SL Green Realty Corp. has closed on its previously announced acquisition of 10 East 53rd St., a 37-story, 390,000-sq.-ft. Midtown Manhattan office building. As part of the closing, the company has sold a 45 percent joint venture ownership stake in the building to Canada Pension Plan Investment Board (CPPIB), which has made an equity investment of $57.4 million before closing costs, adjustments and working capital.
The purchase price of the property was $252.5 million, or approximately $647 per sq. ft. New York Commercial Bank is providing the venture with a five-year, $125 million, floating rate mortgage.
“We believe that the prestige and value of quality properties in the Plaza District of Midtown Manhattan are unparalleled,” SL Green President Andrew Mathias, said in a statement. “The chance to add an additional plaza asset to our core portfolio does not come along often and upon being presented with this unique opportunity, we took it.”
Peter Ballon, vice president and head of Real Estate Investments – Americas with CPPIB, commented in a statement: “We are delighted to acquire a significant interest in a high-quality and extremely well-located property, which has the potential to be repositioned as a top boutique office property in Midtown Manhattan. This expands our real estate portfolio in New York City to interests in five prime office buildings in Manhattan.”
The class-A building was constructed in 1972 and is located in New York’s Plaza District between 5th and Madison Avenues, and is currently the headquarters of Harper Collins. The midrise and tower floors feature panoramic views of Central Park and the city’s skyline.
The property, with floor plates ranging between 8,400 and 16,300 rentable sq. ft., is currently 91 percent leased. Over the next three years, leases for approximately 60 percent of the property’s rentable square footage expire, providing the firm an opportunity to take advantage of what SL Green management believes are in-place rents that are substantially below market.