Morgan Stanley is selling a 1 million-plus-square-foot Manhattan office property for $360 million, adding to a slew of other office sales that have traded for less than what the sellers paid.
The investment bank sold the property at 2 Park Ave. for $360 million, Newmark, which represented Morgan Stanley, said Thursday in a statement. Haddad Brands, the buyer, plans to occupy a portion of the property and lease the remainder, Newmark said.
Morgan Stanley bought the roughly 1.2 million-square-foot property for $519.4 million in 2007, which translates to a 31% discount in its sale to Haddad, according to CoStar data. Haddad, which makes and distributes children’s clothing for brands including Nike and Levi’s, is currently based at 100 W. 33rd St., according to its website.
The Class A, 29-story 2 Park, is within a 10-minute walk from both Grand Central Terminal and Penn Station. The art deco property features amenities including a 27th-story penthouse lounge and outdoor terrace, a ground-floor lobby, a conference center and bike parking.
The transaction comes as discounted office sales have been seen in cities from New York to Chicago. For instance, just a block south of 2 Park, a century-old Manhattan office property at 470 Park Ave. S known for its cast-iron clock featuring a wizard sold at a 40% reduction in price.
Nearby Times Square, UBS in October sold its property at 135 W. 50th St. for $8.5 million, a sliver of the $332.5 million it paid for in 2006, according to CoStar data.
In Chicago, three year-end transactions were also made at major discounts to pricing the last time the buildings traded.
Tenants aren’t just shopping office properties. For instance, fashion brands from Uniqlo to luxury label Prada have also bought prime Fifth Avenue retail properties in Manhattan that house their flagships.
Occupier-owner transactions rose 36% in the first three quarters of last year as more companies opt to purchase properties for a discount rather than lease, Newmark said.
For the record
Newmark co-heads of U.S. capital markets Adam Spies and Doug Harmon; executive vice chairmen Adam Doneger, Marcella Fasulo and Josh King; executive managing director Avery Silverstein; and director Willis Robbins represented the seller, Morgan Stanley.
Law firm Fried Frank advised Haddad on its acquisition. The Fried Frank team included partners Jonathan Mechanic and Nathaniel Lifschitz and associate Pia Levin.