Silverstein, Metro Loft pay $172.5M to Rudin for tower in FiDi, get $220M construction loan

Silverstein Properties and Metro Loft Management through the entity 55 Broad Street Owner LLC paid $172.5 million to Rudin Management through the entity 55 Broad Street L.P. for the office building (O4) at 55 Broad Street in Financial District, Manhattan. They plan to convert the building to 571 market-rate rental residential apartments. The Rudin family will retain a stake in the project, according to a Silverstein Properties press release.

The deal closed on July 28, 2023 and was recorded on August 4, 2023. The property has 406,025 square feet of built space according to a PincusCo analysis of city data. The sale price per built square foot is $424 per the PincusCo analysis. (The price per square foot analysis is the transaction price divided by square feet as reported in public records and assumes no air rights have been sold.)
The signatory for Rudin Management was Andrew Migdon. The signatory for Silverstein Properties and Metro Loft Management was Michael Levy and Nathan Berman. The contract date was May 22, 2022.

Silverstein Properties and Metro Loft Management obtained a $220 million construction loan from Banco Inbursa.

The Real Deal originally reported on the sale last year shortly after it went into contract.

 

Prior sales and revenue

Prior to this transaction, PincusCo has records that the buyer Silverstein Properties purchased four properties in two transactions for a total of $287.2 million and sold eight properties in three transactions for a total of $1 billion over the past 24 months.
The seller Rudin Management purchased one property in one transaction for a total of $40 million and sold two properties in two transactions for a total of $57.7 million over the same time period. The 406,025-square-foot property generated revenue of $16.4 million or $40 per square foot, according to the most recent income and expense figures.

The property

The office building in Financial District has 406,025 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 130 feet and is 183 feet deep with a total lot size of 23,132 square feet. The lot is irregular. The zoning is C5-5 which allows for up to 15 times floor area ratio (FAR) for commercial and up to 10 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $55.2 million.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the property for the past 24 months. In addition, according to city public data, the property has received one DOB violation and $935 in OATH penalties in the last year.

Development

There are no active new building construction projects or major alteration projects with initial costs more than $1 million on this tax lot.

The neighborhood

In Financial District, The majority, or 74 percent of the 79.9 million square feet of commercial built space are office buildings, with elevator buildings next occupying 15 percent of the space. In sales, Financial District has the 4th highest sale turnover among other neighborhoods in the city with $2.6 billion in sales volume in the last two years. For development, Financial District is the 3rd most active neighborhood among other neighborhoods. It had 9.7 million square feet of commercial and multi-family construction under development in the last two years, which represents 12 percent of the neighborhood’s built space. There was one pre-foreclosure suit filed among other office buildings in the past 12 months.

The block

On this tax block, PincusCo has identified the owners of two of the four commercial properties representing 91,553 square feet of the 736,649 square feet. The two identified owners are Skyline Developers and Madison Equities.
On the tax block, there was one new building construction project filed totaling 356,644 square feet. It is a 150-unit, 356,644 square-foot residential (R-2) building submitted by Madison Equities and filed by Andrew Manton with plans filed May 18, 2016 and permitted July 12, 2017.

The majority, or 88 percent of the 736,649 square feet of built space are office buildings, with specialty buildings next occupying 12 percent of the space.

The seller

The PincusCo database currently indicates that Rudin Management owned at least 19 commercial properties with 1,725 residential units in New York City with 7,052,811 square feet and a city-determined market value of $2.3 billion. (Market value is typically about 50% of actual value.) The portfolio has $870.5 million in debt, with top three lenders as JPMorgan Chase, Bank of America, and PGIM Real Estate respectively. Within the portfolio, the bulk, or 62 percent of the 7,052,811 square feet of built space are office properties, with elevator properties next occupying 38 percent of the space. They are all located in Manhattan.

The buyer

The PincusCo database currently indicates that Silverstein Properties owned at least nine commercial properties with 1,337 residential units in New York City with 12,982,989 square feet and a city-determined market value of $4.5 billion. (Market value is typically about 50% of actual value.) The portfolio has $3.5 billion in debt, with top three lenders as New York Liberty Development Corporation, Wells Fargo, and Bank of New York Mellon as trustee respectively. Within the portfolio, the bulk, or 90 percent of the 12,982,989 square feet of built space are office properties, with elevator properties next occupying 9 percent of the space. They are all located in Manhattan.
The PincusCo database currently indicates that Metro Loft Management owned at least five commercial properties with 912 residential units in New York City with 2,072,774 square feet and a city-determined market value of $522 million. (Market value is typically about 50% of actual value.) The portfolio has $540.7 million in debt, with top three lenders as Deutsche Bank, Athene Holding, and Valley National Bank respectively. Within the portfolio, the bulk, or 51 percent of the 2,072,774 square feet of built space are elevator properties, with office properties next occupying 49 percent of the space. They are all located in Manhattan.

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