SL Green Nabs Ground Under 461 Fifth Avenue for $28M

The REIT has held the leasehold interest of the Midtown East building since 2003

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SL Green Realty Corp. bought the ground under 461 Fifth Avenue, giving it full control of the Midtown South property, public records show.

The developer bought the fee interest of the 28-story building for $28 million from Lane Owner LLC in a deal that closed on June 30, but was made public on Tuesday, according to property records.

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Representatives from SL Green and Lane Owner declined to comment.

SL Green bought the leasehold interest for the 200,000-square-foot 461 Fifth for $62.3 million in 2003 and has long had a contractual option to buy the land of the property. In April, SL Green exercised its option to pick up the fee interest, according to its first-quarter financial report.

Tenants in the building between East 40th and East 41st streets include U.S. Bank, Everest Reinsurance Company and Hewlett-Packard.

The ground lease space has had a surge of interest in recent months — thanks to the coronavirus pandemic pushing investors to find more stable, predictable cash flows — with the land under 909 Third Avenue selling for $192 million last month.

The deal is also a departure from SL Green’s recent strategy of selling off assets to buy back stock, with the landlord offloading its interest in 605 West 42nd Street and 400 East 57th Street in April.

Nicholas Rizzi can be reached at nrizzi@commercialobserver.com.