Tuesday, February 20, 2007

Sotheby's Manhattan HQ For Sale for $500 Million

MSN Money / Financial Times - February 18, 2007

Sotheby's in New York, one of the world's most glamorous auction houses, is itself coming up for sale with an asking price of about $500m

It is understood that RFR Holding, the private property company that owns the building at 1334 York Avenue on Manhattan's Upper East Side, has hired agents Jones Lang LaSalle to sell the property.

Sotheby's, which was set up in 1744, has been in New York for nearly 100 years and will remain at the site as a tenant of the new owner.

Sotheby's bought the site for just $11m in 2000. But the auction house has spent $140m on a giant makeover that increased it from four floors to 10 and created a total of 470,000 sq ft of space. Architects Kohn Pedersen Fox, which oversaw the redevelopment, replaced the building's old granite front with glass in various degrees of transparency, creating what one tourist guide now calls an "ethereal box".

RFR bought the building for $175m in 2002 in a sale-and-leaseback under which Sotheby's would remain for up to 40 years. The New York property company subsequently brought in Sachsenfonds, a German fund, as an investment partner.

In the past five years, property values in New York – and globally – have soared, pushing cap rates (yields) down to record lows, prompting the sale. Sphere: Related Content

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