Real Estate Investor Joseph Sitt Bids More Than $2.1 Billion for Empire State Building


A New York real-estate investor made a bid on Thursday to buy the Empire State Building for more than $2.1 billion, the third unsolicited offer for the landmark property over the past several days.

The most recent offer is from Thor Equities, according to Jason Meister, a real estate broker at Avison Young, who submitted the proposal to the Malkin family. His offer tops the rival bids, Mr. Meister said.

The Malkins, the New York real-estate family that controls the Empire State Building, is seeking to sell the skyscraper and 18 other properties as part of a real estate investment trust. The family recently received approval from the stakeholders in the building to go ahead with that process.

Thor Equities is run by Joseph Sitt, a large New York landlord who owns many office and retail properties in Manhattan, as well as others in Mexico City and Europe.

Mr. Sitt declined to comment, but Mr. Meister described the bid as “north of $2.1 billion.”

In a securities filing Wednesday, a day before Mr. Sitt’s bid, the Malkins disclosed that they had received two unsolicited offers for the skyscraper, one for $2 billion and one for $2.1 billion. The building has been appraised at $2.5 billion, according to a previous securities filing.

The Malkins said in Wednesday’s filing that they are reviewing the offers. A spokeswoman said they had no additional comment.

The sudden flurry of bids comes shortly after the Malkins had won a hard-fought battle to convince stakeholders to back their plan for an initial public offering. The IPO looks to raise up to $1 billion, which would make it the second-largest IPO for a U.S.-based REIT.

The bids on the property started to stream in after the Malkins had received the necessary approval from 80% of the shares held by roughly 2,800 stakeholders.

The $2 billion offer came last week from a company run by Rubin Schron, a New York City real-estate investor who owns part of downtown Manhattan’s Woolworth building. That bid was sent in a letter last week by attorney Stephen Meister, who is also the father of Jason Meister, the broker handling Mr. Sitt’s bid.

The Malkins filing did not disclose the identity of the group that made the second, $2.1 billion offer. But people familiar with the process have said the bid was from a consortium that included investors Philip Pilevsky and Joseph Tabak. They could not be reached for comment.

Since the stakeholders have already approved the plan to include the Empire State Building as part of a REIT, it’s not clear what the effect of these offers will be.

Stephen Meister, the attorney, is representing some of the Empire State Building stakeholders who opposed that plan, argued in New York court that a buyout provision in the IPO plan is illegal. The court ruled against him, but Mr. Meister is appealing that decision and is hoping that, if he prevails, he can force a new vote and give stakeholders the opportunity to consider the unsolicited offer.

Stephen Meister said Mr. Schron’s $2 billion all-cash offer is more attractive, even though the Empire State Building was appraised at $2.5 billion. He said the Malkins make “no assurances” that “the REIT shares will be trading … anywhere near that value.”

Some attorneys say that the Malkins have a fiduciary duty to consider these offers.

“The Malkins will need to consider carefully the offers for the Empire State Building,” said Tom Murphy, head of capital markets for the international law firm McDermott Will & Emery. “It doesn’t necessarily mean they need to accept an offer but to meet their fiduciary duties, they can’t dismiss them out of hand.”

In a securities filing on Wednesday, the Malkins indicted they were already reviewing the first two offers. “We consider all matters, including unsolicited offers, consistent with our fiduciary duties, to form a judgment on what action is appropriate,” the filing said.