JV Buys SL Green Property for $160M

NEW YORK CITY-Locally based SL Green Realty Corp. entered in an agreement to sell 440 Ninth Ave. here to a joint venture between locally based duo Paramount Group Inc. and Sherwood Equities Inc. for $160 million. The sale price on the 339,000-sf office building was approximately $472 per sf.

The 18-story property is situated on Ninth Avenue between 34th and 35th streets. Since acquiring the property in 1998 for $31.7 million, shortly after SL Green’s initial public offering, the company invested approximately $24 million of additional capital in a targeted repositioning plan that, according to a statement, helped attract and retain the property’s three largest tenants: B&H Photo, Duane Reade and eEmerge. The property is currently 100% occupied to other tenants including Kopff, Nardelli & Doff, EngenderHealth and Uncle Jack’s Steakhouse.

For SL Green, the sale of 440 Ninth Ave. will generate a gain of approximately $111 million with a capitalization rate of 4.6%. The proceeds of this sale will be reinvested tax free as part of a 1031 exchange.