Jones Lang LaSalle
BIG EOP'S TINY NY DEAL
Peter Slatin
It's the little things that count, even (or especially) in the big picture.
After plunking down $505 million for the signature Verizon Building at 1095 Sixth Avenue in at the corner of 42nd Street in Manhattan and then pledging to spend at least $250 million to reskin and upgrade the building, Equity Office Properties has now added another increment to its plans: In a long-running deal that closed on June 6, Equity Office Properties has purchased 75% of the tenancy in common that owns the fivestory building at 124 West 42nd Street. The property is contiguous to the park that EOP acquired as part of their Verizon building acquisition last year. The giant office REIT's price tag for this decidedly non-trophy asset? $12.5 million.
A source close to the transaction suggests that Equity Office's interest is likely driven by the approximately 25,000 square feet of development rights that come with the deal. If the company wants to raze the building and transfer the development rights to the building they are now renovating; it's possible that EOP could add some high-voltage floorspace at the top of the 40-story building, which is being marketed for rents as high as $85 a square foot.
The tiny property has been in the hands of a tenancy in common structure, composed solely of members of the Kassover family, which has owned the building for some rour decades; it was once the headquarters of their electronics and appliance retail chain, VIM Electric Co., which was a major appliance seller from the 1930s to the 1970s. The remaining one-quarter interest in the asset is still owned by Phillip Kassover, one of the heirs of the appliance chain, who declined to participate in the sale to EOP. But EOP will have a chance to acquire that interest later this year: a New York State Supreme Court Justice has ordered the sale of the original Kassover property by a court appointed referee on September 12.
The acquisition was negotiated by Shobi Khan, EOP's senior vice president for acquisition and leasing in the New York area, and Neil Goldstein, an attorney with Robinson Brog Leinward Greene. The HI Group, a Chicago-based real estate investment bank, also participated in the deal.
The terms of the auction will most likely require bidders for the remaining 25% interest in the property to put up hard cash and close within 30 days of the sale.
Real estate sources believe EOP is also still negotiating with Verizon to buy a conference center the telecom giant sill owns on the site, and which wraps around 124 West 42nd and also extends from 42nd Street through to 41st Street.
A spokesperson for Equity Office declined to comment on the transaction.
BIG EOP'S TINY NY DEAL
Peter Slatin
It's the little things that count, even (or especially) in the big picture.
After plunking down $505 million for the signature Verizon Building at 1095 Sixth Avenue in at the corner of 42nd Street in Manhattan and then pledging to spend at least $250 million to reskin and upgrade the building, Equity Office Properties has now added another increment to its plans: In a long-running deal that closed on June 6, Equity Office Properties has purchased 75% of the tenancy in common that owns the fivestory building at 124 West 42nd Street. The property is contiguous to the park that EOP acquired as part of their Verizon building acquisition last year. The giant office REIT's price tag for this decidedly non-trophy asset? $12.5 million.
A source close to the transaction suggests that Equity Office's interest is likely driven by the approximately 25,000 square feet of development rights that come with the deal. If the company wants to raze the building and transfer the development rights to the building they are now renovating; it's possible that EOP could add some high-voltage floorspace at the top of the 40-story building, which is being marketed for rents as high as $85 a square foot.
The tiny property has been in the hands of a tenancy in common structure, composed solely of members of the Kassover family, which has owned the building for some rour decades; it was once the headquarters of their electronics and appliance retail chain, VIM Electric Co., which was a major appliance seller from the 1930s to the 1970s. The remaining one-quarter interest in the asset is still owned by Phillip Kassover, one of the heirs of the appliance chain, who declined to participate in the sale to EOP. But EOP will have a chance to acquire that interest later this year: a New York State Supreme Court Justice has ordered the sale of the original Kassover property by a court appointed referee on September 12.
The acquisition was negotiated by Shobi Khan, EOP's senior vice president for acquisition and leasing in the New York area, and Neil Goldstein, an attorney with Robinson Brog Leinward Greene. The HI Group, a Chicago-based real estate investment bank, also participated in the deal.
The terms of the auction will most likely require bidders for the remaining 25% interest in the property to put up hard cash and close within 30 days of the sale.
Real estate sources believe EOP is also still negotiating with Verizon to buy a conference center the telecom giant sill owns on the site, and which wraps around 124 West 42nd and also extends from 42nd Street through to 41st Street.
A spokesperson for Equity Office declined to comment on the transaction.
posted by Jones Lang LaSalle NJ News Blog at 9:55 AM
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