- David Werner is acquiring a 49% equity stake in 605 Third Avenue, a 1M SF Midtown tower, and joins Fisher Brothers, which keeps the 51% majority. The price was not disclosed.
- Newmark brokered the deal. The building was 84% leased as of July, sits near Grand Central, and has a 14,000 SF lobby with 20 upgraded elevators, but repositioning plans are unclear.
- Werner, known lately for turning offices into apartments such as the former Pfizer headquarters, is also buying offices, which suggests appetite for operating Midtown towers near Grand Central.
Real estate investor David Werner is taking a 49% stake in 605 Third Avenue, a 1M SF Midtown office tower, GlobeSt reports, citing Commercial Observer.
Fisher Brothers stays on as the 51% majority owner. The price was not disclosed.
Get Smarter About What Matters in New York
Subscribe to our free newsletter covering the biggest commercial real estate stories across the five boroughs — delivered in just 5 minutes.
The Deal
In July, JPMorgan’s asset management arm put a $425M value on its holding, according to Commercial Observer as relayed by GlobeSt. Werner takes over the 49% slice that JPMorgan previously held.
Newmark’s six-person team, led by Adam Spies, Joshua King and Doug Harmon, brokered the transaction.
From Buyout Plan to New Partner
The stake has a history. In August, CRE Daily reported that Fisher Brothers planned to raise about $100M in Israeli bonds, partly to buy out JPMorgan’s 49%, according to The Real Deal.
GlobeSt reported over the summer that Fisher Brothers wanted another minority partner to help reposition the building. A spokesperson said the family-owned firm was bullish on the tower and its corridor.
The Asset
The tower sat 84% leased as of July. It sits between East 39th and 40th Streets, steps from Grand Central.
It has a 14,000 SF lobby and 20 upgraded elevators, plus a garden wall, outdoor space and service bars that hold up to 440 guests. GlobeSt notes it is unclear what the repositioning will involve.
Werner’s Midtown Playbook
Werner has recently focused on converting offices to housing. His biggest conversion project is the old Pfizer headquarters on East 42nd Street, which will become 1,602 high-end apartments.
He is also still buying offices. In June he paid $270M for One Dag, which CRE Daily covered as the One Dag deal: a 50-story, 870,000 SF tower Rockpoint bought for roughly $600M in 2019, with $250M of financing from J.P. Morgan.
Why It Matters
A buyer who has been converting towers is putting equity into an operating office. It is a vote for well-located Midtown buildings that already have tenants.
For Fisher Brothers, the deal brings a new capital partner to the asset.
What’s Next
Watch for the repositioning plan and whether the partners add new amenities or capital work to lift the 84% occupancy.
