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New York REIT pays $335M for Twitter HQ building

 New York REIT, Inc., a publicly traded real estate investment trust  has entered into a purchase and sale agreement to acquire Twitter’s headquarters in Manhattan located at 245-249 West 17th Street in the Chelsea for $335 million.

The seller, Savanna, was represented by Adam Spies and Doug Harmon of Eastdil Secured.

245-249 West 17th Street
245-249 West 17th Street

Savanna bought the 282,000 s/f two-building property in 2012 for nearly $76 million.  They spent another $29 million upgrading the combined 12-story office tower and an adjacent six-story mixed use building.

Savanna scored a 140,000 s/f lease with Twitter earlier this year after the micro-blog site lost out on a bid to secure space at 51 Astor Place. In addition to Twitter, Room & Board, Inc. occupies the retail portion of the building. Flywheel Sports, Inc. is also a tenant.

The leasing effort was led by David Falk, Peter Shimkin, Danny Levine and Nick Berger of Newmark Grubb Knight Frank on the office side and Jeffrey Roseman and Amy Zhen of Newmark on the retail side.

Built in 1902 as the original warehouse and wagon house for the Siegel Cooper department store, 249 West 17th Street has  14-17 foot ceiling heights, 35-foot column spans and 9-foot windows.

245 West 17th Street was built in 1909 and its first six floors share pass-through connections to 249 West 17th Street, making it an attractive 36,000 s/f combined plate

Savanna created  new lobbies and security systems, water-cooled HVAC systems, new elevators, high-end core bathrooms, and a restored façade and roofThe work earned LEED Gold Certification and transformed two 100 year-old buildings into Class A, loft-style office space targeted toward the types of tenants that are currently driving rents in the Midtown South submarket.

“We are very proud of our redevelopment and leasing efforts at 245 & 249 West 17th Street,” said

CHRISTOPHER SCHLANK
CHRISTOPHER SCHLANK

, managing partner of Savanna. “After acquiring two aging, vacant buildings, Savanna worked hard to deliver a Class A, fully occupied product to the market. We believe that NYRT is acquiring two outstanding properties in an area where rents continue to grow substantially.”

Midtown South remains the tightest office submarket in the country and continues to attract tenants from the new media, fashion and tech industries that are seeking space which maintains the loft-like aesthetic of an aging building within a modern infrastructure. Savanna’s efforts to significantly upgrade the 17th  Street properties while preserving the original hardwood floors, exposed ceilings, and open, loft-like architecture resulted in a space that fits the profile of these firms.

“We are thrilled to have reached agreement to acquire the headquarters of Twitter.  This flagship property located in one of Manhattan’s most desirable sub-markets, has been fully renovated and is distinguished by two new lobbies, brand new state-of-the-art building systems, windows, elevators and a stunning rooftop terrace that overlooks the Hudson River,” said Michael A. Happel, President of NYRT.

 Happel continued, “In addition, the fact that Twitter, one of the world’s most prestigious technology firms, chose this property as its New York headquarters demonstrates the importance of this location and further testifies to the institutional quality of the property itself. We are confident that these buildings, located in New York City’s epicenter of creativity, technology and style, will add significant value to our growing, first-class Manhattan property portfolio.

“The seller, Savanna, did a wonderful job redeveloping this property and attracting long-term leases with high quality tenants.  They saw an opportunity to redevelop this property and they executed.  NYRT is pleased to be the direct beneficiary of these efforts.”

 

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