Blackstone Sells Office Portion of NYT Building for $516M
Terence Cullen July 24, 2015, 3:17 p.m.
Atlanta-based Columbia Property Trust has agreed to buy the office condominium at The New York Times Building, or 229 West 43rd Street, and is seeking a $300 million bridge loan to finance the purchase.
The real estate investment company announced it would pay $516 million for the 345,701-square-foot condo comprising more than half of the 589,617-square-foot building from Blackstone Group. The 12 stories of office space are currently 98 percent leased, Columbia announced in a press release.
Some of those tenants include Yahoo, which leases 192,518 square feet on five floors, according to CoStar. Snapchat, the picture messaging app company, leases two floors for 26,167 square feet.
“Acquiring this iconic property with such strong tenancy and below-market rents at attractive pricing compared with other New York transactions enables us to increase exposure in what will be our second largest market, while spreading out lease maturities and capital commitments,” said Nelson Mills, the president and chief executive officer of Columbia, in prepared remarks.
Columbia plans to finance they buy with a $300 million six-month bridge loan, which would cover almost 60 percent of the cost, and other short-term borrowings, the company said in the release. A Columbia spokesman told Commercial Observer that the real estate firm was currently speaking with several potential lenders.
Blackstone bought the office portion of the building in 2011 for $160 million, according to The Real Deal, which first reported news of the sale. The investment firm went on to pour $105 million into the 102-year-old building and lure in new tenants. A Blackstone spokesman did not immediately return a call for comment.
The New York Times was in the square-foot building from its opening in 1913 until 2007, when it moved to 620 Eighth Avenue. Kushner Companies in May announced it purchased the 250,000-square-foot retail condo at 229 West 43rd Street for $296 million, which houses Discovery Times Square, Guy’s American Kitchen & Bar and Guitar Center, The New York Post reported. (Jared Kushner, the CEO of Kushner Companies, is also the owner of Observer Media, which publishes CO.)