Vornado Realty Trust and partner Crown Acquisitions put up $700 million to purchase the retail condo at the St. Regis Hotel in the heart of the city’s most coveted retail corridor.
The two companies teamed up to purchase the condo and an adjacent retail townhouse with 100 feet of frontage along Fifth Avenue at the corner of 55th Street, the REIT announced Wednesday.
Swiss luxury retailer Richemont had purchased the the space for $312 million in 2012 from a partnership that included Crown Acquisitions, the Feil Organization and Goldman Properties.
The properties have two tenants: Gucci, which is leasing 17,100 square feet for its Bottega Veneta brand through the beginning of 2016, and LVMH which has a 7,600-square-foot lease running through January 2019.
Vornado will have an ownership stake of between 67 percent and 80 percent depending on Crown’s option to invest additional capital, the REIT said in a statement. The deal is expected to close early in the fourth quarter.
The stretch of Fifth Avenue between 49th and 59th Streets commands the highest retail rents in the city.
During the first quarter of the year, average rents hit a record-high of $3,550 per-square foot, according to the Real Estate Board of New York’s spring retail report. That figure was up 16 percent from the same time last year.
Vornado also owns 689 Fifth Avenue on the southern end of the block.