iStar’s Safehold, Inc. pays $285M to UBS Realty Investors for office property in Midtown West

135 West 50th Street (Credit: Google)

iStar’s Safehold, Inc. through the entity 135 West 50th Street Ground Owner LLC paid UBS Realty Investors’s 135 West 50th Street Investors LLC $285.0 million for the fee position under the office building 135 West 50th Street in Midtown West. The deal closed on December 9, 2019, and was recorded on December 17, 2019. The transaction consists of 1 parcel, including the tax class office building tower type with 20 or more stories (O4). The property is 865,759 square feet. The parcel(s) have total development potential of 865,759 square feet.

Safehold purchased the fee under 135 West 50th Street, and at the same time created a ground lease for the building which it executed with the tenant, UBS. The ground lease was assigned a value of $221 million on Acris. The value on Acris is typically the net present value of the lease, which runs until 2123. The net present value implies a ground lease payment, using a capitalization rate of 5 percent, of about $11 million.

The DOB issued a major alteration (A1) initial temporary certificate of occupancy for the building on October 15, 2019.

This building had been subject to a ground lease regime in the past. In 2006 UBS acquired a leasehold on the property for $332.5 million from Murray Hill Properties, and in 2012 it bought the fee for $279 million from owners that included Suzanne Lehmann.

Safehold has been active acquiring ground positions, including recently buying the fee under 195 Broadway for $275 million.

Over the past five years, there have been 38 NYC Department of Buildings permit applications filed for this parcel valued at more than $20,000. There were 4 major renovation applications including a certificate of occupancy change (A1) filed with a total estimated value of $21,557,000. There were 34 renovation/alteration projects (A2) applied for with a total estimated value of $12,681,957.
Direct link to Acris document. link
Direct link to the city’s interactive property map, ZOLA. link

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