Blackstone moves closer to 44 Wall buy after Swig settlement

Fund manager went into contract to buy FiDi office building in July

TRD New York /
May.May 24, 2016 01:34 PM

Kent Swig and Asher Zamir settled their lawsuit against the majority owner of 44 Wall Street Monday, clearing a major hurdle towards the building’s pending sale to the Blackstone Group.

Blackstone Real Estate Partners IV, a European real estate fund managed by Blackstone TRData LogoTINY, quietly went into contract to buy the 289,000-square-foot office building from Norwegian investment firm Obligo in July. The deal was part of a $2.7 billion real estate portfolio sale of Obligo assets in Scandinavia, Latvia, Germany and the U.S. Blackstone’s pending purchase of 44 Wall Street hasn’t been reported until today.

The closing is still delayed. A source familiar with the proceedings pointed to the overall complexity of the portfolio deal as the primary cause. But another likely complicating factor was litigation between Obligo and the building’s minority stakeholders Kent Swig and Asher Zamir.

Swig bought 44 Wall Street in 2004 with unnamed partners from Lend Lease Real Estate for $65 million. According to court records, as of November 2012 Swig held a 12.2 percent strake in the property, Zamir held 9.6 percent and an entity tied to Obligo held 78.2 percent. During the course of 2012, Obligo moved to take over the minority stakes after Swig, who was reportedly in financial trouble at the time, and Zamir failed to meet capital calls. Swig and Zamir contested the takeover in a November 2012 lawsuit, which dragged on for more than three years and left the building’s ultimate ownership structure unclear. The parties settled on Monday, court records show.

Obligo, meanwhile, is still fighting a separate lawsuit from Francis Greenburger’s Time Equities and investment banking firm Reinvest Capital over the property. The plaintiffs claim they reached an agreement with Obligo in March 2015 to buy 44 Wall Street, court documents show. Obligo elected to sell the property to Blackstone instead, and in June 2015 Time Equities sued the Norwegian firm for breach of contract. (Perhaps ironically, obligo is Latin for “I oblige.”)

On Feb. 25, a New York Supreme Court judge granted Obligo’s motion to dismiss the suit. Time Equities promptly appealed the decision.

It wasn’t immediately clear what the portfolio sale valued 44 Wall Street at, but the property’s stand-alone market value is likely well above $100 million.

Blackstone, Kent Swig and an attorney representing Time Equities declined to comment. An executive at Obligo’s New York office did not immediately respond to an email seeking comment.

The Blackstone Group was New York’s most active commercial real estate investor in 2015, scooping up Stuyvesant Town-Peter Cooper Village for $5.3 billion and a Manhattan residential portfolio from the Caiola family for $700 million, among other deals.


Related Articles

arrow_forward_ios
Blackstone's president Jonathan Gray and CEO Stephen Schwarzman (Credit: Gray via Drew Angerer/Getty Images; Schwarzman via Himanshu Bhatt/NurPhoto via Getty Images)

Blackstone: “We don’t need financing to get things done”

Blackstone: “We don’t need financing to get things done”
Blackstone’s Jonathan Gray and Starwood Capital Group’s Barry Sternlicht (Credit: Gray by  Drew Angerer/Getty Images; Sternlicht by Cindy Ord/Getty Images for 1 Hotels)

Blackstone, Starwood pick up stakes in Extended Stay America

Blackstone, Starwood pick up stakes in Extended Stay America
From left: Donald Trump, Jane Goldman of Solil Management, Jorge Perez of Related Group, Stephen Ross of Related Companies, Jeff Greene, Brian Chesky of Airbnb, Sam Zell of Equity Group Investments, Jeff Sutton of Wharton Properties with Adam Neumann, former WeWork CEO (Illustration by The Real Deal)

These US real estate titans made Forbes’ billionaires list

These US real estate titans made Forbes’ billionaires list
Clockwise from bottom left: 62-60 99th Street in Rego Park, 850-870 Third Avenue in Sunset Park and Square Mile Capital’s Craig Solomon with renderings of 550 Clinton Avenue in Brooklyn (Credit: Google Maps; Getty Images; Morris Adjmi Architects)

These were the top outer borough loans last month

These were the top outer borough loans last month
Blackstone's Jonathan Gray, Gaedeke Group's Sabine Gaedeke Stener and 44 Wall Street (Credit: Stener by Gaedeke Group; Gray by Drew Angerer/Getty Images, 44 Wall Street via Google Maps)

Blackstone sells office tower at 44 Wall Street for $200M

Blackstone sells office tower at 44 Wall Street for $200M
Brookfield Property Group’s Brian Kingston, Blackstone Group's Jonathan Gray and 1 Liberty Plaza (Credit: Google Maps)

Brookfield, Blackstone consider One Liberty Plaza sale

Brookfield, Blackstone consider One Liberty Plaza sale
Liberty View Plaza at 850 3rd Avenue and Marvin Schein (inset) (Photo by Axel Dupeux)

City lets Salmar bring office tenants to Brooklyn industrial property

City lets Salmar bring office tenants to Brooklyn industrial property
Brookfield's largest-ever $15B property fund has invested in properties from New York (666 Fifth Avenue) to Bangalore (the Leela Palace hotel) (Credit: Brookfield, Getty Images, Leela)

Real estate fundraising hits lowest level since 2013

Real estate fundraising hits lowest level since 2013
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...