GDS Development, Klövern buy Midtown East co-op for $184M

Rezoning allows for larger office building

New York /
Feb.February 18, 2020 06:33 PM
From left: GDSNY CEO Michael Kirchmann, 417 Park Avenue and Klövern CEO Rutger Arnhult (Credit: Google Maps)

From left: GDSNY CEO Michael Kirchmann, 417 Park Avenue and Klövern CEO Rutger Arnhult (Credit: Google Maps)

Klövern AB of Sweden and GDS Development Management have paid $184 million for all 29 units at a Midtown East co-op building, paving the way for the partnership to take advantage of the neighborhood’s rezoning.

The companies purchased all the apartments in 417 Park Avenue, a 14-story co-op constructed in 1916. The property is located within the 70-plus blocks the city rezoned in 2017, allowing for the address to have an office building with a floor-area ratio of 25, or nearly 220,000 square feet.

Crain’s reported last year that GDSNY (the rebranded abbreviation for GDS Development) was negotiating for the property. Representatives for the new owners declined to provide details on what they plan for it.

CBRE’s Bill Shanahan, Darcy Stacom and David Fowler advised the co-op owners on the deal. The owners had tapped the brokerage in 2018 after receiving various offers from investors.

Plans for at least three massive office towers in the rezoned area have been revealed. JPMorgan’s headquarters at 270 Park Avenue is expected to span 2.5 million square feet, while Harry Macklowe’s proposed office tower along East 51st and East 52nd streets could exceed 1 million. TF Cornerstone and MSD Partners plan a 2 million-square-foot mixed-use building in a $3 billion redevelopment of the Grand Hyatt at 109 East 42nd Street.

Also, Vornado Realty Trust and Rudin Management have designs for a tapered 1,450-foot tower at 350 Park Avenue. The plan — one of several being considered for the lot — would yield 1.68 million square feet of leasable office space.

At the time of the rezoning, city officials projected that the changes would spur the creation of 6.5 million square feet of office space.

GDSNY and Klövern have teamed up before. In 2018, GDSNY and Klövern acquired 322-326 Seventh Avenue for $36 million. The two also bought a 97-year ground lease at 118 Tenth Avenue in the Meatpacking District for $23 million last year. Leasing launched at the partnership’s office building at 1245 Broadway late last year.


Related Articles

arrow_forward_ios
43 East 53rd Street with ZG Capital Partners’ James Tamborlane and Bobby Zar (Google Maps, LinkedIn)
Bobby Zar buys Midtown office building for 15% less than 2015 price
Bobby Zar buys Midtown office building for 15% less than 2015 price
415 Madison Avenue and Rudin Management’s Bill Rudin (SOM, Rudin Management)
Rudin moves ahead with office building at 415 Madison Avenue
Rudin moves ahead with office building at 415 Madison Avenue
Silverback's Josh Schuster and Hopson's Chu Mang Yee with rendering of the project at 131-141 East 47th Street (LinkedIn, Getty, Ismael Leyva Architects)
Hopson nabs $156M for Midtown tower, agrees to part ways with Silverback
Hopson nabs $156M for Midtown tower, agrees to part ways with Silverback
Vanke US managing director Kai-yan Lee, RFR’s Aby Rosen and 100 East 53rd Street (Vanke US, Getty, M18 Public Relations)
With Aby Rosen out, Chinese developer slashes Midtown condo prices
With Aby Rosen out, Chinese developer slashes Midtown condo prices
Retail landlord Jack Terzi and 240 East 54th Street (Jack Terzi)
Terzi owes $58M and counting on Midtown SoulCycle building: suit
Terzi owes $58M and counting on Midtown SoulCycle building: suit
825 Third Avenue in Manhattan in NYC with Durst Organization financial associate Lucas Durst (LinkedIn, 825 Third Avenue)
Durst scores $100M loan for 825 Third
Durst scores $100M loan for 825 Third
ZG, Rialto buying former Santander building for $105M
ZG, Rialto buying former Santander building for $105M
ZG, Rialto buying former Santander building for $105M
Recruiter snags 71K sf at SL Green’s 711 Third Avenue
Recruiter snags 71K sf at SL Green’s 711 Third Avenue
Recruiter snags 71K sf at SL Green’s 711 Third Avenue
arrow_forward_ios

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

Loading...