Empire State Building sold for $57.5 million
FOR THE FIRST TIME IN FOUR decades, the same entity will both own the Empire State Building and hold the lease. Long-term leaseholder Empire State Building Associates has struck a deal with owners Donald Trump and the heirs of a Japanese business tycoon to purchase the Manhattan icon for $57.5 million.
Industry experts say the consolidation of owner and lease-holder will increase the building's value because better financing terms can be negotiated and it can be sold more easily.
Empire State Building Associates, controlled by New York property mogul Peter Malkin, holds a lease on the building through 2076. According to a source representing the investment group, the purchase contract has been signed and the deal will close by May 1. The transaction will have no effect upon the existing operating lease, the source said.
The terms of the deal reportedly give Trump and his partners more than $6 million of the sale's proceeds, plus additional expenses.
Empire State Building Associates purchased the 114-year leasehold on the Empire State Building in a 1961 sale-leaseback transaction with Prudential Insurance Co. of America totaling $65 million.
The leasehold on the 70-year-old landmark entitles the owner to collect $1.97 million per year in rent on the entire building. That amount drops to $1.72 million in 2013.
Although the Sept. 11 attacks made the building once again New York's tallest, security issues did not seem to affect Malkin's interest in acquiring the building. He initiated the deal less than a week after the terrorist attacks by asking for investors' approval to bid up to the $57.5 million asking price for the building.
London Bridge Tower will go up, planners say
A SLEEK NEW SKYSCRAPER is set to be built next to the famous London Bridge now that the planning committee of Southwark Bourough Council has given the London Bridge Tower the go-ahead. Demolition of the current site of the proposed 66-story building — which will be Europe's tallest — is scheduled to begin this month, with construction to conclude in 2006.
Irvine Sellar, owner of London-based Sellar Property Group that proposed the project, was unavailable for comment at press time. However, he told BBC news that he expects the project will fill London's void of quality office space. “More than that, I think London deserves a global landmark of this sort,” he said.
The 900,000 sq. ft. building's original design featured a circular 87-story tower, but it was later replaced by a “shard of glass” design by architect Renzo Piano. “The shape of the tower is generous at the bottom and narrow at the top, disappearing into the air like a 16th-century pinnacle or the mast top of a very tall ship,” Piano said in a statement.
Financial services firm PriceWaterhouseCoopers will occupy most of the office space in the building's lower half, while the upper half will be devoted to hotel and multifamily space.