SL Green Agrees to Sell Amazon-Anchored Office Building Under Redevelopment in Manhattan for $952.5M
NEW YORK CITY — SL Green Realty Corp. (NYSE: SLG) and its joint venture partners have entered into a contract to sell 410 Tenth Avenue, a 20-story, 636,000-square-foot office tower near Hudson Yards on Manhattan’s west side, for $952.5 million. The transaction marks the largest commercial property sale in the U.S. since March, according to SL Green.
Amazon and First Republic Bank anchor the property, which is currently undergoing a redevelopment. Amazon signed its 335,408-square-foot lease in December. The buyer was undisclosed.
SL Green is the majority owner of the building, with a 70.9 percent stake. As part of the sale, the sellers will retain a 5 percent interest through completion of the redevelopment, which is slated for the third quarter of 2021. The identities of the minority owners were not disclosed.
The transaction is expected to close during the fourth quarter. Brett Herschenfeld, managing director of SL Green, says that the sale is an example of acquiring an undervalued asset, redeveloping it to Class A standards and re-leasing it to high-quality tenants.
“While the asset was always intended to be held as a long-term investment, the sale will allow the company to achieve extraordinary profits, substantially reduce consolidated indebtedness and generate additional liquidity for share repurchases,” says Herschenfeld.
The property was once known as the Master Printers Building and its redesign honors that industrial heritage, according to SL Green. As part of the redevelopment, the lobby is being relocated with new windows, elevators, storefronts and façade recoloring. Tenants will have access to a new 5,000-square-foot roof deck and a 3,000-square-foot lounge.
SL Green received a $600 million refinancing in September for the redevelopment project.
Darcy Stacom of CBRE represented SL Green in the transaction.
SL Green is a real estate investment trust that is focused primarily on acquiring, managing and maximizing value of Manhattan commercial properties. As of Sept. 30, the company held interests in 93 buildings totaling 40.6 million square feet. Its stock price closed at $47.92 per share on Tuesday, Nov. 3, down from $85.70 per share one year ago.
— Kristin Hiller