New York real estate investor David Werner is expanding his footprint in Midtown Manhattan further. According to industry sources, Werner has acquired a 49 per cent stake in the 605 Third Avenue office complex. The property, a 43-storey tower with approximately one million square feet of leasable space, will in future be managed jointly with existing co-owner Fisher Brothers.
The exact purchase price for the stake was not publicly disclosed. J.P. Morgan Asset Management, the previous co-owner alongside Fisher Brothers, had brought the 49 per cent interest to market in July based on an overall property valuation of 425 million dollars. The transaction was brokered by a Newmark brokerage team comprising Adam Spies, Joshua King, Adam Doneger, Doug Harmon, Marcella Fasulo and Avery Silverstein.
Focus on traditional office use without conversion plans
Although David Werner is significantly involved in office-to-residential conversion projects in the New York market, including the former Pfizer headquarters at 219-235 East 42nd Street, he has no conversion plans for 605 Third Avenue. The building is to continue operating entirely as an office property.
- —Commercial law firm Hodgson Russ
- —Law firm Katsky Korins
- —Specialist publisher and events company Informa
For Werner, this acquisition represents his second commitment in the traditional Midtown office segment within the past year. Last December, the investor acquired the nearby tower One Dag Hammarskjöld Plaza for 270 million dollars from Rockpoint.
Background to the transaction structure
David Werner's entry follows a shift in financing strategy at Fisher Brothers. The firm had previously withdrawn plans for a bond issue on the Israeli capital market after international investor interest fell short of expectations against a backdrop of rising interest rates and shifting market conditions. The company originally intended to raise around 100 million dollars via unsecured bonds to acquire the 49 per cent stake from J.P. Morgan Asset Management itself and to fund capital expenditures and leasing costs in its existing portfolio.
