenue back to Tehran while concealing its stake in the property, in violation of American sanctions laws.

Among those who will benefit from the settlement are families and estates connected to the 2001 bombing of the Sbarro restaurant in Jerusalem, which left 15 people dead and more than 100 wounded. That attack, carried out by Hamas with Iranian backing, was among the most devastating suicide bombings during the Second Intifada.

The compensation also extends to victims of other suicide bombings targeting Israeli civilians in the 1990s and early 2000s, as well as to the family of Rabbi Meir Kahane, who was murdered in 1990.

For years, victims of terrorism obtained default judgments against Iran in U.S. courts, but those rulings went unpaid. As a result, plaintiffs were forced to pursue Iranian-linked assets within the United States. The broader litigation involved claims totaling more than $5 billion, including those brought by families of victims killed in the September 11, 2001 attacks.

US Attorney Jay Clayton said the outcome reflects years of persistent effort to locate and secure those assets.

“For nearly two decades, we pursued hidden Iranian government assets tied to a Manhattan skyscraper to ensure those funds would ultimately compensate victims of Iran-sponsored terrorism rather than terrorists and their enablers,” Clayton said in a statement.

As part of the agreement, the Alavi Foundation will be dismantled, and its holdings — including the Fifth Avenue property — will be transferred to a newly created nonprofit organization known as the Amir Kabir Foundation. The new group will operate under oversight from U.S. authorities, with governing rules requiring it to remain independent of any government influence.