Empire Capital, Namdar Might Surrender NYC Office Building

Igal Namdar’s Namdar Realty Group may be losing its grip on a piece of its office portfolio.

Namdar and Empire Capital Holdings are in talks to hand back the keys at 345 Seventh Avenue to Benefit Street Partners, Commercial Observer reported.

A lawyer for the owners said in an email that the property is “in the process of being returned to the lender” but a date has not been set, according to the Observer.

Namdar COO Dan Dilmanian said the firm is “in early-stage talks about the future of 345 Seventh Avenue” but there is not yet a formal agreement to give back the building. He added: “We are also willing to work with the lender to find a path forward for retaining ownership.”

The joint venture snapped up the century-old office building near Penn Station and three smaller buildings for $107 million in 2021. Financing included a $78 million mortgage from Benefit Street and $7 million in mezzanine debt.

Warning signs were clear at the time, as the occupancy rate of the four buildings was 59 percent and more than 93 percent of leases were set to expire in 2026.

Namdar and Empire Capital have joined forces on several deals in Manhattan’s office market. Last year, when Empire acquired 529 Fifth Avenue for $107.5 million from Silverstein Properties, Namdar was part of the buyer group. Two years ago, they combined to buy 830 Third Avenue, a 14-story Midtown building, for $72 million from AEW Capital Management.

And just last month they snapped up 321 West 44th Street in Hell’s Kitchen from an affiliate of Related Companies for $50 million in a short sale.

Namdar’s leader, Igal Namdar, is known to bet on struggling Class B and C malls in smaller cities throughout the United States. Namdar Realty Group owns and manages about 57 million square feet of commercial real estate across the country.