Continuing a whirlwind acquisition spree, RXR Realty is buying 237 Park Avenue for around $800 million, Crain’s reported.
In partnership with Walton Street Capital, RXR scooped up the 21-story, 1.2 million-square-foot building, located between East 46th and East 47th streets, from Lehman Brothers Holdings, which had previously foreclosed on the troubled asset and recovered it from Broadway Partners. Scott Rechler, RXR’s chief executive, told Crain’s that he would invest several million dollars to renovate the building.
“It is consistent with what we’ve been looking for,” Rechler said. “It’s a good building with good bones that we can acquire at a large discount to what it would cost to replace the asset.”
The deal is part of a roster of other mammoth transactions that RXR has recently done in Midtown, including a long-term leasehold interest in 75 Rockefeller Center last month and an October acquisition of 450 Lexington Avenue from Dubai investment fund Istithmar World for $720 million.
Midtown is experiencing a glut of large blocks of office space as newer options on the far West Side become available and emerging fields, such as technology, favor smaller space requirements than older industries, such as finance. Still, Rechler told Crain’s that the continued economic upswing would breathe new life into the area. “We’re big believers in Manhattan and Midtown and as the economy gets legs and we see job growth we think it will translate into a lot of space absorption.” [Crain’s] –Hiten Samtani