Sloan Kettering buys portion of SL Green’s Lipstick building, records $273M of $300M reported sale

Memorial Sloan Kettering purchased a portion of SL Green Realty’s Lipstick building, at 885 Third Avenue, recorded condo units and a ground lease with a total transfer price of $273 million. The entire purchase price was $300.4 million, SL Green reported in a press release.

In the first transaction recorded yesterday, Memorial Sloan Kettering through the entity S.K.I. Realty, Inc. paid $166.9 million to SL Green Realty through the entity 885 3rd Avenue Master Lessee LLC for condo units at 885 Third Avenue in Midtown East, Manhattan.he transaction price divided by square feet as reported in public records and assumes no air rights have been sold.)

In the second transaction, Memorial Sloan Kettering through the entity S.K.I. Realty, Inc. acquired an interest from SL Green Realty through the entity 885 3rd Avenue Realty Owner LLC valued at $106.1 million for office building (O4) at 885 3rd Avenue in Midtown East, Manhattan. The deal closed on December 16, 2022 and was recorded on December 27, 2022.
The signatory for SL Green Realty was Andrew S. Levine. The signatory for Memorial Sloan Kettering was Michael Harrington.

Because multiple properties have been transacted, some of the following sections will follow the property with the largest assessed value, which in this case, is the property on 885 Third Avenue.

Prior sales and revenue

Prior to this transaction, PincusCo has records that the buyer Memorial Sloan Kettering purchased 10 properties in three transactions for a total of $191.9 million and has no record it sold any properties over the past 24 months.
The seller SL Green Realty purchased five properties in five transactions for a total of $2.4 billion and sold 18 properties in 15 transactions for a total of $1.6 billion over the same time period.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the properties since September of 2020. In addition, according to city public data, the properties have not received any significant violations in the last year.

Development

There are no active new building construction projects or major alteration projects with initial costs more than $5 million on this tax lot.

The block

On the tax block of 885 Third Avenue, PincusCo has identified the owners of five of the 19 commercial properties representing 594,117 square feet of the 837,695 square feet. The largest owner is Yee Chee Lin, followed by Sol Goldman Investments and then Peter Ting.
On the tax block, there were two new building construction projects totaling 287,685 square feet. The largest is a 130-unit, 245,946-square-foot R-2 building developed by Shaz Mossanen with plans filed October 28, 2015 and permitted September 19, 2017. The second largest is a 29-unit, 41,739-square-foot R-2 building developed by Abraham Lokshin with plans filed November 13, 2019 and it has not been permitted yet.

The majority, or 72 percent of the 809,400 square feet of built space are office buildings, with elevator buildings next occupying 13 percent of the space.

The seller

The PincusCo database currently indicates that Sl Green Realty owned at least 40 commercial properties in New York City with 19,098,563 square feet and a city-determined market value of $7.8 billion. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 95 percent of the 19,098,563 square feet of built space are office properties, with elevator properties next occupying 4 percent of the space. They are all located in Manhattan.

The buyer

The PincusCo database currently indicates that Memorial Sloan Kettering owned at least two commercial properties in New York City with 557,700 square feet and a city-determined market value of $250 million. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 99 percent of the 557,700 square feet of built space are office properties, with A4 properties next occupying 1 percent of the space. They are all located in Manhattan.

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