Partial investments grow in Manhattan commercial real estate

From left: 3 Columbus Circle, 195 Broadway, 280 Park Avenue, 1166 Sixth Avenue

As investors flood the Manhattan commercial market and few buildings go up for sale, buyers are increasingly taking partial stakes in buildings. Crain’s cited RXR Realty’s purchase of 40 percent of 1166 Sixth Avenue, L&L Holdings finding an investor for part of 195 Broadway, SL Green Realty’s $138 million investment in 3 Columbus Circle and Vornado Realty Trust’s deal with SL Green for 280 Park Avenue. While the activity is a healthy sign for the market, it also requires multiple parties with millions of dollars at stake to work together on a single project. Often, these partial investors are sought by the building’s owners because bank loans are not possible considering the debt that already exists on the buildings. And with debt prices rising, some owners prefer to sell a stake rather than become handcuffed by looming obligations. [Crain’s]