Shorenstein asking $500M for 850 Third Avenue

Developer looking to unload the 614K sf office tower for a hefty profit

TRD New York /
Apr.April 30, 2015 09:30 AM

Shorenstein Properties is gunning for a hefty profit with its planned sale of 850 Third Avenue. The 614,000-square-foot office tower, which JLL recently began marketing, has a price tag of $450 to $500 million, The Real Deal has learned.

When Shorenstein’s Fund Nine bought the 21-story building as part of a portfolio in 2008, it was valued at just north of $300 million. TRD first reported that the property was hitting the market in March, but the price tag wasn’t revealed at the time.

If the recent past is any indication, however, reaching this target could be a challenge. A sales price of $500 million would translate to $814 per square foot. Aby Rosen’s RFR Realty wanted $800 per square foot for An Office Building 757 Third Avenue, located three blocks south of 850 Third. According to reports, the Canadian real estate firm Bentall Kennedy has agreed to buy Rosen’s property for $360 million, or around $720 per square foot.

Representatives for Shorenstein declined to comment, while JLL couldn’t be reached by press time. With the $500 million ask for 850 Third, and a corresponding cap rate of just above 3 percent, Shorenstein is likely aiming at potential buyers such as pension funds or other institutional investors who are content receiving lower returns in the short term.

Tenats at the property, located between 51st and 52nd streets, include media firm Discovery Communications, the City of New York and Radio One. The property was once part of the Equity Office portfolio Harry Macklowe bought for $7 billion in 2007 and then famously defaulted on after the market crashed. The portfolio was a central theme in “Liar’s Ball,” Vanity Fair contributing editor Vicky Ward’s book on the GM Building.


Related Articles

arrow_forward_ios
Cammeby's International Group founder Rubin Schron and, from top: 194-05 67th Avenue, 189-15 73rd Avenue and 64-05 186th Lane (Credit: Google Maps)

Ruby Schron lands $500M refi for sprawling Queens apartment portfolio

Wendy Silverstein, co-head of WeWork’s real-estate fund, is out

WeWork’s side businesses are fizzling

Clockwise from left: 532-542 Union Street and 232 Third Avenue in Gowanus, Tavros' Colin Rankowitz and Avery Hall's Brian Ezra (Credit: Terra CRG, Tavros, Avery Hall)

Gowanus gold rush: Avery Hall, Tavros Holdings buy sites for $55M

A little good news for renters. We’re not talking to you LA and Manhattan

Michael Jordan and an aerial view of his Highland Park property (Credit: Getty Images)

Michael Jordan’s Chicago-area mansion has been on the market for 7 years. A buyer may not exist

Thor Equities evicted, Prologis buys another East Williamsburg warehouse: Daily digest

Unrealistic pricing bogs down Miami luxury condo market: TRD Showcase & Forum

arrow_forward_ios