Tony Malkin’s Empire State Realty Trust has entered into a contract to purchase the Scholastic Building in Soho for $386 million, according to an announcement made by the company on Tuesday. The property, located at 555-557 Broadway, is owned by publisher Scholastic, which occupies most of the building’s space—368,000 square feet of office and 28,000 square feet of retail along a prominent shopping corridor.
Malkin noted that the appeal of the property lies in its current revenue stream and potential for value enhancement through marketing “three uniquely large floors in a more than 110,000 square feet block.” Scholastic listed the building for sale earlier this year with plans for a sale-leaseback arrangement. The public company intends to use proceeds from the transaction to address “capital allocation priorities,” including debt reduction and share repurchases. Scholastic acquired the building in 2014 for $255 million from ISE America.
In another real estate move, William Macklowe Company has purchased a $46 million distressed loan note on a 10-story office building at 291 Broadway from Flagstar Bank. This follows Flagstar’s foreclosure lawsuit against owner Sutton Management due to missed payments. The 129,000-square-foot property could be considered for residential conversion if Macklowe forecloses or obtains ownership through other means.
Meanwhile, New York’s casino industry is approaching significant changes as the state Gaming Facility Location Board recommended licenses for three proposals: Steve Cohen’s Metropolitan Park, Bally’s Golf Links at Ferry Point, and Resorts World’s expansion at Queens Aqueduct. License terms are set based on investment levels: Metropolitan Park and Resorts World would receive 20-year licenses; Bally’s would get a 15-year license. These proposals include hotels and entertainment venues aimed at promoting economic activity and business development. Final decisions by the Gaming Commission are expected by month-end.
Rapper Nas, who is partnered with Resorts World, commented on the recommendations: “It’s a great day in New York City.”
The article also addresses ongoing revelations about Jeffrey Epstein’s connections to real estate figures. In 2018, Epstein claimed he had “helped put them in biz,” referring to Core Club founders Jennie and Dangene Enterprise—a claim denied by a spokesperson as “baseless.” Released emails indicate some personal connection between Epstein and Jennie Enterprise but no business involvement.
The Core Club serves high-profile clients in real estate and finance such as RFR’s Aby Rosen and Blackstone CEO Stephen Schwarzman. A spokesperson stated: “[I]n no way, shape, or form did this individual play any business development role in the company, and any suggestion to the contrary is baseless.”
Documents released by Congress show that Epstein read The Real Deal articles related to Palm Beach development deals; these were referenced in his email correspondence from June 2019.
