Scott Rechler’s RXR is buying 590 Madison Avenue for close to $1.1 billion — the most expensive office deal in New York in several years.
Rechler’s company on Friday signed a letter of intent to buy the 1 million-square-foot tower from State Teachers Retirement System of Ohio, the state’s teacher pension fund, sources told The Real Deal.
The price is “closer to $1.1 billion than it is to $1 billion,” said a source familiar with the deal.
There was intense competition for the building — one of the few trophy office properties in the Plaza District — and it drew attention from many of the biggest investors.
Tishman Speyer, Blackstone Group, SL Green and RFR had all been in the mix late in the process. Sources told TRD in April that Blackstone was the odds-on favorite to emerge as a buyer, and there was also a high-net-worth European investor who showed strong interest in buying the building.
The price, however, gave some bidders pause for concern. Several floated the idea of purchasing the building through installments, the Commercial Observer reported. But ultimately, the competition for the property led to a full sale.
A spokesperson for RXR declined to comment and a representative for STRS Ohio could not be immediately reached.
An Eastdil Secured team led by Will Silverman and Gary Phillips negotiated the deal.
The price makes the deal the first New York City sale to crack the $1 billion mark since Alphabet bought its Hudson Square office building. The Google parent company paid $1.97 billion for the property at 550 Washington Street in 2022.
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