RXR Set to Buy 590 Madison Avenue for Nearly $1.1B

Eastdil Secured’s Will Silverman, Gary Phillips and Roy March are brokering the deal. Spokespeople for RXR, STRS Ohio and Eastdil did not immediately respond to requests for comment.

The pending deal comes after the 1 million-square-foot building on the corner of Madison Avenue and East 56th Street hit the market at roughly $1.1 billion in February, one of the largest price tags for an office property since the pandemic, as Commercial Observer previously reported.

Some of the city’s largest landlords — including RXR, Tishman Speyer, Blackstone, SL Green Realty and RFR Holding — were involved in the bidding process, with Blackstone emerging in April as the favorite to win the property, TRD reported.

But the large price tag gave some of the bidders pause, with sources telling CO earlier this month that the deal could be structured as an installment sale.

Now, after offering to buy the entire building outright, RXR will take over the landmarked office property — long known as the IBM Building — in one of the first major trophy office asset sales in New York City this year.

It’s also one of the biggest price tags in recent years, marking the highest billion-dollar investment sale in the city since Google paid $2.1 billion for 550 Washington Street in 2022, as CO previously reported.

Current tenants of the office tower include luxury retail giant LVMH, financial services firm E.F. Hutton and private equity firms Crestview Partners and Apollo Global Management, the latter of which finalized its lease for 100,000 square feet at the building in April.

And 590 Madison isn’t RXR’s first big Manhattan office deal this year.

In January, the company took a 49 percent stake in Ivanhoe Cambridge’s 45-story office tower at 1211 Avenue of the Americas and secured a three-year extension for the property’s $1 billion commercial mortgage-backed securities (CMBS) loan earlier this month, CO reported.

Isabelle Durso can be reached at idurso@commercialobserver.com.