As the city’s office market struggles to regain its footing amid a second pandemic winter, SL Green (SLG) Realty Corp. sold off a 25 percent stake last week in its massive office renovation and expansion project at One Madison Avenue in Manhattan.
The sale — to an unnamed international investor — allows SL Green to hold onto a 25.5 percent interest in the project. Its joint venture partners, National Pension Service of Korea and Hines, will keep a 49.5 percent stake in the development along Madison Square Park. The anonymous investor, meanwhile, committed at least $259.3 million in equity to the project.
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The redevelopment will turn an 1893 office building and its adjacent 1909 clocktower into a 26-story, 1.4 million-square-foot complex that occupies the full block on Madison Avenue between East 23rd and East 24th streets. Kohn Pedersen Fox is designing the building that will rise from the carved-out shell of the existing 19th-century structure. The limestone of the podium will be repaired and renovated with new windows.
KPF’s new glass tower will extend 16 stories after stepping back from the facade of the old 10-story building, creating a large, two-level outdoor space with landscaping and seating.
SL Green and Hines, which are co-developing the project, recently finished demolition and are wrapping up structural reinforcement of the old building. Work has inched along slowly during the pandemic, after SL Green nailed down a $1.25 billion loan for construction in the fall of 2020. Work — which will be largely completed by union construction crews — is expected to finish in the fall of 2023.
Besides the roof terraces, amenities will include a 13,000-square-foot restaurant, a 10,000-square-foot “artisanal dining market,” and a 7,000-square-foot tenant lounge with direct elevator access to a 10,000-square-foot roof deck. Chelsea Piers also recently signed on as one of the anchor tenants, taking 55,780 square feet for a fitness center across four floors in the base of the building.
