Savanna Dumps Office Properties for Second Time in a Week

Savanna is one of the most active players in the New York City office space these days, a narrative furthered by yet another investment sale.

Chris Schlank and Nick Bienstock’s firm is in contract to sell a pair of properties around Madison Square Park to Kaufman Investments for a combined $125 million, the Commercial Observer reported. The properties include 24-28 West 25th Street (which is technically two buildings) and 48 West 25th Street.

The deal is expected to close in the coming weeks with financing assistance from Rialto Capital. Eastdil Secured’s Gary Phillips and Will Silverman arranged the sale.

The properties are on the same block directly west of the park. All of them are 12 stories tall and acquired by Savanna between 2018 and 2019 for a combined $197 million, meaning the seller is taking a large haircut on the deal.

None of the parties involved in the deal immediately responded to a request for comment from the publication.

The deal could open a host of possibilities for Kaufman, an affiliate of Kaufman Organization. A few months ago, the Kaufman Organization and AXA Financial sold the 137,000-square-foot office building at 40 West 25th Street in the Flatiron District to Kaufman Investments and Two Sigma Real Estate for $52 million, or $380 per square foot. That boutique office neighbors 48 West 25th.

Savanna, meanwhile, has been all over the property transaction ledger in Manhattan recently, on both the buyer and seller side.

Last week, Olmstead Properties snapped up a Midtown office building for $108 million, a steep markdown from its last trade in 2017, The Real Deal learned.

Olmstead bought the 16-story, 303,000-square-foot property at 19 West 44th Street from Savanna, almost a decade after the private equity firm paid $195 million for the Class B building between Fifth and Sixth avenues. Savanna spent $20 million on upgrades to the building.

But Savanna acquired the leasehold on Westbrook Partners’ 444 Madison Avenue for $50 million in September, marking its third office property acquisition in New York in nine months despite the company’s own financial distress.

— Holden Walter-Warner