From left: Calstrs CEO Jack Ehnes and LCOR CEO Peter Dilullo
The California State Teachers’ Retirement System is set to purchase a more than 90 percent stake in the large New York developer LCOR from Lehman Brothers, the Wall Street Journal reported. Lehman Brothers first invested in LCOR in 1999 and saw it through the recession and numerous projects, including the conversion of 25 Broad Street and Terminal 4 at JFK International Airport. [more]
From left: Paula Del Nunzio and 7 West 54th Street
An office building on West 54th Street is hitting the market at just less than $4,000 per square foot, the most expensive asking price ever for an office property, according to the Wall Street Journal. The building is a Beaux-Arts mansion at 7 West 54th Street, between Fifth and Sixth avenues, that was built more than a century ago as the home of Philip Lehman, the former head of Lehman Brothers. [more]
Rendering of the Triple Five Meadowlands project, set to be completed in 2013
A New York appeals court has ruled in favor of the former developer of the Meadowlands Xanadu shopping and entertainment project in East Rutherford, N.J., overturning a lower court ruling and giving the former developer the right to recover $600 million in damages against a Lehman Brothers affiliate which cut off the promised construction financing for the project, an attorney for the developer said today. [more]
Equity Residential Chairman Sam Zell
Equity Residential increased its bid for the final 26.5 percent stake in Archstrone to $1.5 billion, triggering a guaranteed breakup fee if Lehman Brothers matches the bid, Bloomberg News reported.
Bank of America and Barclays have looked to unload their combined 53 percent stake in the Archstone portfolio, and that has resulted in a contentious battle for the stake between Lehman and Sam Zell’s Equity. Lehman already possessed a 47 percent stake in the portfolio and recently purchased an additional 26.5 percent stake for more than $1.3 billion. [more]
From the October issue: In December 2007, less than a year before the fall of Lehman Brothers and as the vise of the credit crunch was tightening, SL Green Realty closed on one of the biggest deals of the decade: $1.575 billion for 388 and 390 Greenwich Street, the 2.6 million-square-foot office complex then occupied largely by Citigroup.
But SL Green, New York’s biggest commercial landlord, did not act alone in the $598-a-square-foot purchase. It had a little help from some loonies, or Canadian dollars. The REIT’s minority partner on the deal, taking a 49.4 percent stake, was SITQ, the real estate investment wing of Caisse de Dépôt et Placement du Québec, a Montreal-based pension fund. (SITQ has since merged with Caisse’s other real estate subsidiary, and now goes by the name Ivanhoe Cambridge.) [more]
Steve Witkoff’s Witkoff Group has completed its purchase of part of the former International Toy Center building from Lehman Brothers Holdings for $191 million, Lehman announced yesterday, following a bankruptcy auction by Eastdil Secured in June. Witkoff is planning a $290 million condominium conversion of the property, at 1107 Broadway, featuring 145 units, in collaboration with a Morgan Stanley real estate fund.
Eastdil Secured brokers Adam Spies and Doug Harmon represented the seller in the deal, and brought the buyer and seller together.
The closing of the 16-story office building follows the sale of 200 Fifth Avenue earlier this month, which was previously the main Toy Center building, for $726 million. [more]
Real estate giants the Blackstone Group, Brookfield Asset Management, Equity Residential and AvalonBay Communities have all submitted bids for real estate investment trust Archstone in recent weeks, but the offers haven’t been enough to resolve a disagreement among the owners over how to unwind Archstone, the Wall Street Journal reported.
Barclays and the estate of Lehman Brothers Holdings are in an ongoing dispute over Archstone, a $22 billion investment made at the peak of the commercial real estate boom that contributed to Lehman’s downfall. According to the Wall Street Journal, Barclays is pushing to sell the company or its assets privately whereas Lehman favors a longer-term approach: taking the company public in what would be the largest real estate initial public offering ever. [more]
From the September issue: In its eight years of publication, The Real Deal has covered the real estate industry in a city that’s been transformed by a massive building boom, was crippled by the subsequent bust, and is now in the midst of a tentative recovery.
The compendium of stories we’ve written runs the gamut from the record-setting building and apartment purchases during the boom, to the toppling of mega-developers during the bust, to new entrepreneurs trying to get into the real estate game during today’s fragile recovery. This month, for the anniversary of our 100th issue, we bring you some of the most compelling stories we’ve tracked in these pages, many of which have unfolded and evolved over time, much as the magazine itself has. And watch the video below to see The Real Deal Publisher Amir Korangy talk about the special process for creating the unique 100th issue cover.
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The Witkoff Group, owner of one of the International Toy Center buildings located at 1107 Broadway, is joining forces with a Morgan Stanley real estate fund for a $290 million condominium conversion of the property featuring 145 units, the Wall Street Journal reported. The collaborators are still searching for a financing partner, but are expected to close the deal in the next month.
Witkoff acquired the 16-story, 350,000-square-foot property for $190 million in a one-day auction in June by seller Lehman Brothers. A number of high-profile bidders attended the event, including CIM and William Macklowe, SL Green Realty, and L&L Holdings.
Witkoff and Morgan Stanley anticipate spending $100 million to renovate the building, the Journal said. [more]
Lehman Brothers has reached a deal to sell the in-default debt on 1107 Broadway to the Witkoff Group and Howard Lorber’s Vector Group for about $190 million, the New York Post reported.
The deal, determined at auction yesterday, comes just days after Lehman sold its majority ownership stake in 200 Fifth Avenue, located between 23rd and 24th streets, to JPMorgan Chase. The two buildings, connected by a footbridge, make up what used to be the International Toy Center.
“We think it is one of the great opportunities we’ve seen,” Steve Witkoff, CEO of the Witkoff Group, told the Wall Street Journal.
Witkoff, who has 90 days to finalize the deal at 1107 Broadway, between 24th and 25th streets, said he plans to turn the building into high-end condominiums. [more]
