Midtown showing strength with sale of apartment building, office tower

Two monumental transactions last week, both facilitated by the same powerhouse Newmark team, electrified the city’s investment-sale markets.But insiders said Miki Naftali’s $810 million purchase of rental apartment tower 800 Fifth Ave.

was more impactful for the luxury residential market than the $1.08 billion deal for 590 Madison Ave.was for the commercial one.“That is record pricing for a building of its size — 33 stories,” an industry source said of 800 Fifth Ave.

“And it’s also perhaps the best Manhattan location for a super high-end condo development.Really, can you beat Fifth Avenue and East 61st Street?”Naftali plans to demolish the building for a sexy new condo tower.

“We’re thrilled that after fifty years as the best rental building in the city, 800 Fifth will be transformed in the next incarnation to the best new condominium,” he said in a statement.That could require evicting or relocating tenants of 208 apartments.Sources said the mood in the building was subdued but not panicked as Naftali’s move came as no surprise.

Some tenants “hired lawyers months ago,” we’re told.A Naftali Group spokesperson would only say, “We look forward to sharing our vision for the contextual redevelopment of this site with the community in the coming months.”The 1978 building was developed by Bernard Spitzer, the late father of former Gov.Eliot Spitzer, and was owned prior to the sale by Spitzer Enterprises and Winter Properties.Meanwhile, Scott Rechler’s RXR closed on the $1.08 billion purchase of 1 million square-foot 590 Madison Ave.

at East 57th Street, the former IBM Building.It was less than pension fund STRS Ohio’s $1.1 billion asking price, but the first $1 billion-plus purchase of an office tower by a real estate company since before the pandemic.

(Alphabet occupied the St.John’s Terminal building before it bought it for $2 billion in 2022).RXR’s price was also much less than the $1.3 billion that STRS hoped for...