On behalf of Mount Sinai St. Luke’s, Cushman & Wakefield arranged the sale of the fee position of 1080 Amsterdam Avenue for $29,100,000. The property, located on the corner of Amsterdam Avenue and West 113th Street on Manhattan’s Upper West Side, is subject to a 99-year net lease that commenced in 2012.
The 20-story pre-war apartment building contains approximately 82,250 square feet and was leased in 2012 to a partnership of SL Green and Stonehenge, who have since completed a full gut-renovation of the entire property. Constructed circa 1932, the building features approximately 140’ of combined frontage and stands at nearly 200’ tall making it the tallest multifamily building in the area. It receives excellent light due to its southern exposure and offers stunning views of Midtown Manhattan, the Hudson River, and points east overlooking Morningside and Central Parks.
“As the fee owners of 1080 Amsterdam Avenue, Mount Sinai was pleased to work with Cushman & Wakefield on this transaction, the proceeds of which we plan to use to further enhance the quality health care services offered by and the comprehensive transformation of Mount Sinai St. Luke’s,” said Arthur A. Gianelli, President of Mount Sinai St. Luke's Hospital.
As fee owner, the purchaser will reap the long-term benefits of the property’s ideal location, adjacent to Columbia University, Morningside Park, St. Luke’s Hospital, and The Cathedral of St. John the Divine. The offering presented an excellent opportunity for investors to place long-term capital into one of the safest real estate investments available in the marketplace, a fee position secured by a fully-renovated and well-operated luxury apartment building. Features of the lease include ongoing capital improvement requirements, well defined use and assignment provisions, and frequent and substantial escalations inclusive of regular fair market value resets. The sale price represented a 00.86% capitalization rate on the in-place rent at the time of sale.
“Long term investors were very excited by the rapid escalation of rent to the fee position over the course of the next 18 years followed by three substantial fair market resets at 25 year intervals. The structure of the lease provides a rare investment vehicle with the safety of a long term bond and the potential yield of a value-add investment,” said Cushman & Wakefield’s Hall Oster, who exclusively marketed the fee position with President, New York Investment Sales, Paul J. Massey Jr., Teddy Galligan, and Andrew Berry. Massey added, “The marketing of this long-term, stable asset led to a bidding frenzy from a variety of deep-pocketed investors, which ultimately resulted in achieving the highest possible price for our client.” The same Cushman & Wakefield team structured the lease on behalf of Mt. Sinai St. Luke’s in 2011-2012.
Click here for press release
Neighborhoods: Upper West Side/ Agents: Paul Massey Jr.