The Flatiron Building for Sale

Wanted to buy iconic New York skyscraper for 2 billion – unable to pay deposit. The 120-year-long and rich history of “The Flatiron Building” in New York has taken another turn.

UNDER CONSTANT IMPROVEMENT: Scaffolding has surrounded the building for a number of years, but according to a former owner, the building requires improvements worth well over one billion kroner in order to be able to be used and operated as normal.

The building was – as New York’s first skyscraper – erected in 1902. The skyscraper is well known worldwide due to its special iron shape, where it is shaped into a point at the front end.

At its narrowest, “The Flatiron Building” measures just 190 centimeters in width.

The iconic high-rise building is located right next to Madison Square Park on 23rd Street in Manhattan.

The current owners, Sorgente Group, GFP Real Estate, ABS Real Estate Partners and Nathan Silverstein, were never able to agree on what to do with the interior of the building. They have already spent large sums on the exterior, but the inside is almost completely bare.

The building has been empty after the company Macmillian Publishers moved out in 2019. The building has been home to restaurants, bars and office space throughout. In addition, there is a penthouse on the top floor – which was added several years after the building was first used.
Foreclosed during “The Great Depression”

The internal squabbling between the current owners led to a judge in Manhattan recently deciding that the skyscraper had to change owners. This via a forced auction.

The same thing also happened 90 years ago, in 1933, in the middle of “The Great Depression” – the years when the economy collapsed between the world wars.

According to Bloomberg, the skyscraper was then sold for 100,000 dollars, which is just over 1 million kroner at today’s exchange rates.

The winning bid this time ended up at just under NOK 2 billion, after a fierce bidding round. Before the auction, the building was valued at approximately NOK 500 million.

It was the American investor Jacob Garlick’s fund, the Abraham Trust, which outbid the competitors with its winning bid of 190 million dollars, or just under 2 billion kroner at today’s exchange rate.

– It has been a lifelong dream of mine to own this building. “I’ve worked every day so far in my life to put myself in this position,” Garlick told the NY1 website shortly after winning the auction.

Now, however, a takeover of the 22-storey building appears to be a long way off, as Garlick has been unable to pay the 10 per cent of the total purchase price he was due as a deposit.

Thus, there is now complete confusion about what happens next with the skyscraper.

Broker at the giant Douglas Elliman, Tom Brady, watched the auction.

– I could not miss this historic moment. The winning bid probably ended up a little higher than I thought, but the building is iconic, says Brady to NY1.

The building’s former owner, Jeffery Gural, did not hide that he wanted the skyscraper, but simply believed that it was not worth the price the auction was aiming for.

– I’m actually a bit shocked, to be honest. I never thought anyone would pay that much for it. It’s a lovely building, but it needs well over $100 million worth of upgrades. It’s basically empty inside, Gural said, according to the same website.

But not only that Garlick and his fund are unable to meet the deposit requirement, this has set off a domino effect. Nathan Silverstein, one of those who already own part of the building, originally wanted to buy 100 percent.

His final bid was ultimately beaten by Garlick, and by just half a million dollars. Silverstein’s goal was to convert the building into a hotel.

As Garlick does not meet the deposit requirement, Silverstein has been given the opportunity to buy the building at his last bid. According to the website archinect, he has now declined the opportunity to do this.

As a result, a new auction must be held later. The time frame for this is currently unknown.

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