SL Green Realty Corp. closed the purchase of Park Avenue Tower, a 36‑story, 621,824‑square‑foot Class A office building at 65 East 55th Street, for $730 million. The deal was financed with a new five‑year, fixed‑rate $480 million CMBS mortgage from Wells Fargo, with participation from JPMorgan and Bank of America. The stated coupon of 5.30% was hedged to an effective rate of 5.25%.
The tower, completed in 1986, has recently been upgraded with a redesigned plaza, pre‑built suites, and a world‑class lobby. Its location on Park Avenue places it in Manhattan’s most sought‑after office submarket, where vacancy rates have remained below 6% and demand from financial institutions and hedge funds remains strong.
The acquisition expands SL Green’s footprint on Park Avenue and is part of the company’s 2026 capital‑markets strategy. It follows the sale of a 49% joint‑venture interest in 100 Park Avenue to Rockpoint on January 6, 2026, and reflects the firm’s focus on portfolio optimization and capital recycling. The purchase adds a modern, architecturally distinctive asset that complements SL Green’s existing Park Avenue holdings.
Financially, SL Green has recently lowered its 2026 Funds From Operations (FFO) per share guidance to $4.4‑$4.7 from a higher range, citing higher operating expenses, real‑estate taxes, and tenant vacates. The guidance cut signals caution amid rising costs, but the acquisition is expected to enhance long‑term cash flow and support the company’s strategic objectives.
Chief Investment Officer Harrison Sitomer said the deal “fortifies our substantial presence on Park Avenue, the strongest office submarket in the country” and that the new financing, combined with the sale of the 100 Park Avenue stake, demonstrates progress on the 2026 capital‑markets strategy.
Analysts view the acquisition as a positive strategic move that strengthens SL Green’s market position, but they note the guidance reduction as a headwind. The market reaction reflects a mix of optimism about the portfolio expansion and caution regarding the company’s cost pressures and revised outlook.
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