SL Green Sells 410 Tenth Avenue for $953M
SL Green Realty Corp. has agreed to sell the Amazon (AMZN)-anchored 410 Tenth Avenue for $952.5 million in what it called the largest sale of an office building in the country since the start of the coronavirus pandemic, SL Green (SLG) announced this morning.
The landlord declined to comment on the buyer of the 20-story Hudson Yards building, but a source told Commercial Observer it was the Mark Karasick and Victor Gerstein-led The 601W Companies.
The 601W Companies and the broker on the deal, CBRE (CBRE)’s Darcy Stacom, did not immediately respond to requests for comment.
“The sale of 410 Tenth Avenue is yet another indication of the Manhattan office market’s resiliency and continued global demand for high-quality, trophy assets with credit-rated tenants,” Brett Herschenfeld, managing director of SL Green, said in a statement. “While the asset was always intended to be held as a long-term investment, the sale will allow the company to achieve extraordinary profits, substantially reduce consolidated indebtedness and generate additional liquidity for share repurchases.”
The deal is set to close in the fourth quarter of this year and SL Green will keep a 5 percent stake in the property, according to SL Green. As part of the deal, 601W will take over SL Green’s $600 million construction loan it closed on in September, The Real Deal reported.
SL Green bought the 636,000-square-foot 410 Tenth Avenue in 2018 from the Kaufman Organization for $440 million, The Wall Street Journal reported. The Kaufman Organization kept a stake in the property.
It originally considered turning the building into a life sciences hub, but SL Green instead switched gears to modernize the building with a new glass-box lobby, industrial-style windows, new elevators, a new roof deck and lounge, and the addition of double-height storefronts on the ground floor. SL Green said the work is expected to be completed in the third quarter of 2021.
Amazon leased 335,000 square feet while First Republic Bank (FRCB) took 212,000 square feet in 410 Tenth last year.
SL Green has started to offload properties around the city in recent months to help buy back stocks and provide it with funds to survive an economic downturn. It reportedly started to shop around 410 Tenth in July with a $1.1 billion price tag with Brookfield (BN) Properties considering a bid.
With additional reporting by Cathy Cunningham.