NEW YORK CITY-Continuing its move into sectors beyond office, SL Green Realty Corp. Wednesday announced it has reached agreement to buy 315 W. 33rd St, which is known as the Olivia, for $386 million. The sale of the mixed-use residential and commercial building—which was owned by Stonehenge Properties—included an adjacent lot.
The deal was brokered exclusively by CBRE's vice chairmen Darcy Stacom and Bill Shanahan, along with Paul Leibowitz, EVP. In addition, FTI Consulting acted as an advisor to the transaction.
The 36-story, 492,987-square-foot building includes 333 luxury rental apartments and was completed in 2012. The commercial space, which is 100% leased at below-market rental rates, consists of 270,000 square feet primarily situated along 34th street and includes a 14-screen movie theater, five ground-level retail stores, two office suites and a 250-space parking garage.
SL Green bought the property to add to its residential portfolio while the timing was right, says president Andrew Mathias. “We see this acquisition as a great opportunity to expand our multifamily investment platform at a time when the New York City residential market is strong.” The purchase follows the company's acquisition last year of a new, vacant residential building in Williamsburg, which sits above a commercial condo it bought in 2010. The price of that deal was not disclosed.
The company started playing outside of the office sector in early 2011 when it entered into a joint venture with Israel-based Harel Insurance and Finance Group and locally based Naftali Group to build student housing for Pace University in Lower Manhattan. That move was followed up last August with the announcement of a second planned dormitory for Pace, through the same JV.
Located between 8th and 9th avenues, the Olivia likely will benefit from planned improvements to the area around west 34th St., says Mathias. “The property is strategically situated on the 34th Street retail corridor, which continues its westward expansion. The anticipated substantial increase in pedestrian traffic between Penn Station and Hudson Yards is likely to strengthen that retail corridor, which we believe will significantly enhance the value of this property's retail component.”
Economic trends also will help increase the asset's value, Mathias continues. “The property is in a neighborhood that is expected to absorb thousands of new jobs during the next decade. With those new jobs, the local demand for luxury housing is expected to climb sharply.”
SL Green declined further comment. Stonehenge Properties and CBRE did not respond to requests for comment at press time.
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Rayna Katz
Rayna Katz is a seasoned business journalist whose extensive experience includes coverage of the lodging sector, travel and the culinary space. She was most recently content director for a business-to-business publisher, overseeing four publications. While at Meeting News, a travel trade publication, she received a Best Reporting award for a story on meeting cancellations in New Orleans during Hurricane Katrina.
