The company formerly known as New York City REIT may have changed its name, but it hasn’t yet turned around its fortune.
The firm, renamed last year American Strategic Investment Co., is set to lose Weill Cornell Medicine at 400 East 67th Street, Crain’s reported. Cornell University’s medical school will vacate 30,000 square feet of lab space when its lease expires next month, according to bond rating firm KBRA.
American Strategic purchased the commercial space of the 31-story property, known as The Laurel, in 2014; it acquired the space, plus a parking garage in the former Trump Place on the Upper West Side, for $85 million.
The value of those properties has plummeted in recent years, KBRA estimates. The bond rating agency lowered its outlook on the $50 million mortgage attached to the properties, citing Cornell’s exit among other things. The building’s commercial space is fully occupied outside of Cornell’s impending departure.
Weill Cornell is “considering consolidating some of our locations into other currently leased or owned building space to maximize these other properties by the end of the year,” according to its executive director of public relations.
Meanwhile, ASI recently put three properties in Manhattan up for auction. Among those are 9 Times Square, which is a whopping 30 percent vacant. The firm’s portfolio spanned as much as 1.2 million square feet, but its collection of Class B office space has not fared well since the start of the pandemic.
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The landlord changed its status last year from a real estate investment trust to a taxable C corporation amid troubling occupancy numbers and a challenge from an activist investor. ASI shares trade at 9 percent of book value, according to Yahoo Finance, suggesting investors have lost faith in management’s ability to take advantage of its portfolio.
In the fourth quarter, ASI reported revenue of $15.4 million against a net loss of $73.9 million, which included a non-cash impairment on an office property.