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Madison Ave Art Deco Tower Could Exceed $2B

Source: Crain’s New York

The hulking Art Deco skyscraper at 11 Madison Ave. next to Madison Square Park has hit the market and could fetch north of $2 billion, sources say. If the building changes hands for that amount, it would be one of the year’s biggest deals.

The 29-story, 2.2 million-square-foot building is owned by a partnership between the Sapir Organization and Los Angeles-based investment company CIM Group.

A spokesman for CIM said he could not immediately comment.

SL Green Realty Corp., the real estate investment trust that owns an adjacent office property at 1 Madison Ave., is said to be among the bidders angling for 11 Madison Ave. Foreign buyers, particularly from Asia, who have become an increasing force in the city’s real estate investment market, could also make a play for the tower, sources say.

CIM and Sapir had previously put the property on the market in 2012, but wound up pulling the plug on that sale when they could not get the price they wanted.

Holding onto the tower has proved to be a wise move, as property values in the city have dramatically increased since they first put the tower up for sale. The building is located in midtown south, the Manhattan neighborhood that has become the premier destination for technology and creative tenants. As a result, CIM and Sapir have been able to attract high-paying tenants to the building. The pair scored a huge deal when they signed a 500,000-square-foot lease a year ago with electronics and entertainment giant Sony, which will be moving its New York headquarters to the property from midtown.

Darcy Stacom, a broker at CBRE Group, is handling the sale of 11 Madison Ave. Ms. Stacom didn’t immediately respond to a request for comment.