By Gail Kalinoski
New York City—Cove Property Group and Baupost Group have teamed up to buy 441 Ninth Ave., an eight-story office building on Manhattan’s Far West Side, near the Hudson Yards and 1 Manhattan West mega-developments, for $330 million. The new owners plan to renovate the asset into Class A office space.
The joint venture purchased the 423,000-square-foot building from EmblemHealth, which had owned the property since 1994. It was originally built as a warehouse in 1962 and converted to offices in 1983.
CBRE Capital Markets arranged the sale. Darcy Stacom, Bill Shanahan, Eric Negrin, Ryan Spector and Paul Haskin of CBRE’s Midtown Manhattan office represented the seller, which will be vacating the building in 2017 after a short-term leaseback.
Shawn Rosenthal and Jason Gaccione of CBRE Capital Markets’ Debt & Structured Finance team in Midtown Manhattan secured the acquisition financing for the buyers.
The new owners received a $220 million acquisition loan from Deutsche Bank, according to The Real Deal.
The property is one block east of Hudson Yards, the major mixed-use development being built by Related Cos. and Oxford Properties Group, and one block west of Penn Station. It is located between 34th and 35th streets along the entire block front on Ninth Avenue and across the street from Brookfield Property Partners’ One Manhattan West, a 2.1 million-square-foot, 67-story office tower under construction. The building is also close to the new seven train extension servicing the Hudson Yards district, as well as the Lincoln Tunnel and bus lines.
The asset has expansive 50,000-square-foot floor plates with 14-foot ceilings. Cove’s business plan is to reposition the property as a Class A office development aimed at TAMI (technology, advertising, media and information) tenants as well as fashion, financial and legal firms. The joint venture also expects to build atop the existing building, adding about 210,000 square feet of available floor area ration to the site, according to CBRE.
In March, Cove and another joint venture partner—Multi-Employer Property Trust, advised by Bentall Kennedy LLP—acquired a 26-story, 476,000-square-foot office building at 2 Rector St. in Manhattan’s Financial District for a reported $225 million. Cove and MEPT planned to renovate and reposition the 1907 building into Class A offices. Like 441 Ninth Ave., that property is near another major Manhattan development—the new World Trade Center site.