BentallGreenOak has returned the keys to a Midtown East office tower through a deed of foreclosure.
Lender New York Life Real Estate Investors took over the 500,000-square-foot Class A building at 757 Third Avenue, according to property records. The transfer ends BGO’s nearly decade-long ownership of the 1960s-era tower, which appears to have faced occupancy issues amid a sluggish post-pandemic leasing environment.
New York Life estimated that the property was valued at approximately $150 million at the time of the transfer. Pincus Co reported, citing industry sources. That’s less than half what the Canadian investment firm paid in 2015, when it bought the property for $360 million from Aby Rosen’s RFR Holding. New York Life provided a $205 million, 15-year loan for the purchase. The building was 95 percent rented at the time.
In 2017, Bentall Kennedy attempted to sell a 49 percent stake in the company 757 Third Avenue and two San Francisco properties hoping to raise $1 billion. But apparently that never happened. Bentall Kennedy merged with GreenOak Real Estate in 2023 to become BentallGreenOak.
The 26-story building, two blocks west of the United Nations, counts Wolfe Research, Berkley Insurance and Grant Thornton among its largest tenants. Berkley extended its 60,000-square-foot lease in 2022, but overall occupancy remained under pressure as Midtown East tenants lost space or moved to newer buildings after the pandemic. According to CoStar data, the building’s occupancy rate has dropped to about 74 percent.
Last year, reinsurance broker BMS Group expanded its footprint to 13,000 square feet and software company Endava occupied 7,000 square feet in the building, according to Commercial observerwho first reported news of the deed-in-place. The Consulate General of Portugal also announced that it would move into a pre-built 700 square meter space on the 17th floor.
The transfer adds to a growing list of older Midtown assets that are returning to lenders or sold at a discount as debt maturities clash with higher interest rates and lower office values.
BGO and New York Life did not immediately respond to requests for comment.
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