Namdar Realty Group, led by Igal Namdar, has acquired the ground lease for the property at 71 Fifth Avenue for 62 million dollars. The agreement covers the entire eleven-storey building at the intersection of Fifth Avenue and East 15th Street. The property provides Class B office and retail space and is situated at the junction of the two Manhattan submarkets of the Flatiron District and Union Square. Completion of the transaction was finalised on 22 October.
Background to the sale and ownership structures
A joint venture between Madison Capital and Lubert-Adler Partners acted as the vendor. The two partners had already started marketing their leasehold interest in the property in 2021. At the time, market participants considered sale proceeds of up to 150 million dollars achievable. The transaction was ultimately brokered by Helen Hwang, David Schechtman, Brian Szczapa, and Ian Shoenfeld from Meridian Capital Group.
According to Szczapa, the remaining term of the ground lease for Namdar is approximately 90 years. The underlying freehold land belongs to the family-owned company Samco Properties and the family of Mark Lapidus, the former global head of real estate at WeWork.
Madison Capital had acquired the ground lease for the property in 2016. The Midtown-based investment firm paid just under 85 million dollars at the time as a lump sum for the then fully let asset, alongside an annual ground rent of 3.5 million dollars. The point in time at which Lubert-Adler Partners joined the ownership consortium is not publicly documented.
Current occupancy and leasing status
An entire floor comprising 15,227 square feet is currently listed as available on the building's website. Existing occupiers of the property include well-known names from the technology and services sectors:
- —WeWork as a long-standing coworking operator
- —Adyen, a Dutch payments company
- —Captions, an artificial intelligence video editing start-up
- —City National Bank as a partial occupier of the ground-floor space
In addition, an unnamed artificial intelligence company recently secured around 30,000 square feet off-market. Beside the ground-floor retail space occupied by City National Bank, another shop unit remains vacant. Representatives of Namdar Realty Group, Madison Capital, and Lubert-Adler Partners did not respond to requests for comment.
