Joe Sitt’s Thor wants $370M for Madison Ave retail condo

Full-block property was one of the priciest ever when Joe Sitt bought it for $277M in 2013

New York /
May.May 15, 2019 08:00 AM
680 Madison Avenue and Thor Equities CEO Joe Sitt (Credit: Google Maps)

680 Madison Avenue and Thor Equities CEO Joe Sitt (Credit: Google Maps)

Joe Sitt, the face of Manhattan’s high-wire retail scene, is looking to sell one of the city’s priciest shopping destinations.

Sitt’s Thor Equities is putting the block-long retail condo at the base of the Carlton House on Madison Avenue’s Gold Coast up for sale, sources told The Real Deal. The asking price is $370 million, or close to $11,000 per square foot.

If the property trades at that price, it would put it in the highest echelon of Manhattan retail deals. The condo at 680 Madison Avenue was already one of city’s priciest when Thor paid $277 million, or just over $8,000 a foot, for it six years ago. The following year, Vornado Realty Trust and Crown Acquisitions paid $700 million for the retail at the St. Regis Hotel, but few deals trade at such a number.

A spokesperson for Thor confirmed the property is for sale, but declined to comment further. A JLL team led by Mo Beler is marketing the condo. Beler couldn’t be reached for comment.

The space, which has 367 feet of frontage that wraps around Madison Avenue to East 61st and 62nd streets, boasts a current occupancy of 95 percent. But things started out a bit bumpier.

Thor bought the retail condo in 2013 from Extell Development, which converted the upper floors to co-op apartments with Angelo, Gordon & Co. Thor went to work leasing the property and early on signed a deal with Qatari fashion brand Qela in 2014 at $2,000 per square foot, one of the priciest rent deals ever struck on Madison Avenue. (Asking rents on Madison’s Gold Coast – from East 57th to East 72nd streets – have since fallen to an average of $1,025 per square foot during the first quarter of the year, according to CBRE.)

But Qela never moved into the store and by September of the following year had stopped paying rent. Thor terminated the lease in December and started drawing down of the tenant’s $12 million letter of credit to cover the rent deficit.

At the time, the property was running at a net loss and didn’t have enough cash to cover its debt service. Thor, however, was able to turn things around and eventually leased the space to luxury menswear designer Tom Ford. Other tenants at the property now include the eyewear shop Morgenthal Frederics, Italian suit maker Brioni, British fashion house Ralph & Russo and shoe designer Sergio Rossi.

Thor refinanced the condo in 2017 with a $310 million loan package from JPMorgan and another, unidentified lender. The loan had a two-year term, meaning it comes due this year.

The condo sits toward the southern end of Madison’s Gold Coast, which has fared relatively well in recent months amid retail’s broader struggles.

French handbags and accessories store Celine earlier this year opened a store one block south of Thor’s property at 650 Madison Avenue. And luxury fashion house Balenciaga – reportedly motivated by Celine’s move – recently signed a lease at 610-620 Madison Avenue, on one side of the GM Building.

Elsewhere, Thor is selling a $96 million retail portfolio in Soho to Acadia Realty Trust. And the company is looking to sell a big-box store in Gravesend, Brooklyn, that’s leased to BJ’s Wholesale Club with an asking price in the mid-$70 million range.


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