SL Green Realty has struck a deal with the 601W Companies for a property on Manhattan’s Far West Side at a price that would make it the largest office building to trade hands since the start of the pandemic.
The 601W Companies — headed by managing members Victor Gerstein, Michael Silberberg and Mark Krasick — reached an agreement to buy the Amazon-anchored property at 410 10th Avenue for $952.5 million, sources told The Real Deal. As part of the transaction, 601W will assume a $600 million construction loan on the property.
In a statement issued Wednesday morning, SL Green said it will retain a 5 percent interest in the property to complete its redevelopment.
“The sale of 410 Tenth Avenue is yet another indication of the Manhattan office market’s resiliency and continued global demand for high-quality, trophy assets with credit rated tenants,” SL Green managing director Brett Herschenfeld said in the statement.
A representative from 601W did not immediately respond to a request for comment. CBRE negotiated the deal on behalf of the seller.
The deal, first reported Tuesday by Real Estate Alert, would be the biggest transaction for an office building in Manhattan since the coronavirus pandemic virtually shut down the city in March. It’s one the real estate industry will watch closely as a barometer for the office market, which has been pummeled by the pandemic.
SL Green is selling the building with its partner, the Kaufman Organization. The REIT bought a stake in the property last year in a deal that valued the then-outdated office building at $440 million. Afterward, SL Green signed big leases, including Amazon’s 335,000-square-foot deal and one with First Republic Bank for 212,000 square feet.
The developer lined up a big construction loan led by Goldman Sachs and Wells Fargo to redevelop the building into a Class A property. It sits across the street from the Related Companies’ Hudson Yards megaproject, and a couple of blocks from Brookfield’s Manhattan West development.
The buyer is probably best known as the onetime owner of the Starrett-Lehigh Building in Chelsea, just a few blocks south of the new purchase. The company takes its name from the historic building’s address, 601 West 26th Street.