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Vornado has sold a Queens site to Chris Jiashu Xu, the developer behind the borough’s tallest tower, for a discount.
The Rego Park site, located at 93-30 93rd St., sold for $70M, below the $85M Vornado originally sought two years ago, The Real Deal reported.
Xu founded United Construction and Development Group and developed Long Island City’s 67-story Skyline Tower.
Vornado has been seeking to hoard cash by selling assets and suspending dividend payouts until next year, executives said in an earnings call earlier this month. The sales announcement is an about-face on its previous stance following the REIT’s slouching stock prices, according to The Real Deal.
But Vornado CEO Steven Roth batted away allegations that Vornado’s sales were the result of distress.
“We are not a weak seller,” Roth said on his company's earnings call earlier this month. “In fact, we are focusing on a very select pool of assets … where we consider ourselves to be offensive sellers.”
Xu has bought more in Queens in recent years, including a development site in Flushing for $103M last year and another Flushing site for more than $100M in 2016.
The Rego Park site, which has 670K SF of development rights, is next to a shopping mall, the Rego Center and the Alexander, a 312-unit luxury apartment building, both of which were developed by Vornado, per TRD.
Vornado originally hoped to offload the site to a developer in time for a purchaser to qualify for the 421-a tax break. It was unclear if Vornado received entitlements for the sale, which was arranged by JLL’s Bob Knakal and Stephen Palmese.
In the aftermath of the program’s expiration last summer, many multifamily developers pivoted to condos and projects outside of New York.
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