Savanna Pays $255M for Manhattan Office Asset

November 21, 2024

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The buyer acquired the distressed office property at a significant discount.

Exterior shot of 799 Broadway in Manhattan. — The 12-story office building came online on the former site of a 19th-century hotel that was converted into office space in 1940. Image courtesy of Savanna

Savanna has purchased 799 Broadway, a 176,588-square-foot office property in Manhattan, for $255 million—about $1,444 per square foot. Columbia Property Trust and Cannon Hill Capital Partners sold the asset. Eastdil Secured brokered the deal.

The buyer acquired the distressed office property at a discounted price through a lender-controlled sale process administered by Blackstone. In 2022, Blackstone provided $270 million to refinance the mid-rise, according to The Real Deal.

The 12-story building came online in 2022 on the former site of an 1873-completed hotel that was converted to office space in 1940.

A partnership between Ares Management and Normandy Real Estate Partners bought the building in 2016 for $101 million, New York YIMBY reported. In January 2020, Columbia Property Trust acquired Normandy Real Estate Partners, assuming the ownership of the company’s assets, CommercialEdge data shows.

At the time of sale, the LEED Gold-certified property was 71 percent leased with an 11-year weighted average lease term. The tenant roster includes Bain Capital Ventures, NewRez and Wellington Management, according to the same source.

Designed by Perkins + Will, the building features private terraces, tenant lounge and ample outdoor space. Located within the Greenwich Village neighborhood of Lower Manhattan, the mid-rise also has more than 23,000 square feet of retail space and a fitness center.

Eastdil Secured Managing Directors Will Silverman and Gary Phillips led the team that brokered the transaction on behalf of the buyer and seller.

Manhattan office sales volume still leads nationally

Manhattan’s office investment volume year-to-date through October reached almost $3.3 billion, according to the latest CommercialEdge office report. Assets in the market traded for $344 per square foot on average, almost double the $177 national figure.

Following a significant period of a depressed market, some of Manhattan’s office metrics are showing improvement, such as a drop in vacancy and steady transaction activity. Still, buildings are trading at significantly lower prices.

In one of the largest transactions this year so far, RFR Realty sold 980 Madison Ave., a 118,635-square-foot asset, for $560 million after defaulting on its $197.6 million CMBS loan. The property changed hands for roughly $4,717 per square foot.