The new owner of 149 Madison Ave. plans to invest significant capital to perform a comprehensive renovation.
NEW YORK CITY—Columbia Property Trust has reached an agreement to purchase 149 Madison Ave.—a 127,000-square-foot office building in Midtown South—from a private family owner.
Published reports put the price of the deal at $88 million. A publicist could not confirm the price to GlobeSt.com. The transaction is expected to close later this year.
Eastdil Secured and Cushman & Wakefield represented the seller in the transaction. No further information on brokers or other transaction representatives were available at press time.
Located in the NoMAD district, on the southeast corner of 32nd Street and Madison Avenue, the 12-story building is subject to a ground lease that expires in January 2018 with fully coterminous tenant leases. At expiration, Columbia will own a fee simple interest in the land and building.
The new owner plans to invest significant capital to perform a comprehensive renovation of the property, including updating and upgrading its infrastructure, interior and exterior finishes, and common areas throughout.
Industry data reveals that the building is 95% occupied. Tenants include Broadway Suites, Momentum Search Group and the Skin Cancer Foundation.
“149 Madison offers a compelling opportunity to leverage our scale and expertise in New York at an attractive discount to replacement cost and to create value through repositioning and re-leasing the full building,” says Nelson Mills, president and CEO of Columbia Property Trust. “With over $600 million in proceeds available from our recently completed disposition program, the purchase of 149 Madison is a promising start to our plan to put capital to work in our target markets.”
Adds Adam Popper, SVP for Columbia in the Eastern region, “The expiration of both the ground lease and existing tenant leases at 149 Madison offer us a rare opportunity to renovate the entire building and mark to market rates on every floor, providing strong upside potential.
He continues, “We have already begun preparations to reposition this building over the next 18-24 months so that it will compete among the best product in the submarket.”
When completed, the acquisition of 149 Madison Avenue will be Columbia’s second asset in the Midtown South market and will provide the company with a portfolio of five office properties totaling two million rentable square feet here.