At the time, Norman Sturner, MHP co-founder and principal, told GlobeSt.com that "we pre-empted the whole world. It is what we consider a coup." Sturner went on to explain that "the teaser had been sent out" on 1250 Broadway, and first bids were to be submitted on Feb. 12. "But there were no bids. We bought it this morning [Friday, Feb. 8]."
[IMGCAP(2)]SL Green declined to discuss its disposition strategy regarding this deal when contacted by GlobeSt.com; however, company officials did note that they are pleased with the outcome. Located near Penn Station on Broadway at 31st Street, 1250 Broadway is a 670,000-sf office tower which sale caps a successful nine-year period of ownership and management by SL Green, during which time the property's value more than tripled, according to an SL Green statement. The company acquired the building in 1999 for $93 million, and then sold a 45% interest to SITQ in 2001 in a transaction that valued the property at $126.5 million. After executing more than 630,000 sf of leases and completing a $6.8-million building renovation program, the partners recapitalized the property in October 2006, with an agreed-upon value of $260 million--at which time SL Green's economic stake increased from 54.9% to 66.2%.
SL Green expects to recognize an incentive fee of at least $15 million upon consummation of the sale, the statement notes. Marc Holliday, CEO of SL Green says in a prepared statement that "we are very pleased with the outcome of our investment in 1250 Broadway. Our track record there illustrates SL Green's unsurpassed strengths in recognizing latent value in a property and bringing it to full realization. In addition, our working partnership with SITQ has never been stronger. Together we have created substantial value--not only at 1250 Broadway, but also at One Park Ave. and 1515 Broadway. We believe that our most recent joint investment, the $1.6-billion acquisition of 388 and 390 Greenwich St., will prove successful as well."
Cushman & Wakefield acted on behalf of the seller. Richard Baxter, who handled the marketing of the sale, along with Ron Cohen, Scott Latham and Jon Caplan of C&W, told GlobeSt.com in January that the property was 99% occupied; however, 30% of the building is rolling over within the next five years, he added. He further explained that he expected many buyers to show interest. Market rents are about $60 per sf in the area; however, the asking rents in the building are in the mid-$30s, he said.
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Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com and GlobeSt. Real Estate Forum, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
