Related Companies, a major New York City real estate developer, is reportedly selling the nearly 100-year-old iconic commercial building for about 67% off the price paid by Stephen Ross' real estate empire.
The 10-story building at 321 W 44th St (between 8th and 9th Avenues) has been home to the famous Birdland jazz club for nearly 40 years and also houses a branch of Gyukaku Japanese barbecue joint. Other tenants include advertising agency AKA.
It's home to the legendary Record Plant Studios (now Sony-owned Battery Studios), where celebrities like John Lennon regularly recorded. The last photograph of John by Bob Gruen with his wife Yoko Ono was taken outside the building in December 1980. On the east wall, a colorful, retro-inspired mural created by Brooklyn-based artists Patrick McNeil and Patrick Miller (collectively known as FAILE) pays homage to the building's history.
Related bought the property in 2018 for nearly $153 million and has now sold it to Empire Capital Holdings and Namdar Realty Group for less than $50 million, as first reported by Bloomberg.
Prior to 2018, the building had been purchased by Tokyo-based Jowa Holdings Co. Ltd. in 2015 for $165 million, records show.
Local leaders in Hell's Kitchen and across the city have long called for Midtown's commercial space, such as the art deco McGraw-Hill building on West 42nd Street, to be converted to residential use as the city recovers from the pandemic and workers continue to return to offices at a slow pace.
Office properties across the country are losing value as remote work increases, with rising costs leading some owners like Related Inc. to foreclose on certain buildings or sell them off to “cut their losses,” according to Bloomberg.
The past few years have been particularly tough for older office buildings, as opposed to the neighborhood's flashier ones like Hudson Yards (also owned by Related), The New York Times reported last week. Overall, the number of office buildings that have reached “crisis levels of stress relief” remains small, the Times said, but there has been a “surge this year” and the worst may be yet to come.
Hell's Kitchen commercial office buildings have been plagued by a volatile market in recent years. Last fall, the 50-story Worldwide Plaza announced the departure of tenants Cravath, Swaine & Moore and Nomura Holdings Inc.
In June 2023, CBS explored selling the historic Broadcasting Center, which occupies an entire block on West 57th Street, but no sale has yet taken place, according to property records.
When W42ST asked Birdland owner Gianni Valenti if he expected a proportional (67%) reduction in rent, he laughed and replied, “From your mouth to God's ears!”
