Billy Macklowe Sells Interest in Upper East Side Medical Building to LaSalle

reprints


Billy Macklowes William Macklowe Company (WMC) has sold its interest in 323 East 61st Street to development partner LaSalle Investment Management, Commercial Observer has learned. 

The deal was recapitalized at a gross value equating to approximately $95 million, or $1,280 per square foot, sources said.

SEE ALSO: Blackstone Acquires Industrial Portfolio Spanning US, Europe for $2.8B

Cushman & Wakefield’s Adam Spies, Doug Harmon, Josh King and Adam Doneger were engaged by WMC to market the sale, with LaSalle eventually acquiring its partner’s interest in the property. 

The 74,112-square-foot building was developed as a joint venture between WMC and LaSalle in 2018, with WMC taking the role of operating partner and developer with a less than 50 percent interest in the project. LaSalle engaged in the venture through its U.S. core open-end real estate fund, LaSalle Property Fund (LPF). 

In May 2018, the JV secured $35 million in construction financing from CIT Group for the property. 

The building was constructed on a 99-year ground lease, with the land owned by Redemptorist Fathers of New York church. 

In 2019, Memorial Sloan Kettering Cancer Center inked a 30-year lease at the property for 75,000 square feet, taking the entire six-story building. 

In good company, the asset is located a few blocks away from several Memorial Sloan Kettering outposts as well as the New York-Presbyterian/Weill Cornell Medical Center. It also neighbors Weill Cornell’s medical diagnostics imaging center.

In an announcement at the time of the property’s development, Richard Reese, a managing director of acquisitions at LaSalle, said: “This property fits well with LaSalle’s strategic focus on medical office acquisitions, offering long-term stability in a thriving location. The Upper East Side of Manhattan is a densely populated area with a robust pool of demand drivers. In addition, the medical facilities in the area are also able to boost demand well beyond the immediate neighborhood, creating the need for additional supply.”

Officials at WMC couldn’t be reached for comment. A LaSalle spokesperson and C&W officials declined to comment.

Cathy Cunningham can be reached at ccunningham@commercialobserver.com.