Marc Holliday is suiting up for his next big office project.
SL Green is in contract to buy the former home of Brooks Brothers on Madison Avenue for $160 million, sources told The Real Deal. The property, a short walk from Grand Central Terminal at East 44th Street, could be developed into an 800,000-square-foot office tower.
“These assets are in an exceptional location just steps from One Vanderbilt,” SL Green Chief Investment Office Harrison Sitomer said. “As we continue to prioritize well-located opportunities in our core sub-markets, these properties provide us the opportunity to pursue a world-class, ground-up new office development in the heart of the strongest office market in the country.”
CEO Holiday has been teasing SL Green’s determination to put a large development site under contract this year ever since he first announced the plan at the company’s investor day in December.
“It’s among the highest priorities of things we’re working on right now,” he said during the REIT’s July earnings call. Holliday added that his team is also working on putting a significant redevelopment site under contract before the year’s end.
The iconic 11-story, 122,600-square-foot building at 346 Madison Avenue served as Brooks Brothers’ flagship store beginning in 1915. The company went bankrupt in 2020 and was purchased by Authentic Brands Group and Simon Property Group. The building, however, is still owned by the Brooks Brothers’ former owner, Italian billionaire Claudio Del Vecchio, who bought it in 2019 for $109 million.
He first put the property up for sale in 2021, and new marketing materials show renderings for a proposed tower dubbed 44+Madison. JLL is overseeing the sale process.
The Brooks Brothers deal would be the REIT’s first major construction project since it added more than 500,000 square feet of new office space on top of the Metropolitan Life Building at One Madison Avenue in 2023, bringing it to a total of 1.4 million square feet. The developer signed Franklin Templeton (350,000 square feet) and IBM (330,000 square feet) to large leases at the property.
Prior to that, SL Green in 2020 completed work on the 1.7 million-square-foot One Vanderbilt, which is just one block south of the Brooks Brothers site. The developer sold an 11 percent stake in the tower to Japan’s Mori Building Co. in November in a deal valuing it at $4.7 billion, making it possibly the most valuable office building in the country.
Manhattan is starting to see a new spurt of office development.
Boston Properties announced in June that it is moving forward with construction of its $2 billion, 1 million-square-foot office tower at 343 Madison Avenue after securing an anchor tenant.
Vornado Realty Trust, the Rudins and Ken Griffin’s Citadel are working through the public review process for their 1.8 million square-foot tower at 350 Park Avenue, and Larry Silverstein is in talks with American Express to kick off development of his long-awaited 2 World Trade Center.
RXR and TF Cornerstone are planning to lock in an anchor tenant by year’s end for their planned tower at 175 Park Avenue.
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