SL Green Acquires HarperCollins Building for $253M
By Jacqueline Hlavenka
NEW YORK CITY-SL Green Realty Corp., the city’s largest publicly-traded office REIT, kicked off the new year with its first major buy: the HarperCollins Building in Manhattan’s Plaza District. The property, located at 10 E. 53rd St., traded for $252.5 million, or approximately $647 per square foot.
The transaction follows a year of big deals for the REIT, which included acquisitions like 180 Maiden Lane, a consolidation of ownership at 1515 Broadway and a refinancing at 3 Columbus Circle. Under its latest deal, SL Green is planning a capital improvement program for the 37-story, 390,000-square-foot building, which is 91% occupied.
The REIT has entered into a joint venture agreement with an institutional partner to complete the renovations, and will hold a 55% stake in the venture and act as general partner. A spokesman for SL Green declined to disclose the partner to GlobeSt.com.
Over a three-year period, leases for 60% of the property’s rentable square footage expire, which will provide the REIT to take advantage of below-market rents, the company says. After the improvements are complete, SL Green will launch a new marketing and leasing campaign to bring the building back to market.
Andrew Mathias, president of SL Green, says he hopes to capitalize on the building’s strong location and existing infrastructure. “This Midtown office tower will become a highly coveted business address in the Plaza submarket – especially for boutique tenants seeking full floor identity with stunning Central Park views,” he says, in a prepared statement.
The seller, Milan-based Cariplo Pension Fund, advised by Hines, said the sale permitted the company to “achieve significant results” in a “transparent and fast” process. The deal involved the collaboration of Hines’ Italian fund management arm, Hines Italia SGR, as well as Hines’ New York team. Tommy Craig, senior vice president in charge of the Hines New York office, described the deal as a “successful cross-border collaboration,” in a statement.
The seller was also represented by brokers Darcy Stacom and William Shanahan of CBRE. Spokespersons for Hines and CBRE all declined to comment beyond a news release to GlobeSt.com for this story.