{"id":421593,"date":"2025-12-03T10:26:04","date_gmt":"2025-12-03T10:26:04","guid":{"rendered":"https:\/\/www.europesays.com\/us\/421593\/"},"modified":"2025-12-03T10:26:04","modified_gmt":"2025-12-03T10:26:04","slug":"empire-state-realty-trust-to-buy-scholastics-soho-hq-for-386m","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/us\/421593\/","title":{"rendered":"Empire State Realty Trust To Buy Scholastic’s SoHo HQ For $386M"},"content":{"rendered":"

Empire State Realty Trust<\/a>\u00a0is scooping up the Scholastic Building in an all-cash sale-leaseback deal, the two companies\u00a0announced Tuesday.\u00a0<\/p>\n

The REIT has agreed to pay $386M for the\u00a0property\u00a0at 555-557 Broadway in SoHo, between Spring and Prince streets. The transaction is expected to close this month.<\/p>\n

\"Placeholder\"\/<\/p>\n

\n The Scholastic Building at 555 Broadway\n <\/p>\n

Under the deal, Scholastic will enter a 15-year lease for 222K SF of the building\u2019s 368K SF of office space. The lease has two 10-year extension options, according to Scholastic<\/a>.<\/p>\n

The 28K SF retail space is fully leased to Sephora<\/a> and Capital One<\/a>, with a weighted average lease term of approximately eight years.<\/p>\n

That brings the property\u2019s occupancy to 70%, with a three-floor block of over 110K SF of office space available.<\/p>\n

The book publisher paid $255M for 555 Broadway<\/a>, which serves as its U.S. headquarters, in 2014. Prior to that, it had been a tenant at the building since 1992 and owned the adjacent building at 557 Broadway since 2010.<\/p>\n

But\u00a0Scholastic is offloading the property as part of its turnaround efforts.<\/p>\n

The sale is estimated to generate $327M in proceeds, which will be used to reduce the company\u2019s debt and\u00a0buy back stock, according to the company.\u00a0<\/p>\n

As landlord, ESRT will take over maintenance expenses and capital investments, which cost Scholastic $7.3M in fiscal year 2025. It will also take over rent collections from the other tenants, which earned Scholastic $11.2M in income this year.<\/p>\n

Despite shrinking its footprint in the building and reducing operating costs, the new lease is estimated to add an annual expense of $11.2M, Scholastic said.<\/p>\n

“Today’s announcement reflects meaningful momentum for Scholastic as we unlock the value of our owned real estate and focus on accelerating long-term, profitable growth and shareholder value creation,” Scholastic President and CEO Peter Warwick said in a statement.<\/p>\n

Newmark<\/a>\u2019s Adam Spies<\/a>, Josh King\u00a0and Avery Silverstein<\/a> represented Scholastic in the sale.<\/p>\n

The deal adds to a string of big-ticket Manhattan office sales that have closed this year. Roughly $4.9B of properties traded in the third quarter, up 191% from the second quarter and 54% from a year prior, according to Avison Young<\/a>.<\/p>\n

That number was bolstered by RXR<\/a> and Elliot Investment Management\u2019s nearly $1.1B purchase of 590 Madison Ave. and Norges Bank Investment Management<\/a> and Beacon Capital Partners<\/a>‘ $572.3M acquisition of 1177 Sixth Ave.<\/p>\n

Avison Young\u00a0said such deals spur market confidence, resulting in more closings as the year comes to an end. It\u00a0estimated that the overall dollar volume<\/a> for Manhattan CRE sales in\u00a02025 will work out at $12.3B, up 9% from last year.<\/p>\n

In addition to the Scholastic Building, the publisher announced it is selling its primary distribution facility in Jefferson City,\u00a0Mo., to Fortress Investment Group<\/a> for $95M. The deal will generate $74M in proceeds for the firm.<\/p>\n

There, Scholastic will\u00a0commit to a 20-year triple-net lease with two 10-year lease extensions. Annual rent will cost the company $7.6M.<\/p>\n","protected":false},"excerpt":{"rendered":"Empire State Realty Trust\u00a0is scooping up the Scholastic Building in an all-cash sale-leaseback deal, the two companies\u00a0announced Tuesday.\u00a0…\n","protected":false},"author":3,"featured_media":421594,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5122],"tags":[70462,5229,127981,100529,170038,196837,196838,405,403,53974,5226,5225,5228,5227,196840,196839,140339,23789,67,586,132,5230,68,2969],"class_list":{"0":"post-421593","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-new-york","8":"tag-adam-spies","9":"tag-america","10":"tag-avery-silverstein","11":"tag-capital-one","12":"tag-empire-state-realty-trust","13":"tag-fortress-investment-group","14":"tag-josh-king","15":"tag-new-york","16":"tag-new-york-city","17":"tag-newmark","18":"tag-newyork","19":"tag-newyorkcity","20":"tag-ny","21":"tag-nyc","22":"tag-scholastic","23":"tag-scholastic-building","24":"tag-sephora","25":"tag-soho","26":"tag-united-states","27":"tag-united-states-of-america","28":"tag-unitedstates","29":"tag-unitedstatesofamerica","30":"tag-us","31":"tag-usa"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@us\/115655160279333557","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/421593","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=421593"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/421593\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/421594"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=421593"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=421593"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=421593"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}