Amazon-Anchored NYC Office Project Sells For $953M In Country’s Largest Post-Pandemic Deal
A big deal is brewing in Hudson Yards.
SL Green is under contract to sell its 636K SF, 20-story Class-A office redevelopment project at 410 10th Ave. for $952.5M, it announced in a press release Wednesday. The real estate investment trust says it is the largest single-asset real estate transaction in the country since the pandemic took hold.
The 601W Cos. is the buyer, The Real Deal reported a few hours after SL Green announced the deal. The private commercial real estate investment company will also pick up the $600M construction loan that SL Green took on for the redevelopment, according to TRD.
“While the asset was always intended to be held as a long-term investment, the sale will allow the company to achieve extraordinary profits, substantially reduce consolidated indebtedness and generate additional liquidity for share repurchases,” SL Green Managing Director Brett Herschenfeld said in a statement.
The real estate investment trust will retain 5% of its interest in the property until redevelopment is complete, it stated. It currently holds a 70.9% interest in the project. Kaufman Organization has held the remaining minority interest in the property since it sold SL Green a majority stake for $440M in 2018.
Since SL Green took control of the property, it launched the redevelopment project and signed Amazon and First Republic Bank to anchor leases of more than 500K SF combined.
“The sale of 410 Tenth Avenue is yet another indication of the Manhattan office market’s resiliency and continued global demand for high-quality, trophy assets with credit rated tenants,” Herschenfeld said in the release.
SL Green refinanced its debt on the building in September. The $600M construction loan financed by a group of banks including Goldman Sachs and Wells Fargo replaced a $465M construction loan. CBRE’s Darcy Stacom brokered the sale for SL Green.
The deal comes amid a period of uncertainty in the Manhattan office market — availability is at a 16-year high and sublet space on the market is set to surpass its peak during the Great Financial Crisis. SL Green reported that it turned a profit of $13.9M during Q3 of this year, down from $33.2M last year.