SL Green Forms Partnership for $2.3B One Madison Avenue Redevelopment in Manhattan

The redevelopment of One Madison Avenue in Manhattan will include adding 17 stories of glass and steel office space atop the bottom nine floors, which will also be renovated. (Rendering courtesy of SL Green Realty Corp.)

NEW YORK CITY — SL Green Realty Corp. (NYSE: SLG) has formed a joint venture partnership with the National Pension Service of Korea (NPS) and Hines for the $2.3 billion redevelopment of One Madison Avenue in Manhattan. The 1.4 million-square-foot office project is situated in the borough’s Midtown South neighborhood facing Madison Square Park near the 23rd Street subway station.

SL Green, which is self-described as Manhattan’s largest office landlord, has sold a 49.5 percent interest in One Madison Avenue to NPS and Hines, which have combined to invest “no less than $492.2 million” of equity into the redevelopment.

SL Green and Hines are co-developing the project, and Kohn Pedersen Fox Associates (KPF) is leading the design. The SL Green-NPS-Hines-KPF team is also working together to develop One Vanderbilt Avenue, an office project currently underway in Manhattan’s East Midtown neighborhood.

The existing office building at One Madison Avenue will be demolished down to the ninth floor, and the development group will build 17 glass and steel, column-free floors above. The podium levels at the base of the existing building will have 90,000 square foot floor plates, while the new floors above will feature 36,000-square-foot floor plates.

The 10th and 11th “garden floors” at the base of the new tower will offer more than 55,000 square feet of column-free space as well as 22-foot slab-to-slab heights. The garden floors will also feature nearly 30,000 square feet of panoramic terrace space. At full buildout, One Madison Avenue will have approximately 1.3 acres of accessible outdoor space for tenants.

Interior and exterior work to the existing podium levels includes renovating the lobby, modernizing material elements, enlarging existing windows and adding new retail space on the ground level, as well as activating below-grade spaces.

The project team plans to begin demolition in the third quarter, but no target delivery date was disclosed.

National Pension Service of Korea is one of the world’s largest pension funds. The firm manages about $628 billion in assets as of Jan. 31, 2020. Alternative assets (including global real estate investments) comprise about 11.6 percent of its total portfolio.

Hines is a privately owned global real estate investment, development and management firm with a presence in 205 cities across 24 countries. The company has $133.3 billion of assets under management. Hines has 165 developments currently underway around the world.

SL Green Realty Corp. is an office REIT based in Manhattan. As of the end of the first quarter, the firm held interests in 102 buildings totaling nearly 50 million square feet.

SL Green’s stock price closed on Monday, May 4 at $49.03 per share, down from $84.60 in early March before the onset of the COVID-19 outbreak in the United States.

— John Nelson

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