Manhattan’s Class A office market is alive and well in the eyes of one of its biggest landlords.
Vornado Realty Trust and the Albanese Organization sold a West Chelsea property at 512 West 22nd Street for $205 million, sources told the Commercial Observer. Steven Roth’s company announced the deal on Wednesday without naming a buyer, which the Observer reports is Raghsa Real Estate, a subsidiary of Moisés Khafif’s Raghsa SA.
The deal for the 11-story, 172,000-square-foot building breaks down to $1,192 per square foot. The transaction is expected to close next quarter.
Eastdil Secured’s Will Silverman and Gary Phillips arranged the sale. Another broker from the firm, Grant Frankel, is seeking an acquisition loan expected to come in at 60 to 65 percent loan-to-value.
None of the parties involved in the deal commented to the Observer.
Vornado is set to make roughly $112.5 million from the sale of the property, where it had a 55 percent share in the building’s joint venture ownership with Albanese. Roth’s firm and Albanese will use the proceeds to pay off a $123.6 million mortgage.
Vornado redeveloped the property, formerly a five-story parking garage, as a spec office building a decade ago. PNC Bank provided a $55.3 million construction loan to fund the redevelopment, which came with a $130 million price tag.
WarnerMedia came on board as the building’s first tenant in 2019, agreeing to take 20,000 square feet. Small financial firms dot much of the remaining floors, including hedge fund manager Alexander Klabin.
The acquisition is one of the largest in Manhattan’s office market this year, a loud move for a firm that’s been relatively quiet in recent years. Five years ago, Raghsa shook up the pandemic-addled multifamily market by purchasing the 240-unit One Union Square South from Related Companies for $218 million.
— Holden Walter-Warner
This story has been updated to clarify that Raghsa Real Estate is was the buyer.