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AR Capital’s NYC REIT to pay Blackstone $180M for 1140 Sixth Ave. leasehold

Fund manager paid $100M to bring the property out of default in 2011

From left: New York REIT's Michael Happel, Blackstone's Jonathan Gray and 1140 Sixth Avenue in Midtown
From left: New York REIT's Michael Happel, Blackstone's Jonathan Gray and 1140 Sixth Avenue in Midtown

UPDATED: March 24, 10:58: American Realty Capital’s New York City REIT is taking over the ground lease at the 22-story office building at 1140 Sixth Avenue in Midtown.

The firm will pay $180 million to the Blackstone Group for the privilege. The roughly 250,000-square-foot building, part of the Equity Office portfolio, is 91 percent leased, with City National Bank as its anchor tenant, according to a news release.

Blackstone has invested about $40 million in the building since it acquired the leasehold in 2011, when it paid $100 million for a non-performing note on the asset. Its previous owners, Rockpoint Group and Stellar Management (which also invested about $45 million in renovations), defaulted on the office building during the market collapse.

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The estate of Sol Goldman owns the land beneath the building.

Eric Anton, David Fowler and Andrew Scandalios of HFF marketed the building.– Ariel Stulberg

Correction: A previous version of this story identified the ground lease’s buyer as New York REIT. 

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