An increasing number of nonprofits are taking advantage of the real estate market’s resurgence by cashing in on their property portfolio, Crain’s reported.
Last week, St. John’s University announced that it was putting its 10-story Tribeca business school building on the market, in a deal that experts say could net the university $200 million. The Jewish Board of Family and Children’s Services will also be selling a site on West 7th Street that would allow up to 100,000 square feet of residential development, sources told Crain’s, and could rake in up to $45 million. And in February, a joint venture between ClearRock Properties and Juster Properties acquired two adjacent Midtown buildings from Yeshiva University for $29 million.
“Being able to generate proceeds from this sale will definitely help us continue to deliver services,” David Rivel, chief administrative officer of JBFCS, told Crain’s.
The stakes also keep rising, according to data from Cushman & Wakefield, which showed that the average price of Class A office space nearly touched $800 per square foot last year, up from $740 the year before.
Nonprofits are aping their for-profit counterparts by learning how to more efficiently fit people into fewer space, and selling the surplus space to generate income. “You see nonprofits treating their real estate much more entrepreneurially,” Susan Kahaner, a nonprofit specialist at CBRE told Crain’s. “Since there’s not a nonprofit that isn’t using their office more efficiently right now, many of them are out there selling what they no longer need.” [Crain’s] –Hiten Samtani