Green Realty has purchased 11 Madison Avenue in New York City for $2.6 billion. The largest single-building purchase in NYC history was acquired from the Sapir Organization and minority partner CIM Group.
According to The Real Deal, Sapir purchased the building in 2003 for $675 million and it quickly turned the location into a go-to lease for tech giants. Currently at the building are Sony and Yelp, among others.
The Sapir Organization tripled net operating income from $40 million to $120 million.
The Art Deco skyscraper includes 2.3 million square feet, of which Sony occupies 500,000 square feet at the top fo the 30-story tower. Yelp is also moving in and will occupy 150,000 square feet.
The building’s anchor tenant, Credit Suisse, also renewed its lease at the tower last year and downsized to 1.2 million square feet to make room for Sony.
William Morris Endeavor also occupies 70,000 square feet.
The purchase includes $300 million in lease-stipulated improvements. The only bigger deal was the $2.8 billion purchase of the GM Building, at 767 Fifth Ave. in Midtown, in 2008. However, that purchase included three other towers.
SL Green CEO Marc Holliday told investors during an earnings call that he would look for ways to monetize the asset down the line.
“We tend not to hold on to assets in perpetuity,” he told The Real Deal, “I would look at this asset as on a three-to-five-year period, and then we’ll always readjust from there.”
SL Green is partially fueling the purchase by selling assets such as Tower 45, at 120 West 45th St., and 131-137 Spring St.