Calling anyone with cash: There’s never going to be a better time to buy a piece of NYC.
“Values have come down a lot and stabilized in 2024 — and now present an opportunity,” said Ariel Property Advisors’ Shimon Shkury of the market for both office and multi-family buildings.
In fact, buyers are now getting pricing last seen 20 to 25 years ago. Office condos that were selling for $800 to $1,000 per foot in 2019 are now closer to $400 a foot. “Owners are negotiating because they want to stay alive,” said attorney Jay Neveloff, who heads real estate at Kramer Levin.
For instance, Michael Cohen’s Williams Equities paid $147.5 million for 470 Park Ave. South or $490 per foot; it sold in 2018 for $245 million. Savanna paid $255 million, or $1,380 per foot, to Columbia Property Trust and Cannon Hill Capital Partners in the lender-advised sale of 799 Broadway. That 2022-built, 185,000-square-foot office building cost $300 million to develop and is 71% occupied at high rents.
Zar Property New York bought two smaller deals for even less: 119 W. 57th St. on Billionaires’ Row for $27 million, or $170 per foot, and 30 W. 61st St. for $15.2 million, or $97 per foot.
“The people buying for sub-$300 per foot or sub-$200 per foot are taking a chance,” said Craig Waggner of Cushman & Wakefield. “The city is perceived as a safe haven and it’s hard to go wrong.”
In another steep valuation reset, Robert Moser’s Prime Group Holdings and Empire Capital will pay $50 million for the Ironworks project at 511-541 W. 25th St. in Chelsea. The sellers paid $148 million for it in 2019. The buyers will turn a portion into storage facilities.
Many of these bargain-basement prices come courtesy of owners and lenders who want to ditch properties dinged by factors including high interest rates, ground rent resets and regulations. Lenders are also initiating deals to sell both performing and underperforming notes.
“There is a lot of enthusiasm that we are through the worst, but also caution about the trajectory of the healing,” added Andrew Scandalios of JLL. “It’s tilted positive for equities and the buy-side investors are bullish, but they are all cautious and selective about the quality of what they are buying.”
“The people buying for sub-$300 per foot or sub-$200 per foot are taking a chance … the city is perceived as a safe haven and it’s hard to go wrong.”
Craig Waggner of Cushman & Wakefield
High-net-worth individuals, family offices and international groups are also kicking bricks and buoying the market.
“The international community will be more focused on higher quality and we are seeing some Asian investors that want to chase distressed opportunities,” said Doug Middleton of CBRE.
For instance, SL Green sold an 11% stake in the trophy One Vanderbilt to the Japanese family-owned Mori Building Company, revaluing the tower at $4.7 billion or around $3,000 per foot.
In this rising market, owners are more willing to bring in new equity, even if it leaves them with a smaller share, Neveloff explained. To capitalize on that interest from wealthy foreign investors, Neveloff’s firm is merging with an international law firm with 23 offices around the world and after May 1, will be known as HSF Kramer in the US.
“The market is bouncing off the bottom and has created a foundation for the recovery,” noted Douglas Harmon of Newmark. “There will be new opportunities at significantly reduced prices.”
He and Adam Spies marketed the office portion of Morgan Stanley’s 500 Park Ave., which is being sold to SL Green for $130 million; and 2 Park Ave. being purchased by Haddad Brands for $360 million — that seller paid $519 million in 2007.
The newly developed offices and retail at Essex Crossing at 145 and 155 Delancey St. in the base of residential towers were taken over by lender Deutsche Bank for its loan of $236.9 million and will likely be resold.
But the poster child for the steep reset in values is the former Sports Illustrated Building at 135 W. 50th St., which was purchased in early 2024 for $8.5 million; it once traded for $332 million.
Now, after a ground lease rent reset, the buyer, Texas-based Thakkar Developers, is targeting $150 million in renovations.
With deals this good floating around, Marx Realty CEO Craig Deitelzweig might as well speak for the entire industry when he told The Post, “We want to buy more.”
