NEW YORK, AUGUST xx, 2016 – SL Green Realty Corp. (NYSE: SLG), New York City’s largest commercial property owner, today announced that it has sold a 40% interest in Eleven Madison Avenue, to PGIM Real Estate, the real estate investment business of PGIM, Inc., the global investment management businesses of Prudential Financial, Inc. (NYSE: PRU). The transaction values the 2.3 million-square-foot, Class-A Midtown South office property at $2.6 billion, inclusive of the costs associated with lease stipulated improvements to the property.
SL Green realized cash proceeds of approximately $480 million at closing, which will be used for debt reduction and other investment opportunities. The partnership is seeking a modification to the mortgage on the property, which, if not obtained within six months after the closing, may result in SL Green repurchasing the sold interest from PGIM Real Estate. The partnership expects the modification to be granted during the fourth quarter of 2016.
PGIM Real Estate has a one-year option to acquire an additional 9% stake in the venture at the same gross property valuation of $2.6 billion.
SL Green’s co-chief investment officer, Isaac Zion, commented, “PGIM Real Estate shares our vision for Eleven Madison Avenue, a truly premier asset, and we are delighted to continue our long-standing, mutually beneficial relationship with this latest venture together.”
“PGIM Real Estate’s investment in Eleven Madison Avenue represents a unique opportunity to partner with SL Green and add to our portfolio another trophy-quality office property in Manhattan that will generate secure and stable income across market cycles,” said Kevin R. Smith, head of Americas for PGIM Real Estate.
Eleven Madison Avenue is located directly east of Madison Square Park between 24th and 25th Streets, and spans one full city block, with park frontage offering unobstructed west-facing views. The well-located office building has access to public transportation, including walking distance to five major subway lines, while the Madison Square Park area offers an abundance of walkable dining, retail, hotel and residential options.
Darcy Stacom and William Shanahan of CBRE advised SL Green on this transaction.
About PGIM Real Estate
PGIM Real Estate is the real estate investment business of PGIM, Inc., the global investment management business of Prudential Financial, Inc. (NYSE: PRU). Redefining the real estate investing landscape since 1970, PGIM Real Estate has professionals in 18 cities in the Americas, Europe and Asia Pacific with deep local knowledge and expertise, and gross assets under management of $65.4 billion ($48.3 billion net) as of March 31, 2016. PGIM Real Estate’s tenured team offers to its global client base a broad range of real estate investment vehicles that span the risk-return spectrum across core, core plus, value-add, debt, securities, and specialized investment strategies. For more information, visit www.pgimrealestate.com.
PGIM’s businesses offer a range of investment solutions for retail and institutional investors around the world across a broad range of asset classes, including fundamental equity, quantitative equity, public fixed income, private fixed income, real estate and commercial mortgages. Its businesses have offices in 16 countries across five continents and had more than US$1 trillion in assets under management as of March 31, 2016. For more information, please visit http://www.pgim.com.
About Prudential Financial, Inc.
Prudential Financial, Inc. (NYSE: PRU), a financial services leader with more than $1 trillion of assets under management as of June 30, 2016, has operations in the United States, Asia, Europe and Latin America. Prudential’s diverse and talented employees are committed to helping individual and institutional customers grow and protect their wealth through a variety of products and services, including life insurance, annuities, retirement-related services, mutual funds and investment management. In the U.S., Prudential’s iconic Rock symbol has stood for strength, stability, expertise and innovation for more than a century. For more information, please visit www.news.prudential.com.
About SL Green Realty Corp.
SL Green Realty Corp., an S&P 500 company and New York City's largest office landlord, is a fully integrated real estate investment trust, or REIT, that is focused primarily on acquiring, managing and maximizing value of Manhattan commercial properties. As of June 30, 2016, the company held interests in 119 Manhattan buildings totaling 44.7 million square feet. This included ownership interests in 28.1 million square feet of commercial buildings and debt and preferred equity investments secured by 16.7 million square feet of buildings. In addition, the company held ownership interests in 31 suburban buildings totaling 4.9 million square feet in Brooklyn, Long Island, Westchester County, Connecticut and New Jersey. For more information, please visit: http://slgreen.com/.
11 August 2016
SL Green and PGIM Real Estate form joint venture for ownership of Eleven Madison Avenue
Other articles in Investments:
- Prudential Investments adds six DCIO team members to support growth initiatives
- Prudential Capital Partners raises $1.8 billion for its fifth mezzanine fund
- Prudential Investments launches Prudential International Bond Fund
- Gary Stromberg joins PGIM Fixed Income to lead High Yield Energy Credit Research
- Prudential Investments launches the Prudential Day One Mutual Funds