American Strategic Investment Co. Sets Closing Date for 9 Times Square Sale

Rhea-AI Summary

American Strategic Investment Co. (NYSE: NYC) has announced December 19, 2024, as the closing date for the sale of its 9 Times Square Midtown Manhattan property for $63.5 million. The buyer has provided a $7 million non-refundable deposit. The company previously secured a mortgage loan amendment extending the maturity date to January 2025 to facilitate the sale. ASIC expects to generate approximately $13.5 million in net proceeds, which it plans to use for strengthening its balance sheet and supporting its expanded asset acquisition and diversification strategy.

Positive

• Secured $7 million non-refundable deposit from buyer
• Expected to generate $13.5 million in net proceeds from sale
• Successfully extended mortgage loan maturity to January 2025

Negative

• Divesting major Manhattan property asset

Insights

Financial Analyst

The sale of 9 Times Square represents a significant transaction for American Strategic Investment Co., with several key financial implications. The $63.5 million contract price and secured $7 million non-refundable deposit demonstrate strong buyer commitment. The expected $13.5 million in net proceeds, while modest compared to the total sale price, provides important liquidity for balance sheet improvement and strategic initiatives.

The mortgage loan amendment extending to January 2025 was a strategic move to facilitate this sale, showing proactive debt management. However, the significant gap between gross sale price and net proceeds ($50 million difference) suggests substantial debt obligations or transaction costs. This transaction appears to be part of a broader strategic pivot, potentially signaling a shift in the company's real estate portfolio strategy and capital allocation approach.

Real Estate Market Analyst

The Times Square property sale reflects current market dynamics in Manhattan's commercial real estate sector. The transaction timing, with a December 2024 closing date and substantial non-refundable deposit, indicates buyer confidence despite challenging market conditions. The property's location in Midtown Manhattan, traditionally a prime commercial district, likely helped secure this deal despite broader market uncertainties.

The extended mortgage maturity arrangement demonstrates the complex nature of commercial real estate transactions in the current environment, where lender flexibility is important for deal completion. The company's strategy to expand and diversify its asset portfolio suggests a tactical response to evolving market conditions and opportunities in different real estate segments.

- Non-Refundable Deposit of $7.0 Million Secured and Expect to Generate Approximately $13.5 Million in Net Proceeds at Closing -

NEW YORK--(BUSINESS WIRE)-- American Strategic Investment Co. (NYSE: NYC) (“ASIC” or the “Company”) announced today that December 19, 2024, has been set as the closing date for the sale of its 9 Times Square Midtown Manhattan property (“9 Times Square”) for a contract sales price of $63.5 million. Additionally, in connection with this transaction, the buyer has paid a $7 million non-refundable deposit with respect to the sales price.

The Company previously announced that it had secured an amendment of the mortgage loan on 9 Times Square, which extended the maturity date of such loan up to January 2025, subject to certain conditions, to facilitate the proposed sale of 9 Times Square.

Michael Anderson, Chief Executive Officer of ASIC stated, “We look forward to closing this transaction. We expect to utilize the approximately $13.5 million in net proceeds from this sale to strengthen our balance sheet and support our pursuit of an expanded asset acquisition and diversification strategy.”

About the Company

American Strategic Investment Co. owns a portfolio of commercial real estate. Additional information about ASIC can be found on its website at AmericanStrategicInvestment.com.

Forward-Looking Statements

The statements in this press release that are not historical facts may be forward-looking statements. These forward-looking statements involve risks and uncertainties that could cause actual results or events to be materially different. The words “may,” “will,” “seeks,” “anticipates,” “believes,” “expects,” “estimates,” “projects,” “plans,” “intends,” “should” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These forward-looking statements are subject to a number of risks, uncertainties and other factors, many of which are outside of the Company’s control, which could cause actual results to differ materially from the results contemplated by the forward-looking statements. These risks and uncertainties include (a) the anticipated benefits of the Company’s election to terminate its status as a real estate investment trust, (b) whether the Company will be able to successfully acquire new assets or businesses, (c) the ability of the Company to consummate the sale of 9 Times Square on the contemplated terms, if at all; (d) the ability of the Company to execute its business plan and sell certain of its properties on commercially practicable terms, if at all; (e) the potential adverse effects of the geopolitical instability due to the ongoing military conflict between Russia and Ukraine and Israel and Hamas, including related sanctions and other penalties imposed by the U.S. and European Union, and the related impact on the Company, the Company’s tenants, and the global economy and financial markets, (f) the potential adverse effects of inflationary conditions and higher interest rate environment, (g) that any potential future acquisition or disposition is subject to market conditions and capital availability and may not be completed on favorable terms, or at all, and (h) the Company may not be able to continue to meet the New York Stock Exchange's (“NYSE”) continued listing requirements and rules, and the NYSE may delist the Company's common stock, which could negatively affect the Company, the price of the Company's common stock and the Company's shareholders' ability to sell the Company's common stock, as well as those risks and uncertainties set forth in the Risk Factors section of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 filed on April 1, 2024 and all other filings with the Securities and Exchange Commission after that date including but not limited to the subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as such risks, uncertainties and other important factors may be updated from time to time in the Company’s subsequent reports. Further, forward-looking statements speak only as of the date they are made, and the Company undertakes no obligation to update or revise any forward-looking statement to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results, unless required to do so by law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241210132355/en/

Investor Relations

info@ar-global.com

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Source: American Strategic Investment Co.

FAQ

When is American Strategic Investment Co. (NYSE: NYC) closing the sale of 9 Times Square?

The closing date for the sale of 9 Times Square is set for December 19, 2024.

What is the contract sales price for American Strategic Investment Co.'s 9 Times Square property?

The contract sales price for 9 Times Square is $63.5 million.

How much net proceeds will American Strategic Investment Co. (NYSE: NYC) receive from the 9 Times Square sale?

The company expects to generate approximately $13.5 million in net proceeds from the sale.

What is the non-refundable deposit amount for the 9 Times Square sale?

The buyer has paid a $7 million non-refundable deposit for the sale.