SL Green Realty Corp. had a busy week. Together with its partners, it has entered into a contract to sell the fee ownership interest in 625 Madison Ave. for a gross sale price of $632.5 million, or $1,123 per square foot, to a global real estate investor. In connection with the sale, SL Green and its partners will originate a $234.5 million preferred equity investment in the property. Net proceeds from the sale will be used by the company for the repayment of corporate debt.
“This deal, and our recent capitalization of 245 Park, reaffirm that well-located office real estate in New York is still among the most sought-after asset classes in the world,” said Brett Herschenfeld, executive vice president, retail and opportunistic investments at SL Green. “Whether properties are upgraded to state-of-the-art office or are converted into a multitude of other uses that are in high demand, the appetite for Class-A office properties in prime Manhattan locations remains strong and growing.”
Located between 58th and 59th Street, 625 Madison Ave. is currently a 17-story, 563,000-square-foot office building with ground floor retail space. SL Green acquired its interest in the property through a previous mezzanine investment.
In addition, the company and Vornado Realty Trust signed a 15-year renewal and expansion lease with a financial services tenant covering 269,905 square feet on six floors at 280 Park Ave. The 1.25 million-square-foot midtown Manhattan office building is owned in joint venture between SL Green and Vornado, and recently underwent a $150 million full property redevelopment and modernization.
The tenant was represented by Mary Ann Tighe, Ken Meyerson, Brendan Herlihy, Eric Thomas and Marlee Teplitzky of CBRE together with Evan Margolin of JLL, while the joint venture was represented by Glen Weiss, executive vice president, office leasing and co-head of real estate at Vornado, and Steven Durels, SL Green’s executive vice president, director of leasing and real property, along with the CBRE team of Peter Turchin, Greg Rothkin and Jason Pollen.
In addition, Stonepeak Partners L.P., an international alternative investment firm, has signed a new 76,716-square-foot, 15-year lease covering the entire 31st and 32nd floors at SL Green’s 245 Park Ave. To date in 2023, SL Green has signed leases totaling 199,872 square feet in the building.
Stonepeak Partners, L.P. was represented by Silvio Petriello, Ben Friedland and Tamika Kramer of CBRE, and the landlord was represented by Patrick Murphy, Bruce Mosler, Tara Stacom, Harry Blair, Ron LoRusso, Justin Royce and Will Yeatman of Cushman & Wakefield.
