The client purchased a building in Lower Manhattan in June 2004 believing it would reinvigorate the organization. The building required substantial renovation, with gutted floors and an antiquated and neglected infrastructure. The building was not in compliance with ADA requirements which limited the client’s goal of attracting the public to events and exhibitions. Our team was hired to assist the ANS with three key objectives:
Course of Action
ANS wanted to generate cash flow from assets in its unrestricted endowment. The largest single asset in that fund was their building, and it generated no cash. Selling the property and investing the proceeds in assets would yield significant earnings.
With a move out of Manhattan not an option, and costs to buy a renovated building not feasible, leasing remained the only option. We sold their headquarters and negotiated a new 20-year lease at One Hudson Square. The transaction enabled the non-profit to obtain the financial security and self sufficiency that were their stated objectives. In addition, the leasing of space allowed them to focus on their mission as opposed to managing real estate.