Manhattan-based Silverstein Properties and joint venture partnerState Teachers’ Retirement System (CalSTRS), have closed on their acquisition of 575 Lexington Avenue, a 35-story, 600,000 sq. ft. tower at 51st Street. The partnership purchased the Midtown office building for $400 million (or roughly $667 per sq. ft.).
The acquisition of 575 Lexington Avenue marks the first under a new joint partnership between CalSTRS, a pension fund, and Silverstein Properties. The partnership provides Silverstein Properties with up to $2 billion in buying power to be used for acquisition purposes in the metropolitan area.
“For the past five years, Silverstein Properties has been focused on the World Trade Center, and will continue to devote enormous resources to the rebuilding effort. Having now built up our staff and coming off a successful agreement with the Port Authority on rebuilding the site, the timing on this newpartnership with CalSTRS couldn’t have been better,” says Larry A. Silverstein, President and CEO of Silverstein Properties.
Silverstein Properties will also serve as the management company for 575 Lexington Avenue. Following in the company’s tradition of renovating Manhattan office buildings, the partnership will make a significant investment to upgrade various features of 575 Lexington Avenue, including the lobby, elevator cabs, lighting systems, and façade work.
“Silverstein Properties is a key player in the New York real estate market. We are confident that our partnership with Silverstein Properties will provide positive long-term investment returns for our members,” said Michael Thompson, portfolio manager with CalSTRS. CalSTRS has been Silverstein Properties’ partner in 120 Broadway since 2004.
Major tenants of 575 Lexington Avenue include Cornell University, the law firm Boies, Schiller & Flexner and Radianz Americas, Inc. Retail tenants include New York Sports Club and Staples.