SL Green, Manhattan’s largest office landlord, has sold a 49 percent interest in 220 East 42nd Street to a real estate fund managed by Meritz Alternative Investment Management for $790.1 million.
SL Green retained a 51 percent interest in the property and will continue to oversee management and leasing of the building. The transaction generated net cash proceeds to SL Green of $136.1M.
“This transaction demonstrates the continued global demand for core New York City office properties, particularly those that are well leased on a long-term basis to credit tenants,” said Harrison Sitomer, Senior Vice President of SL Green. “With the new joint venture, 220 East 42nd Street will continue to provide SL Green shareholders with steady contractual cash flow. We are thrilled to be partnering again with Meritz on this historic asset.”
“We maintain a firm belief in the success of the New York City market. As such, this is our fourth transaction with SL Green and we look forward to continuing our partnership,” said Jun Hyun Shin, CEO of Meritz Alternative Investment Management.
Also known as the News Building, 220 East 42nd Street is a 37-story art-deco skyscraper that was originally the headquarters for The New York Daily News. SL Green purchased the property in February 2003. The company then commenced a multi-year repositioning and re-tenanting of the property.
Currently boasting occupancy of 93 percent with a weighted average lease term of over 15 years, the building’s tenant roster includes the Visiting Nurse Service of New York, Omnicom Group, local television station WPIX and the United Nations.
SL Green was advised by Adam Spies and Doug Harmon of Cushman and Wakefield, along with Marcella Fasulo, Josh King and Avery Silverstein.