Thor Equities LLC offered to buy the title to New York’s Empire State Building for $1.4 billion, according to a letter from an attorney representing investors who oppose plans to put the skyscraper into a real estate investment trust.
Thor, run by Joseph Sitt, would acquire the fee title and master lease from Empire State Building Associates LLC, according to the letter from Stephen Meister to Thomas E.L. Dewey, attorney for Malkin Holdings LLC, the tower’s supervisor. The offer is “materially greater” than the $1.18 billion value of the building allocated to the company in filings supporting the creation of the REIT, according to the letter.
Meister’s son Jason Meister, a vice president at brokerage Avison Young, has been working to create a market for the tower and head off its inclusion in the REIT. The elder Meister has said on conference calls with unitholders that an outside offer would give them a choice to either cash in their shares or keep their interests in the tower.
“Thor’s offer now well exceeds the exchange value,” Stephen Meister wrote in the letter. “My clients urge Malkin Holdings to give earnest and serious consideration to Thor’s offer.”
Malkin Holdings in May won enough votes to proceed with the REIT, which would include the Empire State Building and 20 other New York-area properties. Last week, in response to a set of buyout proposals, the company said it’s in the “best interest” of investors to proceed with the REIT conversion, according to a letter by Malkin Holdings Chairman Peter Malkin and his son Anthony Malkin, the firm’s president.
Hugh Burns, a Malkin spokesman, declined to comment on the latest offer. Stefan Friedman, a spokesman for Sitt, also declined to comment.
Thor’s offer would give investors the opportunity to receive more in cash than the estimated value of the stock they would receive through an initial public offering, Jason Meister said in a telephone interview today.
In June, Thor made a bid of more than $2.1 billion for the building, an offer that would have included the purchase of a sublease. Today’s letter doesn’t mention the sublease, which is controlled by a company majority-owned by the estate of Leona Helmsley.