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SL Green sells stake in Manhattan office

by Andrea Waitrovich

SL Green Realty Corp. has sold a 40 percent interest in 11 Madison Ave. in Manhattan to PGIM Real Estate.

The transaction values the 2.3 million-square-foot, class A Midtown South office property at $2.6 billion, inclusive of the costs associated with lease stipulated improvements to the property. PGIM Real Estate’s purchase price wasn’t disclosed.

SL Green realized cash proceeds of approximately $480 million at closing, which will be used for debt reduction and other investment opportunities.

The partnership is seeking a modification to the mortgage on the property, which, if not obtained within six months after the closing, may result in SL Green repurchasing the sold interest from PGIM Real Estate. The partnership expects the modification to be granted during fourth quarter 2016.

PGIM Real Estate has a one-year option to acquire an additional 9 percent stake in the venture at the same gross property valuation of $2.6 billion. &

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