iStar Affiliate Closes $535M in Ground Leases

The REIT finalized a previously announced joint venture agreement for a ground lease of 425 Park Ave. in Manhattan and the additional ground lease of a Honolulu hotel.
425 Park Ave. Image via Wikimedia Commons

Safehold Inc., a subsidiary REIT of iStar, announced the finalization of a joint venture ground lease purchase of 425 Park Ave. in Manhattan for $340 million, as well as the separate ground lease purchase of Alohilani Resort in Hawaii for $195 million.

In an agreement first announced last month, Safehold will purchase the ground lease of 425 Park Ave., a Manhattan office tower currently under construction, along with a joint venture partner, an unnamed sovereign wealth fund. Safehold’s 55 percent stake in the property will total $340 million, according to the company. The 47-story office building, which topped out in December 2018, is being developed by L&L Holding Co. and GreenOak Real Estate. Global asset management firm Citadel has already pre-leased a big chunk of the office space at the property, which is expected to open early next year.

Meanwhile, the company also announced the finalization of a joint venture acquisition of the Alohilani Resort Waikiki Beach in Honolulu, Hawaii, for $195 million. The purchase is Safehold’s first investment in the state. The 839-key hotel opened after a $115 million rebranding and redevelopment last year and is located one block from the waterfront in Waikiki Beach. Guest amenities include an infinity pool, a 280,000-gallon oceanarium and two on-site restaurants by “Iron Chef” Masaharu Morimoto.

A representative of Safehold did not respond to a request for more information on the deals.