Citigroup, SL Green Iron Out Buy-Back Deal for Tribeca HQ

388-390 Greenwich Street.
388-390 Greenwich Street.


After Citigroup announced it would be employing a buyback option for its Tribeca headquarters from SL Green Realty Corp., the two companies announced in a press release today that they have reached a full agreement on the sale. 

The 39-story office building at 388-390 Greenwich Street was triple-net leased to Citigroup through 2035, and under an agreement with SL Green, Citigroup reserved the right to buy the building back. The banking giant announced in January that it would be exercising that option. The two parties reached an agreement for an early termination of Citigroup’s lease and the sale is now scheduled to close in June 2016, according to the release.

As a result of the sale and lease termination payment, SL Green will see proceeds of nearly $1.8 billion, which will be used to repay some of  its corporate debt and retire old debt on the property.

“By retiring approximately $1.8 billion of debt, we further strengthen our balance sheet and enhance our liquidity position to in excess of $1.4 billion,” Marc Holliday, the chief executive officer at SL Green, said in prepared remarks. “Our long-standing, multi-faceted relationship with Citi, one of the world’s leading financial institutions, has been mutually rewarding and we look forward to continuing this important relationship for many years to come.”

SL Green first purchased a stake in the building with its investment partner Ivanhoe Cambridgé in late-2007 for $1.6 billion, city records indicate. SL Green eventually bought Ivanhoe Cambridgé  out of the property in 2014, and refinanced $1.14 billion of debt on the property with a $1.45 billion mortgage from Citigroup, Bank of China, Wells Fargo and Barclays

The move is significant for Citigroup, earlier this year having designated 388-390 Greenwich as its global headquarters. The bank has been in the process of upgrading the building, and renovations will be complete in 2019, according to published reports.

“[We] are in the process of modernizing and unifying the buildings,” said Kamran Mumtaz, a spokesman for Citigroup. “Accelerating the purchase of these buildings will result in significant cost savings. We look forward to completing the renovations to further deepen our ties to Lower Manhattan, where our company was founded more than 200 years ago.”




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