RXR joins Olayan on 550 Madison Avenue’s $300M redevelopment
Rechler’s firm paid undisclosed sum to invest as minority partner
RXR Realty has joined the local arm of Saudi Arabia’s Olayan Group on its $300 million repositioning of 550 Madison Avenue.
RXR invested an undisclosed sum to become a minority partner on the redevelopment of the 37-story, 850,000-square-foot Midtown office tower, Crain’s reported.
RXR chairman and CEO Scott Rechler said his firm could oversee the redevelopment work and help boost the planned upgrades.
“There are some things we have thought about shifting and tweaking in the project as we have gotten involved to meet the demands of the tenants that would take space here,” he said. “It’s about executing a vision to maximize the historic identity of the property and create a best-in-class office building.”
Olayan America bought the Philip Johnson-designed building in 2016 for $1.4 billion from the Chetrit Group and David Bistricer’s Clipper Equity, which had planned a $1.9 billion condominium conversion of the property known as the Sony Building, as The Real Deal first reported.
Olayan plans to renovate and reposition the building to attract office tenants. The investor’s plan hit a speed bump last year when preservationists opposed its design for the base of the tower, which would dismantle the lobby and replace it with a glass façade.
The developer completed the lobby demolition, but has backed off plans for the glass installation. The city’s Landmarks Preservation Commission is expected to approve designating the building a city landmark in the coming weeks.
CBRE is handling leasing at the tower. [Crain’s] – Rich Bockmann