The Real Deal New York

LCOR eyes $400M sellout for condo conversion of 25 Broad

Pricing would range from $800 to $2,000 psf
By Rich Bockmann | April 24, 2018 12:35PM

25 Broad Street

LCOR is planning a nearly $400 million sellout for its condominium conversion of the 308-unit rental building at 25 Broad Street in the Financial District.

The development firm, which is majority owned by the California State Teachers Retirement System, filed an offering plan with the New York state Attorney General’s office indicating a $395 million projected sellout for the project.

David Sigman

LCOR principal David Sigman told The Real Deal that pricing is forecasted to range from about $800 per square foot at the base of the building to $2,000 per square foot for the top floors.

“We’re really just trying to decide if this is the best route to go,” he said. “We’ll start reaching out to see what kind of interest there is from current tenants and see where the condo market goes over time.”

LCOR filed a “test the market” application with the AG’s office in November to gauge interest for a potential offering. The average condo price in Manhattan during the first quarter was $2.68 million, according to Douglas Elliman. That checked in at $1,989 per square foot.

The developer bought the 21-story building at a foreclosure auction in 2012 from Kent Swig, who had previously worked on converting the former office building to condominiums before defaulting on his mortgage with Lehman Brothers in 2009.

LCOR, which at the time was majority owed by Lehman, brought the rentals online and leased most of them by 2011. Lehman sold its 90 percent stake in LCOR to Calstrs in 2012 for $820 million in a deal that included 25 Broad Street.

Court records show that the original condo-offering plan had been abandoned.

The 518,000-square-foot 25 Broad received the 421g tax exemption, which gives an incentive to property owners to convert buildings to residential use in Lower Manhattan. A Manhattan State Supreme Court judge ruled in 2015 that two tenants had not been properly notified about the exemption’s termination, which entitled the tenants to a rent-stabilized apartment in perpetuity.