MVC3 
I use in Form.cshtml

    @Html.DropDownListFor(m => m.GroupID, ViewData["GroupNameDDL"] as SelectList, "-- Select one --")    

in Controller  
    ViewData["GroupNameDDL"] = _tbl68SpeciesgroupsRepository.Tbl68Speciesgroups.Select(b => new {
      Id = b.GroupID,
      Name = b.GroupName});

TELERIK MVC
in EditorTemplate Tbl68SpeciesgroupsForeignKey.cshtml
   @using System.Collections
   @using Telerik.Web.Mvc.UI
   @(Html.Telerik().DropDownList()
        .Name("GroupNameDDL")
        .BindTo(new SelectList((IEnumerable)ViewData["GroupNameDDL"], "ID", "Name"))) 


in GridViewmodel.cs
        [Required]
        [UIHint("Tbl68SpeciesgroupsForeignKey")]
        public int? GroupId { get; set; }

In Telerik I use in Form.cshtml
      columns.ForeignKey(b => b.GroupId, (IEnumerable)ViewData["GroupNameDDL"], "ID", "Name");



How to implement
"-- Select one --"


    

columns.ForeignKey(b => b.GroupID, (IEnumerable)ViewData["GroupNameDDL"], "ID", "Name").OptionLabel("-- select --");

@using Telerik.Web.Mvc.UI
@(Html.Telerik().DropDownList()
    .Name(ViewData.TemplateInfo.GetFullHtmlFieldName(""))
    .BindTo((SelectList)ViewData[ViewData.TemplateInfo.GetFullHtmlFieldName("") + "_Data"])
    .Placeholder("-- Select one --")     !!!!!
)

columns.ForeignKey(b => b.GroupId, (IEnumerable)ViewData["GroupNameDDL"], "ID", "Name");