Nuveen, Union & Clarion Seal Deal on 636 Avenue of the Americas

The entire property at 636 Avenue of the Americas has been sold, with both the retail and office portions changing hands. Nuveen Real Estate and Union Investment sold the retail space, while Clarion Partners sold the office space above. The buyer, a group associated with the Hotel and Gaming Trades Council and the Hotel Association of New York City, acquired both sections for approximately $70 million. The retail space covers 18,000 square feet, and the office space spans 70,000 square feet, with each portion selling for around $35 million.

Buyer’s Plans for the Property

The buyer is a union group representing hotel and gaming workers, which plans to use the retail and office spaces for medical facilities. The group has been expanding its presence in New York City, with health centers already operating in Brooklyn, Harlem, Midtown Manhattan, and Queens. The purchase of 636 Avenue of the Americas aligns with their ongoing efforts to support their members with healthcare services across the city.

Transaction Details and Market Context

CBRE brokers Daniel Kaplan, Doug Middleton, Jack Stillwagon, and Justin Arzi facilitated the transaction, which closed on September 13. The office portion had been vacant, while the retail space was previously leased by CVS, which closed in 2022. The sale marks a notable achievement in a challenging investment environment, according to Adam Irányi, head of investment management global at Union Investment.

Nuveen and Union Investment acquired the retail portion of 636 Avenue of the Americas in a 2016 joint venture that included three other retail properties. Nuveen, formerly known as TIAA-CREF, had initially purchased the site in 2014 for $42 million. The building’s sale is part of a broader trend of tenants purchasing their buildings, including notable recent acquisitions by companies like Prada, Kering, and FedEx.

Broader Trend of Tenant Purchases

The sale of 636 Avenue of the Americas follows a growing trend of companies buying the buildings they occupy. Recent high-profile examples include Prada purchasing its Fifth Avenue building for $425 million and Kering acquiring another on the same street for $963 million. FedEx also joined the trend, buying Sunset Industrial Park for $248 million earlier this year.