9 Times Square under contract for $63.5m

The American Strategic Investment Company is in contract to sell 9 Times Square for $63.5 million to an unknown buyer, the investor announced in a press release. 

ASIC purchased 9 Times Square in November 2014 for $162.3 million, according to the company’s website. The property is located at 200 West 41st Street near Seventh Avenue in Times Square, and holds office and retail space. 

In the press release, ASIC CEO Michael Anderson said that he expects the sale to net the company $13.5 million, though it’s unclear how the company plans to net a profit on a $63.5 million sale on a building it purchased for $162.3 million. It’s also not clear who the buyer is. Representatives for ASIC could not be reached for comment. 

The contract is just the first step in the company’s move to diversify into “higher-yielding investments in assets beyond Manhattan real estate,” the company wrote in its latest investor presentation. 

The firm is also exploring selling a commercial building at 123 William Street and the retail space at 196 Orchard Street, also in Manhattan. Taken together, the three sales would unload 67 percent of the company’s current square footage, most of it at 123 William. The sales are intended to reduce the company’s leverage. 

ASIC owns six other properties in New York City, including another commercial property at 1140 Sixth Avenue. The firm has a total portfolio value of $725.5 million, according to the investor presentation. 

A report last month from city comptroller Brad Lander shows that office vacancies have nearly doubled from 6.4 percent in early 2020 until now. Some of that increase is attributable to a decline in leases from finance, insurance, and real estate tenants, The Real Deal previously reported. There are, however, signs of life in the borough’s office market, with leasing up 70 percent year-over-year in May. 

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The Times Square area appears to be recovering particularly well from the pandemic, led by new retail business openings and hotel occupancy. In 2023, Times Square saw the highest volume of commercial sales over $1 million in all of New York City, with a total value of $706 million across 10 deals. 

Despite this, ASIC may have struggled to generate sufficient revenue from the property. The building was 29 percent vacant as of March, according to its most recent investor presentation, an improvement from the end of 2022, when it was 38 percent vacant.