Rockrose Said in Talks to Buy Manhattan Office Tower for $370 Million
Rockrose Development Corp. is in negotiations to buy a midtown Manhattan office tower from Larry Silverstein and the California State Teachers’ Retirement System for $370 million, a person with knowledge of the talks said.
Rockrose, primarily a Manhattan apartment landlord, may reach an agreement with the owners of 575 Lexington Ave. in 60 to 90 days, said the person, who declined to be identified because the matter is private. The 35-story tower was the subject of a foreclosure filing last year by representatives of the property’s lenders.
A deal for $370 million would value the building at about $500 a square foot, the person said. The partnership of Silverstein, the developer of towers at the World Trade Center site, and the pension system known as Calstrs paid $416 million for the property in 2006, as real estate prices headed toward a peak, according to New York City records.
Tenants include Cornell University and the law firm Boies Schiller & Flexner LLP. The building has about $257.1 million of debt in a securitized first mortgage, according to data compiled by Bloomberg. The owners made a $75 million payment in October on the debt, which was originally $325 million.
The purchase price is well above “in-place collateral valuation,” Julia Tcherkassova, a Barclays Capital analyst, said yesterday in a research note. “We continue to believe that the assumption of in-place financing is likely.”
The debt is part of commercial mortgage-backed securities BACM-2007-1 and BACM-2007-2, data complied by Bloomberg show.
The talks were reported yesterday by Real Estate Alert, a commercial-property newsletter.
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