Jacob Chetrit Acquiring SL Green’s News Building for $815M
SL Green has entered into a contract for the sale of 220 East 42nd Street with an expected close in early 2020
By Cathy Cunningham and Sarika Gangar October 1, 2019 5:33 pm
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Jacob Chetrit is the buyer behind SL Green (SLG) Realty Corp.’s announced $815 million sale of the 37-story News Building at 220 East 42nd Street in Midtown East, Commercial Observer has learned.
Chetrit, of the New York-based The Chetrit Organization, will be acquiring the property in a deal that’s expected to close in the first quarter of next year, sources said.
Robert Verrone of Iron Hound Management arranged the sale along with Adam Spies and Doug Harmon of Cushman & Wakefield. Verrone is also in charge of negotiating the financing for the trade. The executives either did not respond to requests for comment or could not be immediately reached.
SL Green has entered into a contract for the sale of the property, located at the corner of 42nd Street and Second Avenue, with the sales price translating to about $715 per square foot, according to a statement from the New York-based REIT. The firm did not disclose the identity of the buyer. A SL Green spokesperson declined to comment.
The firm picked up the property, which originally housed the headquarters for the New York Daily News, for $265 million in early 2003, about two years after making a $53.5 million preferred equity investment. It has since completed a repositioning and re-tenanting of the Art Deco building. Today, the building is 97 percent leased and many of the leases are for 30 years, one source said of the building’s draw.
“The sale of the historic News Building demonstrates the continued demand, both international and domestic, for large, fully-stabilized assets in East Midtown,” said Isaac Zion, SL Green’s Co-Chief Investment Officer, in prepared remarks. “This sale also furthers our strategy of selling assets into a healthy investment market and using the proceeds from these sales to repurchase deeply discounted shares of our stock while maintaining a low leverage profile.”
The REIT has also been busy with development projects; it topped off its One Vanderbilt tower in Midtown last month and is getting ready to begin construction at One Madison Avenue in Midtown South.
The News Building is 97 percent leased to tenants including the Visiting Nurse Service of New York, Omnicom Group, local television station WPIX and the United Nations. WPIX’s parent company, Tribune Media Company, signed a 16-year renewal for the broadcaster’s 101,568-square-foot offices, SL Green announced in July.
