A decade ago, Deutsche Bank paid nearly $500 million for the 1960s-era office building at 222 Broadway. Now, after the departure of Bank of America and WeWork’s bankruptcy, the financial institution is prepared to take a massive loss on the building.
Deutsche’s asset management arm is shopping the 31-story building for sale, eyeing a price of somewhere between $150 million and $200 million, The Real Deal has learned.
The office portion of the 780,000-square-foot building is only 31-percent occupied after Bank of America, which had leased the majority of the office space, let its lease expire. WeWork also leased a large portion of the space, and the location is part of the company’s bankruptcy. (Though, not one of the 70 locations the co-working company immediately rejected last week.)
Deutsche Wealth Services is pitching the building as a “blank canvas opportunity for an investor to either re-lease the building as office, or convert some or all of the building to residential,” according to marketing materials from Newmark, where a team led by Adam Spies and Josh King is leading the sales effort.
The tower floors are particularly well suited for a conversion, given their efficient layouts and access to light and air, according to the offering memo.
A representative for DWS declined to comment.
The bank bought the property in 2014 from Beacon Capital and L&L Holding Company.
While the offices are virtually empty, the retail space is almost entirely leased and generates more than $60 million in revenue, with tenants that include Zara and JP Morgan, according to the offering memo. Still, the property is facing a number of challenges that are making things difficult in the office market, including hybrid work, rising interest rates and WeWork’s bankruptcy.
Another former WeWork landlord, Vanbarton Group, is working to convert a rejected space in Midtown into residences, which is something owners are surely giving consideration to as they prepare to take back these spaces.