BY AL BARBARINO

Months of wrangling with dissenting investors finally earned Malkin Holdings the number of votes necessary to launch a REIT that would include the Empire State Building as an asset, but now the company says it is reviewing multiple offers that could lead to its sale.

The latest offer comes from one of the city’s largest landlords, Thor Equities, which offered more than $2.1 billion in cash to buy the storied asset. Peter and Anthony Malkin are apparently considering it, even though it would likely nullify their tireless pursuit to create the REIT.

“We received last week two unsolicited bids to purchase the Empire State Building,” stated a letter sent by the Malkins to shareholders and filed with the U.S. Securities and Exchange Commission late last month. “We are reviewing the offers and their terms. We consider all matters, including unsolicited offers, consistent with our fiduciary duties, to form a judgment on what action is appropriate.”

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BY GUS DELAPORTE

A 20,083-square-foot residential development site at 505-511 West 43rd Street is being marketed by HFF. The marketing team for the site is seeking $300 per buildable square foot, or nearly $50 million.

The site, located between 10th and 11th Avenues, can accommodate 160,664 square feet of zoning floor area and 190 residential units but is complicated by its location above an active Amtrak rail line. As a result, potential development will require two special permits, to be obtained through the city’s Uniform Land Use Review Procedure.

“You’re not going to have a basement,” Andrew Scandalios, senior managing director at HFF, told The Commercial Observer. “All of your amenities have to be above grade, which does take away from some floor area which would be used for apartments.”

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BY ROBERT KNAKAL

Low interest rates are a great thing and, simultaneously, they are a terrible thing. Let’s look at why and what is likely to happen to them moving forward.

Low interest rates are great for the real estate capital markets. Unfortunately, this is a short-term benefit.

Today, values for all property types in all geographical submarkets are higher, on a price-per-square-foot basis, than they were at the peak of the last cycle in 2007. In some sectors, values are significantly higher. Sure, underlying fundamentals have improved, but they have not improved enough to justify the large increases in value that properties have experienced. Our low interest rate environment is the main reason why values have escalated. From a real estate perspective, this is a great thing (especially for sellers).

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