SL Green Sells Manhattan Tower for $815M

The blockbuster sale of 220 E. 42nd St. is one of the largest deals to close in New York City this year.
220 E. 42nd St.

SL Green, New York City’s largest landlord, has sold 220 E. 42nd St. in Manhattan for $815 million. The Commercial Observer identified the buyer as Jacob Chetrit, of the Chetrit Organization. The blockbuster deal, one of the largest in the city so far this year, is expected to officially close in the first quarter of 2020, the firm said in a release announcing the sale. Representatives for SL Green could not be immediately reached for comment.

The 37-story art deco office building, which formerly housed the headquarters of The New York Daily News, is located at the corner of 42nd Street and Second Avenue in Midtown. The deal comes on the heels of SL Green topping out its $3.1 billion supertall skyscraper One Vanderbilt two weeks ago nearby in Manhattan. The 1.6 million-square-foot office tower broke ground in 2016 and will rise 1,401 feet once completed in 2020, making it the fourth-tallest building in New York City.

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In 2003, SL Green bought 220 E. 42nd St. for $265 million from Witkoff, after its initial $53.5 million preferred equity investment in the fall of 2001. Following the purchase, the company spent several years repositioning and retenanting the office tower. The property is currently 97 percent occupied, with tenants including the Visiting Nurse Service of New York, Omnicom Group, local television network WPIX and the United Nations. According to The Real Deal, SL Green had been considering selling the tower since January of this year and put the building on the market over the summer.

SL Green’s Co-Chief Investment Officer, Isaac Zion, said in a statement that the sale is part of the firm’s strategy to sell assets in a healthy investment market and use the proceeds to buy back discounted stock of its shares “while maintaining a low leverage profile.”

Adam Spies and Doug Harmon of Cushman & Wakefield, along with Robert Verrone of Iron Hound Management arranged the deal.