BXP Selling 7 Times Square Ground Lease – Commercial Observer
In a test of the appetite for Times Square offices, BXP has hired Will Silverman and Gary Phillips at Eastdil Secured to market the 7 Times Square ground lease, Commercial Observer has learned.
BXP expects to ask from $700 million to $750 million. A source close to the deal said the price will be just north of $700 million.
That price is just over the $684 million Norges Bank Investment Management paid in 2013 for a 45 percent stake in the primarily Class A office property, which then revalued the building at $1.52 billion. Bids for the new sale are due soon, sources said.
The 1.2 million square-foot tower was developed in 2004 as part of the overall Times Square redevelopment. Also known as Times Square Tower, it operates on a 99-year ground lease that commenced on April 18, 1990, and includes an option to purchase the site from the city.
The sale of the lease will be a test of the local market that is filled with tourists, as its neighbor at 5 Times Square is already undergoing a conversion to residential units by RXR, while SL Green Realty is considering changing 1515 Broadway into a hotel.
The news of the marketing was first reported by Green Street’s Real Estate Alert, which noted the 91 percent occupied tower has roughly 100,000 square feet available at the most valuable top floors. Green Street’s Sale Comps Database said only nine single-property office buildings have traded for at least $700 million since 2020. Two of those deals were after 2022, including the $1.08 billion sale of 590 Madison Avenue to RXR and Elliott Investment Management and the purchase by SL Green of Park Avenue Tower at 65 East 55th Street for $720 million, with both marketed by Eastdil.
Designed by David Childs of Skidmore Owings & Merrill, 7 Times Square was developed by the company then known as Boston Properties (now BXP) on a full block bounded by West 41st and West 42nd streets, Broadway and Seventh Avenue. It was skillfully constructed, as it is completely surrounded by subway trains and includes a major entrance to the underground complex.
Electronic billboards cover much of the first four stories, with an office sky lobby on the fifth floor. Amenities include conference rooms, a client lounge and a café. There is also an opportunity to increase sign revenue with digitization, Real Estate Alert reported. At 724 feet high with 47 stories, it also overlooks One Times Square — known as the Ball Drop Tower — thus providing views of New Year’s Eve festivities.
Tenants at 7 Times Square include the newly signed data platform Snowflake with 83,000 square feet, KnitWell Group with 246,000 square feet — which still has an Ann Taylor Loft store in the retail base — along with holding company GSI Exim America and law firms Friedman Kaplan and Norris McLaughlin.
As part of a series of strategic dispositions in 2025 and 2026, BXP has already closed sales of over $1.1 billion, including land parcels in Boston, San Francisco and Washington, D.C., residential properties in Cambridge, Mass., and Reston, Va., and non-core office and life sciences properties in Needham, Mass., and South San Francisco.
In March, the company said it expected to raise $1.9 billion from such sales. “Our clearly articulated business plan to lease space and improve occupancy, sell select assets, and reinvest in premier workplace development will allow BXP to grow [funds from operations per share], deleverage, and improve portfolio quality over time,” said Owen Thomas, chairman and CEO of BXP. “We have made very strong progress executing all aspects of our plan over the last six months.”
In May, the firm agreed to sell the Sumner Square complex in Washington, D.C., for $63 million but will recognize losses there totaling $35 million.
In New York, BXP is also developing the new 343 Madison Avenue, which is now 56 percent leased with insurance firm C.V. Starr taking 275,000 square feet and law firm McDermott Will & Schulte in another 150,000 square feet.
Silverman declined comment on the marketing of 7 Times Square, while BXP and Norges did not immediately return requests for comment.
