SL Green pays $122M for Soho retail
REIT may partner with investor Jeff Sutton on deal
SL Green Realty added to its retail portfolio with the $122.3 million acquisition of store space in Soho, the ever-trendy neighborhood that has seen record-breaking levels of sales over the past year.
The Midtown-based real estate investment trust best known for its massive Manhattan office portfolio purchased a 68,342-square-foot mixed-used property at 131-137 Spring Street, which has 100 feet of frontage between Wooster and Greene streets. The sale closed in December, the firm reported in its fourth-quarter earnings statement released yesterday evening.
SL Green President Andrew Mathias, speaking this afternoon on the firm’s fourth quarter earnings call, said the firm may bring Jeff Sutton, their frequent partner on retail projects, in on the deal.
“I would not necessarily speculate on who will or won’t be in the deal,” Mathias said. “We certainly could wind up venturing that asset with Jeff, possibly. Or not. Sometimes things come up so quickly.”
Marc Holliday, company CEO, noted later in the call that SL Green has partnered on many deals with Sutton, and added, “We certainly expect to do a lot of business with Jeff this year.”
View 2012 retail soho in a full screen map
Sutton did not immediately respond to a request for comment.
In addition to the retail, which is occupied by Burberry and Diesel, the property also has office space and six residential units.
SL Green’s purchase was the second most expensive retail property purchase in Soho, a neighborhood bounded by Lafayette Street and West Broadway and Houston and Canal Streets, since at least 2001, a review of data from Real Capital Analytics shows.
There were $588.7 million in Soho retail property sales in 2012 in 18 deals, according to an analysis by The Real Deal of Real Capital Analytics data. That’s the highest since at least 2001, the review shows. The next highest year was 2011, when there were 10 deals totaling $179.6 million. (TRD analyzed sales of properties classified as retail by Real Capital. Some commercial buildings such as 599 Broadway that also include significant retail were not included because they are not classified as retail.)
The most expensive property sale since 2001 was a partnership of Sutton, Thor Equities’ Joseph Sitt, Aurora Capital Management and the Adjmi family, which acquired 529 Broadway in December 2012.
“There has been a tremendous amount of inventory trading in a very short period,” Michael Glanzberg, principal at brokerage Sinvin Real Estate, said. “I think there is more to come. Somehow [Soho] has entered the sphere of ‘gotta have it.’ ”
Yesterday, it was reported that Sitt and Sutton are partnering to buy out their partner in the office and retail property, 560 Broadway in Soho.
Correction: The original version of this article misidentified who made the initial comments about Jeff Sutton. It was Andrew Mathias, not Marc Holliday. Also, in the sales analysis for 2011, the article originally included a leasehold. That leasehold was dropped from the analysis, which is focused on property sales.