Real Estate

Extell’s Fifth Avenue tower may have to build around mystery buyer’s holdout

When Extell Development Corp. builds a long-awaited supertall office-and-retail tower at the corner of Fifth Avenue and 47th Street, one piece will be conspicuously missing from the 1,100 foot-tall giant — the actual corner of Fifth Avenue and 47th Street.

A mysterious Korean company swooped onto the site late last year and snatched up 576 Fifth Ave., the last parcel that Extell chief Gary Barnett needed to create a block-long façade on the avenue that he spent 10 years trying to assemble. He owns the rest of the blockfront — as well as vacant land and buildings along West 46th and 47th streets.

But his massive project will have a large missing tooth at its northern corner.

Now, questions are being raised about the timing and purpose of the Korean company’s purchase.

Barnett recently filed plans with the Department of Buildings for options for two different towers at the site: One option, a supertall, would be mainly for offices and would have 1.5 million square feet of floor space. The other option, which would be smaller, would stand  only 476 feet in the event Extell can’t land an anchor office tenant to build the jumbo.

47th and Fifth Avenue in New York City
Gary Barnett’s Extell has cleared a spot at the corner of Fifth Avenue and 47th Street for a planned supertall building. But a mysterious South Korean company has swooped in that could throw a wrench in things.
Gordon Donovan

Both designs are wending their way through the city’s Uniform Land Use Review Procedure, hoping to earn a significant size bonus in exchange for upgrades that Extell would make to the nearby East 53rd Street and Fifth Avenue subway station. Such deals are allowed under new East Midtown zoning rules.

Among other proposed improvements, Extell would make the deep E, M and F station   accessible to disabled people for the first time.

But Barnett must also deal with the challenge of designing and constructing his new tower around 576 Fifth Ave., which opened in 1907.  

576 Fifth Avenue in 2019
A building on the corner of 47th Street and Fifth Avenue, seen in a 2019 file photo, is all that stands between Extell’s Gary Barnett getting a clear block for a planned supertall building. Many of the buildings surrounding it have been cleared to make way for the supertall, but it remains.
Helayne Seidman

The Korean company swooped in last fall and bought the 1907-vintage, 12-story location for $101 million — or $1,285 per square foot.

By comparison, the average fourth-quarter sale price for Manhattan office buildings was $954.

The purchase price was below the $113 million asking price posted in October 2020, but much higher than other offers submitted in the blind-bidding process, according to a source.

Sources said those offers last summer, including one from Extell, were in the $60 million to $80 million range.

The pricier sale to the Korean group apparently took Barnett by surprise.

576 Fifth Ave. in New York
The same building on the corner of 47th Street and Fifth Avenue in a picture taken last week. It’s all that remains on an otherwise-cleared site for Gary Barnett’s Extell to build a supertall building; the mysterious buyer’s snapping up of the building might mean Extell could have to build around the site.

The buyer’s identity was shielded behind an LLC. However, The Post has learned that it’s a South Korean holding company, Sae-A Trading Co. Ltd.

The global firm manufactures and sells apparel through several subsidiaries. It also owns Southern California golf courses.

The head of Sae-A’s US operations, Chloe Saiyon Kim, did not respond to e-mails seeking comment on her firm’s plans for 576 Fifth Ave. Barnett didn’t respond to  requests for comment, either.

Observers who didn’t want to be named wondered why Sae-A paid more than it needed to for a building faced with difficult years ahead.

SAE-A Trading building in Haiti
A mysterious Korean holding company is behind an LLC that bought the building on 47th Street and Fifth Avenue. The company, Sae-A Trading Co. Ltd., has operations around the world, including this one in Haiti.
SAE-A

“Whatever they do, it’s going to be surrounded by Barnett’s project on three sides, with all the noise, demolition and debris that will bring,” one source said.

“Also, although there are no rules, it’s considered bad form to step into another company’s assemblage just when it’s nearly complete.”

Another possibility raised by a different insider is that Sae-A was aware of Barnett’s almost-complete assemblage and bought 576 Fifth in hopes of selling it to him for a higher price. 

Extell chief Gary Barnett
Extell’s Gary Barnett has assembled a block-long parcel over the past 10 years where he wants to build a supertall tower; only one thing stands in his way: a building at 576 Fifth Avenue that has been purchased by a Korean firm. Now, Barnett is submitting plans that build around the Fifth Avenue structure.
Patrick McMullan via Getty Image

However, that source said, “They already paid $101 million. What’s the upside if they sold it for a few million more?” In any event, there’s no indication that Extell and Sae-A have had any contact.  

Sae-A is said by sources to be highly secretive with a byzantine organizational chart.

SAE-A logo
The logo of the Korean company, SAE-A, that snapped up a key corner of Extell’s planned development.

Despite having 60,000 worldwide employees at its various subsidiaries, it’s stayed below the radar in New York.

Its only public-record mention was a lawsuit filed against it in December 2020 in Manhattan Supreme Court by a former vice-president, Victoria Kim (no relation to Chloe Kim), who claimed she was fired for not being a “traditional Korean.”

She claimed she was subject to age and gender discrimination and victimized by a “hostile, intolerable workplace based on gender harassment.” Sae-A denied the charges last month. The case is pending.

Products You May Like

Articles You May Like

Your House Flipping & Rental Property Profits Are About to Change
Buying property in US cities cheaper than renting despite record home prices
Listing price plummets on $29M NYC building being offered for crypto
While you’re all distracted by Zelensky and Ukraine | Redacted with Clayton Morris
Horrifying NYC rental market fuels hourlong lines to see tiny apartment

Leave a Reply

Your email address will not be published.