111 Eighth Avenue hits the market for $2B

TRD New York /
Sep.September 10, 2010 12:00 AM

September 10, 2010 09:00AM

Almost two years to the day after Lehman Brothers crashed and burned, bringing commercial real estate deals to a near-standstill, the owners of the city’s fourth-largest office building have put the property up for sale for what appears close to a pre-crisis price: $2 billion. While that figure far eclipses any other deals in the post-Lehman world of New York City commercial real estate, if any property can bring in that kind of cash, analysts say 111 Eighth Avenue may well be the one. The nearly 3 million-square-foot building, which has unobstructed views and 15-foot ceilings, is chock full of desirable tenants like Google, Nike USA, barnesandnoble.com, Sprint and Armani Exchange. Next year, it is expected to generate a net operating income of almost $100 million. The current owners, a partnership of Taconic Investment Partners, the New York State Common Retirement Fund and German investment group Jamestown, are looking to sell at least a 90 percent stake in the building. They bought it, along with three other buildings, for $387 million in 1998. “There are very few investment options in today’s market, where interest rates are at historic lows, that provide yield, safety and secure growth,” said Douglas Harmon of Eastdil Secured, who is marketing 111 Eighth Avenue. “This property provides all three, plus it’s a franchise that acts as a hedge against inflation.” [NYT]


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