The Real Deal New York

Citigroup will buy back Tribeca HQ from SL Green for $2B

REIT also announces deal with Nordstrom at 3 Columbus Circle

January 27, 2016 06:40PM
By Rey Mashayekhi

Citigroup CEO Michael Corbat, 388-390 Greenwich Street and Marc Holliday

From left: Citigroup CEO Michael Corbat, 388-390 Greenwich Street and Marc Holliday

Citigroup is exercising its option to purchase its Tribeca headquarters at 388-390 Greenwich Street from SL Green Realty for $2 billion, the real estate investment trust announced Wednesday.

The banking giant will buy back the 2.7 million-square-foot office complex it sold to a partnership between SL Green and Ivanhoe Cambridge for nearly $1.6 billion in 2007. The bank signed a $1 billion lease renewal for its 2.7 million square feet at the properties in 2013 – a deal that came with the $2 billion buyback option.

SL Green bought out Ivanhoe Cambridge for $783 million in 2014 to take full control of the property, which is undergoing a major renovation project featuring a curtain-walled makeover.

In conjunction with the its year-end earnings release for 2015, the city’s largest office landlord also announced a number of leasing transactions – most significantly a 23-year, 43,000-square-foot deal with Nordstrom to anchor three retail levels at 3 Columbus Circle, which SL Green owns in partnership with the Moinian Group.

The new store “will serve as an expansion” of the department store’s upcoming flagship location on West 57th Street, the landlords said, describing the deal as a “complex transaction” involving “a series of lease modifications and relocations.”

SL Green also announced that advertising and communications conglomerate Omnicom signed a 15-year lease renewal for 167,000 square feet at the 37-story, 1.2 million-square-foot News Building at 220 East 42nd Street, between Second and Third avenues. Omnicom’s space covers the building’s 11th through 15th floors.

In addition, the REIT said music content provider Music Choice had renewed its nearly 53,000-square-foot lease at the Olivia – a 36-story, 493,000-square-foot mixed-use building at 328 West 34th Street between Eighth and Ninth avenues.