Kenneth Griffin in contract to pay St. Bart’s up to $78M for Midtown East air rights, his second deal

Kenneth Griffin of the hedge fund Citadel LLC signed a contract May 9, 2023, to buy up to 250,000 square feet of development rights for $312.50 per foot from St. Bartholomew’s Church, for the development of a 1.7 million square foot Midtown East office tower at 350 Park Avenue, that Griffin and partners Vornado Realty Trust and Rudin Management plan to build. The contract was disclosed in a court filing yesterday that is required when a nonprofit or religious entity seeks to sell a significant asset. St. Bartholomew’s Church is located at 325 Park Avenue.

Case LINK

Crain’s reported on the court filings yesterday.

Griffin can build the tower with the partners or go it alone, according to media reports. Griffin signed a similar contract with St. Patrick’s Cathedral to buy up to 525,000 square feet for the same price, $312.50 per foot. Griffin also needs to make a payment to a city fund totaling $61.50 per foot or 20 percent of the purchase price, whichever is greater.

The block

On this tax block, PincusCo has identified the owners of 10 of the 15 commercial properties representing 1,882,360 square feet of the 2,067,997 square feet. The largest owner is Feil Organization, followed by Jack Resnick & Sons and then Macklowe Properties. There are no active new building construction projects on this tax block.

The owner

The PincusCo database currently indicates that Vornado Realty Trust owned at least 54 commercial properties with four residential units in New York City with 15,154,375 square feet and a city-determined market value of $6.8 billion. (Market value is typically about 50% of actual value.) The portfolio has $5.5 billion in debt, with top three lenders as JPMorgan Chase, Goldman Sachs, and Morgan Stanley respectively. Within the portfolio, the bulk, or 78 percent of the 15,154,375 square feet of built space are office properties, with retail properties next occupying 12 percent of the space. The bulk, or 97 percent of the built space, is in Manhattan, with Bronx next at 3 percent of the space.

The surrounding

Within a 400-foot radius of 53 East 51 Street, PincusCo identified four commercial real estate items of interests occurred over the past 24 months. One of those four items was a sale which Vornado Realty Trust and Rudin Management bought the 10,974-square-foot, office building (O2) on 39 East 51st Street for $40 million from the Niarchos shipping family on June 23, 2023. Of those four items, three were loans above $5 million totaling $235.6 million. The most recent of the three was Rudin Management in which borrowed $100 million from JPMorgan Chase secured by the 360,000-square-foot, one-unit office building (O2) on 39 East 51st Street and one other property on November 6, 2023.

Direct link to the property’s ACRIS page and link to DOB NOW portal.