DHL Building on 10th Avenue Up for Grabs for Roughly $250M
The sale offers a significant mark-to-market play for the building’s next owner.
By Cathy Cunningham March 4, 2024 4:30 pm
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The industrial building at 500 10th Avenue near Hudson Yards just hit the market, Commercial Observer has learned.
The sale of the property, which is currently net leased to DHL Express through 2026, is expected to, ahem, deliver around $250 million to its current owners, sources familiar with the asset said.
The 250,000-square-foot, seven-story building spans a full block front between West 38th and West 39th Streets near Hudson Yards. It’s currently owned by Mitchell Rutter’s Essex Capital and developer Jacob Frydman.
DHL signed its 20-year lease, which includes two five-year extension options, in 2006. With the logistics and shipping company’s rent significantly below today’s market value, the transaction represents a significant mark-to-market opportunity for its eventual new owner, sources said.
Newmark’s Adam Doneger, Adam Spies, Doug Harmon, Josh King, Marcella Fasulo and Willis Robbins are marketing the sale of the property, sources said.
The 1930-era building represents one of the few true industrial properties in Manhattan today. Sitting at the mouth of the Lincoln Tunnel and just two blocks from the West Side Highway, it offers prime accessibility as a last-mile logistics location. But its bones also have the potential to be repositioned for myriad other uses, such as a data center or electric vehicle fleet parking.
According to Essex Capital’s website, the firm saw 500 10th Avenue’s potential when it took the reins in 2009. The firm got to work clearing the building to make way for DHL, investing $40 million into the property via new office space and elevators as well as upgraded freight elevators.
The offering memorandum is now in the hands of potential suitors, sources who received it confirmed, and although there’s no bid date listed, offers are expected to roll in within the next few weeks.
Officials at Essex Capital didn’t immediately return requests for comment and Frydman couldn’t be reached. The Newmark brokers declined to comment.
Cathy Cunningham can be reached at ccunningham@commercialobserver.com
