Dealmaker: 850 Third Avenue Trades for $422M

Midtown Manhattan office property 850 Third Avenue sold for $422 million–down $41 million from its last sale in 2016.

Real estate website first reported a partnership between HNA Property Holdings, ATCO Properties and Management and MHP Real Estate Services sold the Class A office building to The Chetrit Group, New York.

HNA paid $463 million for the 21-story, 617,000-square-foot tower in 2016, “amid an acquisition spree that saw it pick up a bevy of trophy Manhattan skyscrapers,” The Real Deal New York said. HNA presently faces financial difficulties; Reuters noted the governmental agency China Development Bank is supervising the firm’s asset sales as HNA seeks to scale back its operations.

In addition to HNA’s financial challenges, Asian real estate website noted the Committee on Foreign Investment in the United States, an American regulatory agency that reviews the national security implications of foreign investments in U.S. companies or operations, suggested HNA should sell the building due to security concerns.

Minority partners MHP Real Estate Services and ATCO Properties & Management also sold their stakes in the property.

Last June Natixis and Paramount lent $342 million to refinance the 1960-vintage asset. NKF Capital Markets and Cooper-Horowitz structured the loan. The NKF Capital Markets team was led by Vice Chairmen and Co-Heads of Debt and Structured Finance Jordan Roeschlaub and Dustin Stolly with Managing Directors Chris Kramer and Nick Scribani. The Cooper-Horowitz team was led by Principals Richard Horowitz and David Horowitz.

The building is 91 percent occupied. The largest tenant, Discovery Channel parent company Discovery Communications, occupies 189,500 square feet, or 31 percent of gross leasable area, but has announced plans to vacate its space upon lease maturity in May 2020.