SL Green Acquires Manhattan Office Building for $252 Million

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SL Green Realty announced today they have entered into an agreement to acquire 10 East 53rd St., a 37-story, 390,000-square-foot Midtown Manhattan office building.   The purchase price is $252.5 million, or approximately $647 per square foot.

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 square feet, is currently 91 percent leased.  Over the next three years, leases for approximately 60 percent of the property's rentable square footage expire, providing SL Green the opportunity to take advantage of what SL Green management believes are in-place rents that are substantially below market.

SL Green intends to implement a significant capital improvement program along with a targeted leasing and marketing campaign to reposition and reintroduce the building in the marketplace.  The Company has entered into a joint venture agreement with an institutional partner, and will hold a 55% stake in the venture and act as general partner.

Andrew Mathias, President of SL Green, commented, "The Plaza District is home to a number of Midtown's premier trophy assets, and because of the prestige and value of these assets it is rare that an opportunity to acquire one arises.  When presented with the chance to add one of these assets to our core Midtown portfolio, we seized it."

Mr. Mathias continued, "Having recently achieved notable repositioning and leasing successes at 100 Church Street and 3 Columbus Circle, we believe that when we apply our market-leading management capabilities to 10 East 53rd Street, 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."

The seller was represented by Hines Interests, as asset manager, and by brokers Darcy Stacom and William Shanahan of CBRE.

SL Green Realty is New York City's largest commercial office landlord.