SL Green closes on $2.6B megadeal for Sapir’s 11 Madison

Acquisition is biggest single-building deal in NYC history

New York /
Aug.August 18, 2015 09:10 AM

SL Green Realty just closed on its $2.6 billion purchase of 11 Madison Avenue from the Sapir Organization and minority partner CIM Group. The deal, the largest single-building transaction in New York City history, is a huge coup for Sapir, which bought the property in 2003 for $675 million and managed to bring in marquee technology and media tenants.

The Sapir Organization, led by chief executive Rotem Rosen and president Alex Sapir, tripled the net operating income of the building to $120 million from $40 million, according to sources. The 2.3 million-square-foot Art Deco skyscraper, located between East 24th and 25th streets, has tenants such as Sony, which is taking 500,000 square feet at the top of the 30-story tower, and Yelp, which is taking over 150,000 square feet. Anchor tenant Credit Suisse also renewed its lease at the tower last year, but downsized to 1.2 million square feet to make room for Sony. Talent agency powerhouse William Morris Endeavor is taking about 70,000 square feet.

The $2.6 billion purchase price — which includes about $300 million in lease-stipulated improvements — is the second-highest ever paid for a New York City office tower after Boston Properties’ $2.8 billion purchase of the GM Building, at 767 Fifth Avenue in Midtown, in 2008. It is also the largest single-building transaction in the city’s history, as the GM Building deal was part of a $3.95 billion package that included three other towers.

In an earnings call last month, SL Green CEO Marc Holliday said he would look for ways to monetize the asset down the line.

“We tend not to hold on to assets in perpetuity,” he said at the time. “I would look at this asset as on a three-to-five-year period and then we’ll always readjust from there.” SL Green is partially funding the purchase through the sale of assets such as Tower 45 at at 120 West 45th Street and 131-137 Spring Street.

The 11 Madison deal was brokered by CBRE’s Darcy Stacom and Bill Shanahan.


Related Articles

arrow_forward_ios
From left: Rotem Rosen, Zina Sapir, Tamir Sapir, Bella Sapir, Elena Sapir, and Alex Sapir (Credit: Getty Images)
Alex Sapir accused of mismanaging family fortune amid feud with Rotem Rosen
Alex Sapir accused of mismanaging family fortune amid feud with Rotem Rosen
The Daily News Building at 220 East 42nd Street and SL Green CEO Marc Holliday (Credit: Getty Images)
SL Green puts Daily News building up for sale
SL Green puts Daily News building up for sale
SL Green snags private-equity firm at One Vanderbilt
SL Green snags private-equity firm at One Vanderbilt
SL Green snags private-equity firm at One Vanderbilt
 SL Green’s Marc Holliday with 450 Park Avenue  (Taconic Partners, SL Green)
TRD Pro: Here are NYC’s biggest offices sales of Q2
TRD Pro: Here are NYC’s biggest offices sales of Q2
Paycheck potential: A look at real estate’s top earners
Paycheck potential: A look at real estate’s top earners
Paycheck potential: A look at real estate’s top earners
JPMorgan Chase's Jamie Dimon with 79 Fifth Ave, Apollo Commercial Real Estate Finance's Stuart Rothstein with 165 East 66th Street, and Bank of China's Liu Liange with 555 West End Avenue (Google Maps, Hanley New York, 555westendave, Getty)
Summer slump: Manhattan’s 10 biggest loans shrivel
Summer slump: Manhattan’s 10 biggest loans shrivel
SL Green's Marc Holliday and 450 Park Avenue (Getty, Reading Tom, CC BY 2.0 via Wikimedia Commons)
SL Green reports $44M quarterly loss as it pivots to paying down debt
SL Green reports $44M quarterly loss as it pivots to paying down debt
Ben Ashkenazy goes on the offensive
Ben Ashkenazy goes on the offensive
Ben Ashkenazy goes on the offensive
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...