Clarion, MHP Take to Manhattan’s Financial District
- Jan 09, 2015
Clarion Partners and joint venture partner MHP Real Estate Services (formerly Murray Hill Properties) have become the proud new owners of the 1.2 million-square-foot Manhattan office tower at 180 Maiden Lane, having shelled out approximately $470 million for the privilege.
The trade comes just more than three years after sellers, The Moinian Group and SL Green Realty Corp., became partners in ownership of 180 Maiden through a recapitalization; and roughly 10 years after Moinian snapped up the property for $355 million.
Million-square-foot office buildings in Manhattan don’t hit the market every day. As Margaret Egan, senior vice president in Clarion’s asset management group, told Commercial Property Executive. “The local investment sales environment is extremely competitive for core office assets as well as value-add product in strong submarkets with upside potential. For the 180 Maiden Lane purchase, we were able to draw on established industry relationships to successfully facilitate an off-market transaction.”
Developed in 1980 and renovated 15 years ago, 180 Maiden stands 41 stories tall in downtown’s Financial District. Currently, the LEED-certified building is occupancy-challenged, with an 800,000-square-foot vacancy, 730,000 square feet of which was left behind when AIG relocated last year. Clarion and MHP, however, are undaunted by the big hole in the tenant roster.
“Demand in the Downtown office market is extremely strong at present due to the tremendous infrastructure improvements that have been occurring, the increase in nearby housing and services, proximity to the labor pool in the outer boroughs and the cost-effective pricing of most office inventory compared to Midtown and Midtown South,” Egan said.
The new ownership also plans to lure tenants to 180 Maiden with upgraded amenities that will be achieved through an extensive $28 million capital improvement program scheduled to commence straightaway. Egan isn’t naming names, but divulges that office users are taking note.
“Our experience thus far relative to leasing activity at 180 Maiden Lane is extremely positive, with significant interest coming from throughout the Manhattan Market as well as New Jersey and across a wide array of industry sectors and for spaces of varied sizes,” she added.