NorthStar invests $340M for 30 percent stake of RXR

Scott Rechler’s RXR Realty has scored a $340 million investment from NorthStar Realty Finance Corporation, giving the firm a cash infusion that will help carry out the planned spin-off of its asset management business into a publicly traded real estate investment trust.

The investment gives NorthStar a 30 percent ownership interest in RXR, the latter of which has recently been on a buying spree, picking up assets such as 450 Lexington Avenue from Istithmar World Capital, 75 Rockefeller Plaza and 237 Park Avenue and raised over $3 billion in institutional capital. The firm currently holds interests in $6.5 billion of assets made up of 108 operating properties, or 20 million square feet, according to CoStar Group.

“Given RXR management’s track record in both the public and private markets … they are a perfect fit for NorthStar, both in terms of further diversifying NorthStar’s asset base with trophy properties in New York City and growing NorthStar asset management business,” David Hamamoto, chairman and CEO of NorthStar, told CoStar.

The planned public offering is expected to raise over $580 million, and NorthStar plans to use the proceeds to fund its investment in RXR and the possible acquisition of a $400 million portfolio of manufactured housing communities that are currently under contract. [CoStar Group] — Julie Strickland