ESRT Exercises Options on 112 West 34th Street and 1400 Broadway
Empire State Realty Trust has exercised its options to purchase the ground and operating leases at 112 West 34th Street and the ground lease at 1400 Broadway for a total of approximately $734 million in cash, stock and operating partnership units, the real estate investment trust announced today.
The REIT will acquire 112 West 34th Street for $423.6 million. The purchase price consists of $87.7 million of existing mortgage debt, $115.5 million cash and $220.4 million in shares and partnership units. The leasehold in 1400 Broadway will be acquired for $310 million. The price consists of $80 million of existing mortgage debt, $85.5 million cash and $144.5 million in shares and partnership units.
The acquisition prices of both buildings were determined by an independent appraisal process. The two buildings had been optioned by ESRT because both were in litigation with Charles Cohen, the fee owner, and could not be included in the REIT’s initial roll-up process.
“There is a period of time during which valuations need to be done, then a decision needs to be made by our management and board based on those valuations,” Anthony Malkin, the chairman and chief executive of ESRT, told Commercial Observer of the process earlier this year. Mr. Malkin recused himself from the process.
Located between Avenue of the Americas and Seventh Avenue, the 743,369-sqaure-foot building at 112 West 34th Street was completed in 1954. The nearly 900,000-square-foot building at 1400 Broadway was completed at 1930. Advertising agency Interpublic Group signed an 87,000-square-foot lease at the building last year.