Despite ongoing uncertainty in the global economy, a select number of real estate investors are still making huge profits on timely deals by flipping trophy properties for double what they paid for them in the recession, the Wall Street Journal reported. Their success has engendered confidence in New York as a safe haven for investment.
Last October for instance, Boston-based firm Rockpoint Group sold its 49 percent stage in Park Avenue Plaza at 55 East 52nd Street in a deal valuing the building at $1.19 billion; when Rockpoint bought into the building in 2010, the asset was valued at just $695 million. And last month, Harbor Group International found a buyer to pay more than $265 million for a 22-story office building at 4 New York Plaza for which Harbor paid $107 million two and a half years ago.
“It caused some butterflies in our stomach,” Jordan Slone, Harbor Group’s CEO, said of buying the property at such a risky time.
These deals have made other investors confident they can flip their properties, the Journal said. The owners of Worldwide Plaza at 825 Eighth Avenue for example, have put the 1.8 million-square-foot property on the market and are hoping it will fetch around $1 billion. They bought it for $600 million in 2009. [WSJ]