THE American Stock Exchange's Lower Manhattan headquarters could sell for as much as US$200 million after the exchange agreed to be purchased by NYSE Euronext for US$260 million, said New York real estate broker Studley Inc.
"There's not a whole lot of precedents for this type of land deal down here, but it could go for anywhere from US$150 million to US$200 million," David Endelman, an assistant director in Studley's capital transactions group, told Bloomberg News.
The 165-year-old Amex plans to sell the 181,000-square-foot (16,800-square-meter) building at 86 Trinity Place, which it has occupied since 1921, as well as the adjacent 89,000-square-foot building at 22 Thames Street, Chief Executive Officer Neal Wolkoff said.
NYSE Euronext, owner of seven securities markets in Europe and the United States, including the New York Stock Exchange, said on Thursday it is buying the Amex to capture a bigger share of the fast-growing options and fund-trading businesses. Members of the Amex will receive shares of NYSE Euronext as well as proceeds from the sale of the Amex buildings, the exchanges said.
Wolkoff has declined to estimate how much the Amex buildings could fetch.
"The brokerage community seems to indicate that the commercial market, particularly in the World Trade Center vicinity, is very active and actually growing, not declining," Wolkoff said on Friday in an interview on Bloomberg Television. "So I think we should be able to accomplish what we want in a good period of time."
The sale of the Amex buildings may be complicated by the fact that 86 Trinity Place has had National Historic Landmark status since 1978, which could make it more difficult to redevelop the site, said Dan Fasulo, managing director for research at New York-based Real Capital Analytics Inc.
"I was walking by it a couple days ago, and I thought to myself, 'What the hell can you do with this building'?" Fasulo said. "It's a question mark for me."
Fasulo said that any potential buyer for the Amex buildings is going to be interested in the size of the air rights and what limits there will be on construction. "The investors who are going to be interested in this type of asset are going to have redevelopment thoughts in their heads," he said.
A new building on part of the site could include office space with condominium apartments on the top floors, and extensive retail space at street level, said Endelman.
"Confidence in downtown's retail is surging," he said, citing the January 4 decision by Sydney-based Westfield Group, the world's biggest mall owner, to develop a US$1.45 billion retail shopping complex at the former World Trade Center.