Invest $3 Million Now to Acquire a $20 Million Surgical Center

438 W 51st Street

The owner rebuilt this building and spent millions converting it into a medical office building and surgery center. A recent price reduction is designed to facilitate a quick closing.

A $20,000,000 purchase price yields a 6.04% cap rate on the in-place NOI, with substantial upside from the available vacant space.

Financing: Valley is the lender. The current loan totals $17,600,000 at 5.50% interest, maturing in May 2043 with a 5-year adjustment cycle. The next adjustment is reportedly 2028. The loan appears to be assumable by a qualified purchaser, subject to lender approval.

The surgery center and a dental tenant have tenancy restrictions within the building.

Leasing terms: Asking rent is $55 per SF plus electric, with a pro forma based on $50.00 per SF. This is a new medical building; additional details follow:

• Lower level: Built-out dental suite of 1,761 RSF.
• Ground floor: 5,182 RSF. (Currently a physical therapy group is evaluating the space.)
• 2nd floor: 5,898 RSF total; back portion 4,010 RSF; front portion 1,888 RSF. Plan attached.
• 3rd floor: Back portion remaining 1,747 RSF; the other portion has recently been leased to a dentist.

Total combined Ground and 2nd Floor: 11,080 RSF.

• New construction – handicap accessible, with new elevators and Article 28 approved building.
• Surgery center on-site unaffiliated with any hospitals, focused on ortho, spine & pain-related surgeries.
• Seeking $55 per SF plus electric (separately metered).
• Landlord will deliver a white box.
• Tenant will build out its space to its specifications.
• In lieu of OPEX, there will be 3.0% annual rent escalations and a $5 per SF rent increase in year 6.
• Nine (9) months of free rent is being offered in lieu of TI.
• Term: 10 years or more.

• Listing Type: Office
• Listing Price: $22,000,000
• Building Lot Size: 50,000 SF
• Number of Operatories: 15
• Listing Location: New York, NY