NEW YORK CITY—SL Green Realty Corp. has sold its interest in the commercial condominium at 315 W. 36th St. at an asset valuation of $115 million, or $779 per square foot. Woody Heller of Savills Studley advised the REIT on this transaction. SL Green, the city's largest commercial property owner, acquired its interest in the property in late 2012 at a gross asset valuation of $45 million.
The company's nearly 36% share of the property was purchased by Walter & Samuels chairman David Berley. He first purchased the Garment District building, situated one block from Hudson Yards between Eighth and Ninth Avenues, 40 years ago and remains its main investor.
“We are delighted to buy SL Green's stake in the property,” says Berley. “We have a long-term hold strategy for this building, and believe the asset will perform well over time.”
The 17-story building features 14 loft condominiums across the upper seven floors and 132,945 square feet of office space across the lower nine floors. The entire commercial portion of the building was leased earlier this year to shared workplace provider WeWork.
“The strategic early termination of the Teach for America lease laid the groundwork to unlock substantial value in the building,” explains SL Green managing director Brett Herschenfeld. “Signing a new long-term lease with WeWork allowed for the culmination of that strategy to take place through the sale of our interest, which provides returns and proceeds well in excess of our underwriting.”
He continues, “This sale is a continuation of our business plan as it provides proceeds that can be redeployed into Eleven Madison in a tax efficient manner.”
Adds Berley, “SL Green considerably increased the property's value when it secured a lease with WeWork. We anticipate further growth in the coming years as the areas between Midtown and Hudson Yards continue to develop.”
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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.
