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ARC NYRR Pays $220.3M for Midtown Office

SL Green Sells 348,000-SF Investment Fully Leased to Four Tenants
August 12, 2013
American Realty Capital New York Recovery REIT, Inc. has acquired the office building at 333 W. 34th St. in New York City from SL Green Realty Corp. for $220.3 million, or about $632 per square foot, exclusive of closing costs.

The ten-story, 348,363-square-foot office tower was built in 1953 on three-quarters of an acre in Midtown Manhattan's Penn Plaza / Garment District submarket, between Eighth and Ninth Avenues. The asset is fully leased to four tenants: The Segal Company, Inc., The Metropolitan Transportation Authority, Godiva Chocolatier, Inc., and Sam Ash New York Megastores LLC.

Michael A. Happel, chief investment officer of NYRR, explained, "The purchase of 333 West 34th Street exemplifies our commitment to buying well-located, well-tenanted, stabilized assets in New York City with potential for asset appreciation and limited downside risk. This building is situated between the burgeoning Hudson Yards and Herald Square sub-markets of Midtown Manhattan, and features top-quality tenants at below market rents."

In June 2007 SL Green acquired the asset, then owned and occupied by Citigroup, in a sale-leaseback deal for $183 million, or $525 per square foot, according to CoStar data (CoStar COMPS #1321343). The developer then completed a $26 million renovation at the property in 2010.

NYRR is a publicly-registered, non-traded real estate investment trust. Its portfolio now totals approximately $775 million.

The Jones Lang LaSalle capital markets team of Richard Baxter, Yoron Cohen, Jonathan Caplan, Scott Latham, Glenn Tolchin, Jason Gold and Anthony Ledesma represented the sellers.

Please see CoStar COMPS #2812823 for additional information on this transaction.
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