Investor group closes on 701 Seventh Avenue, considers hotel for site

October 17, 2012 12:00PM

A venture between Steven Witkoff and Michael Ashner has purchased 701 Seventh Avenue in Times Square, Bloomberg Businessweek reported. Howard Michaels, chairman of the Carlton Group, who represented Witkoff in the acquisition, said the value of the transaction is approximately $2 billion, in a statement provided to The Real Deal.

The venture, which also includes Miami-based investment partner the Vector Group, aims to replace the two existing buildings, totaling 120,000 square feet, with “85,000 square feet of prime retail space and 24,000 square feet of LED signage,” according to Michaels’ release. The partnership is being led by a Vector-owned entity named New Valley LLC — Vector’s CEO, Howard Lorber, told Businessweek that the investors are considering redevelopment, which might include a 30-story hotel.

“The site is as-of-right for a 500-key hotel and some of the top hotel companies in the world are at Mr. Witkoff’s doorstep vying for him to build a completed hotel in arguably the number one tourist destination in the world,” said Michaels.

Barry Sternlicht’s Starwood Capital Group provided the venture with a $475 million senior loan. [Businessweek] — Zachary Kussin