111 8th Avenue, one of the most important telecom hubs in Manhattan, is up for sale. The enormous building houses major data center operations for Digital Realty Trust, Equinix, Telx and many other providers and networks, as well as 500,000 square feet of office space for Google.
The 2.9 million square foot building, which occupies the entire city block between 15th & 16th Streets from Eighth to Ninth Avenues, has been placed for sale by an ownership group including Taconic Investment Partners, the New York State Common Retirement Fund and the German investment group Jamestown. The ownership group hopes to do a 90 percent recapitalization, leaving it with a minority stake, according to the New York Post.
111 Eighth Avenue is among the world’s most wired buildings. It was originally built as the Port Authority Commerce Building in 1932, and was redeveloped for telecom use by Taconic in the late 90s. Manhattan real estate watchers speculate that due the building’s size and strategic importance, a sale could fetch as much as $2 billion. The offering is being closely watched as a barometer of the Manhattan real estate market.
“Investors, brokers and analysts are divided over whether the listing will hark back to the era of billion-dollar transactions or represent an outbreak of irrational exuberance only two years after the financial crisis snuffed out the greatest real estate boom of all time,” the New York Times writes. “Whatever happens, experts say, the sale may amount to a verdict on the vitality of the New York market, or at least the appetite for big deals.”