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distressed Midtown office building was sold back to its lender in a credit bid last month, with the lender setting an unusually low price of $23 million. This is a rare move, typically used for assets with little appeal, where the lender announces a low upset price and opens bidding at that level, making it unlikely for anyone to top it. In this case, the bondholders on the $41 million CMBS loan appear to have set the price below what would have made them whole, but high enough to incur an extra $477,000 in transfer taxes.

    The move suggests the lender was sending a message to bidders: they'll sell the building for $23 million or a 60% discount on the $62 million owed. At this price, the 85,000-square-foot building would have sold for $270 per square foot, but there were still no takers. It's unclear whether the lender was willing to entertain bids below their upset price, as it would make little sense to pay more in transfer taxes.

    The sale of 29 West 35th Street is a reflection of how undesirable a century-old, half-vacant Midtown office has become. The building sold for a significant discount, dwarfing the original loan amount and the lender's $62 million judgment. It also pales in comparison to the $30 million Sohayegh and Movahedian paid for the property in 2007 and the $80 million it hoped to fetch 10 years later.