The 25-story building at 5 Hanover Square in Manhattan sold this month as Savanna Fund II REIT disposed of the property for $104 million, a pricepoint double to the amount it paid for the property just three years ago. Savanna obtained control of the building after it purchased the mortgage on the property during the economic downturn. CIM Group, a full service real estate investor, picked up the building, making it the second acquisition this summer for CIM in the Financial District. The real estate practice group of Hunton & Williams advised Savanna in the transaction.
"The market really turned around, [Savanna's] strategy of buying notes was spot on," said Robert Knakal, chairman of the brokerage company Massey Knakal Realty Services, who sold 5 Hanover Square's mortgage to Savanna on behalf of Capital One Bank. "They've done extraordinarily well."
"Savanna has made a substantial investment in downtown Manhattan, including 5 Hanover, which is an investment very typical of Savanna's focus over the last two years," Carl Schwartz, co-chair of Hunton & Williams' real estate practice, told Commercial Property Executive. "Savanna completed its leasing and capital improvement programs resulting in a stabilized asset both from a capital and leasing perspective."
5 Hanover Square is located on the northern side of Hanover Square between Pearl and Beaver Streets in Manhattan's Financial District. Savanna acquired the building with an occupancy rate of 70%, and through a marketing and leasing program as well as a $7 million investment managed to increase the occupancy rate to 96%, according to an INVEZZ article. The glazed brick masonry building sets back on the 9th and 20th floors, creating three separate floor plate configurations. The building's renovated lobby features Italian marble, Japanese wood, renovated elevator cabs, modern security equipment, and an upgraded front desk.
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