Jeff Bezos and 424 5th Ave, Michael Shvo and 530 Broadway (Getty, SHVO)
New York’s investment sales market is often seen as a barometer for real estate the world over. And as the list of the Top 10 deals of 2020 shows, it was a rough year.
The largest deals totaled just about $5.5 billion worth of sales, a sharp decline from the $8 billion recorded in 2019.
Coming into the year, the landscape was already challenged. New rent laws put into place in 2019 were hampering sales activity for rent-stabilized apartment buildings. And while office leasing was robust, new supply of commercial buildings was a serious concern for investors. Then the pandemic hit, and deals got delayed and started falling apart — or never came together in the first place.
Here are the 10 largest investment sales of 2020:
1. 424 Fifth Avenue | $978 million
Buyer: Amazon
Seller: WeWork, Rhône Group
Brokerage: N/A
The biggest deal of 2020 almost wasn’t.
Amazon was supposed to buy the iconic Lord & Taylor building from WeWork and the Rhône Group back in September 2019. But WeWork twice pushed back the deadline before closing in March.
The purchase price works out to about $1,480 per square foot for the 11-story, 660,000-square-foot building.
WeWork bought the property in early 2019 for $850 million and had planned to lease it to Amazon before the two sides worked out a sale.
2. 410 Tenth Avenue | $952.5 million
Buyer: 601W Companies
Seller: SL Green Realty
Brokerage: CBRE
SL Green’s Amazon-anchored redevelopment in Hudson Yards was the biggest office deal to close post-pandemic. Buyer 601W Companies paid roughly $1,550 per square foot for the building.
As part of the deal, SL Green will retain a 5 percent interest in the 20-story redevelopment.
3. 330 Madison Avenue | $900 million
Buyer: Munich RE
Seller: Abu Dhabi Investment Authority
Brokerage: CBRE
This is another deal that got set in motion last year.
In June, the Abu Dhabi Investment Authority agreed to buy out its minority partner in the 1960s-era high-rise, Vornado Realty Trust, so that it could market the full 100-percent interest in the building for sale.
The purchase of Vornado’s 25 percent interest valued the property at about $900 million, or roughly $1,000 per square foot.
That’s the same valuation ADIA got when it turned around in March and sold the property to the German insurance company Munich RE.
4. 315 West 33rd Street| $446.5 million
Buyer: Brookfield Asset Management
Seller: SL Green Realty
Brokerage: CBRE
Brookfield bought this 36-story apartment building, known as The Olivia, through a fund called Brookfield Premier Real Estate Partners. The purchase included an adjacent plot of undeveloped land, with a purchase price that worked out to roughly $906 per square foot.
SL Green had purchased the 333-unit building in 2013 for about $387 million.
5. 1375 Broadway | $435 million
Buyer: Savanna
Seller: Westbrook Partners
Brokerage: Cushman & Wakefield
Savanna took a second bite at the 1375 Broadway apple when it purchased the Garment District building in July.
The company, led by Chris Schlank and Nick Bienstock, had originally owned the property after buying it in 2010 for $135 million. Savanna sold it to Westbrook Partners in 2015 for $310 million.
Savanna was able to close the deal despite the interruption from the coronavirus. The private equity firm went into contract on the property in February right before the city shut down. But Schlank and Bienstock liked the deal they put together and pushed through with the closing.
6. 265-275 Cherry Street | $435 million
Buyer: Related Fund Management
Seller: L+M Development Partners, CIM Group
Brokerage: Cushman & Wakefield
Related, which got its start investing in affordable housing, returned to its roots with this purchase of a 500-unit Section 8 property on the Lower East Side.
The deal was the largest multifamily transaction to close in New York since the start of the pandemic.
Ron Moelis’ L+M teamed up with the Los Angeles-based private equity firm CIM to buy the properties in 2013 for about $280 million.
https://therealdeal.com/2020/11/17/related-to-buy-section-8-buildings-for-435m/
7. 530 Broadway | $382 million
Buyer: Michael Shvo/Deutsche Finance America
Seller: Wharton Properties, Thor Equities
Brokerage: N/A
The voracious partnership between Michael Shvo and Deutsche Finance America continued the buying spree they kicked off in 2018 with the purchase of this Soho building in March.
Shvo and his German partner paid slightly less than the $400 million price they negotiated when they went into contract on the building in February.
Jeff Sutton and his partner Joe Sitt had considered selling the building back in 2016, at which point they were asking $450 million.
8. 10 East 29th Street | $380.6 million
Buyer: Global Holdings Management
Seller: Invesco Real Estate, Los Angeles County Employees’ Retirement Association (LACERA)
Brokerage: Eastdil Secured
The Instrata in Nomad traded for about $970,000 per unit in February.
Invesco Real Estate sold the 392-unit, market-rate building as an adviser for the owner, the Los Angeles County Employees’ Retirement Association.
The property was built in 1999. LACERA purchased it in 2013.
9. 522 Fifth Avenue | $350 million
Buyer: RFR Realty
Seller: Morgan Stanley
Brokerage: CBRE
Another deal that got its start amid the pandemic outbreak, Aby Rosen’s RFR Realty agreed to buy the 23-story office tower in March.
When the deal closed in September, the purchase price worked out to about $650 per square foot.
The seller, Morgan Stanley, occupies the building and plans to remain a tenant for the next three years. At that point, RFR will reportedly look to lease the office space to a single tenant starting in 2024.
10. 358 West 58th Street | $268.72 million
Buyer: Eldridge Industries
Seller: SBE Entertainment Group
Brokerage: N/A
The only hotel to make the Top 10 this year, the Hudson Hotel traded as part of a deal for hospitality mogul Sam Nazarian to shed some of his hotel properties. Nazarian’s SBE Entertainment Group closed a cash-and-asset-swap deal in November with French hospitality firm Accor in which he sold of his hotel management companies and doubled down on his restaurants and ghost-kitchen businesses.
At the same time, SBE sold the two hotel properties it owned – the Hudson Hotel in Manhattan and the Delano Hotel in South Beach – to Greenwich, CT-based Eldridge.