Boston Properties (BXP) has hired Eastdil Secured brokers Will Silverman and Gary Phillips to sell the ground lease on 7 Times Square, one of Manhattan's most prominent office towers. BXP expects asking prices between $700 million and $750 million for the asset.
The 52-story building occupies prime real estate in the heart of Midtown Manhattan's most valuable commercial district. Ground leases in New York City command significant value because the underlying land ownership generates perpetual revenue streams for the lessor. Buyers of this lease would gain operational control of the building while the original landowner retains ownership of the underlying parcel.
This transaction tests investor appetite for Times Square office properties at a time when Midtown Manhattan's office market faces headwinds. Hybrid work arrangements and economic uncertainty have pressured Class A office valuations across Manhattan. The $700 million to $750 million asking price reflects BXP's confidence in the location's long-term viability despite near-term market softness.
For institutional investors, REITs, and alternative asset managers, ground lease purchases offer attractive features. They provide stable, long-term income with inflation-embedded rent escalations. The security of a ground lease on a premier Manhattan location appeals to capital seeking yield in trophy assets. For tenants leasing space in the building, this transaction carries minimal impact, though new ownership could affect building operations and capital investment strategies.
BXP's decision to market the ground lease now suggests confidence that buyers remain active in trophy Manhattan office deals. The brokerage team at Eastdil Secured will target institutional investors, foreign capital, and domestic real estate funds seeking Midtown exposure through ground lease investments. Pricing near $700 million values the asset on its cash flow generation rather than speculative tenant demand recovery.
The sale represents a partial liquidity event for B