"This will give us an excuse to go out to dinner," Sitt tells GlobeSt.com. GVA Williams will provide property management and leasing services for the building, and Thor Equities will provide asset management services for the property
The joint venture purchased the 10-story office structure from SL Green Realty Corp. and Morgan Stanley Real Estate Fund III LP for $35 million, or approximately $172 per sf. SL Green originally purchased the property, which is between Eighth and Ninth avenues, in March 1998 for $17 million. In May 2000, SL Green contributed the property to the joint venture, retaining a 35% interest. SL Green then completed a redevelopment plan which included refurbishing and upgrading the lobby, storefront and building infrastructure.
The property is home to "Daddy's House," one of Sean Combs' recording studios as well as a cluster of other music industry-related ventures. There are two well-known retail ventures on the ground floor: Birdland, a jazz night club, and Club Babalu, a Latin dance club.
"The sale of 321 West 44th St. demonstrates our ability to create shareholder value by recycling capital through the sale of non-core properties," adds Marc Holliday, president of SL Green. "Our active redevelopment and repositioning of this asset enabled us to capitalize on strong investor interest in the Times Square submarket of Midtown Manhattan."
"The property offers an extraordinary opportunity for music-related studios and offices, as well as the many attorneys, publicists and other professionals who serve the theater industry," says Sitt. "We view this area of Manhattan as one of the great zones for the next wave of development, and are planning to spend $4.9 million to upgrade this property." Sitt felt the price paid was such a "great value" that he can afford upgrades to the infrastructure.
Cohen adds,"As an entertainment industry landmark, this Midtown building is one of the central venues for entities that service the industry."
The boyhood friends are also looking to pick up additional properties in the area Sitt calls a "new horizon" in Manhattan. Over the past 18 months, Thor Equities has acquired a retail, office and residential portfolio totaling approximately four million sf and valued at more than $350 million.
The expected closing for the sale is in December. CB Richard Ellis's William Shanahan, EVP, and Darcy Stacom, EVP, acted as the exclusive agents for the transaction.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
