Anbang Insurance Group abandoned plans to invest in Kushner Companies’ redevelopment of 666 Fifth Avenue.
“Kushner Companies is no longer in discussions with Anbang about 666 Fifth Ave.’s potential redevelopment, and our firms have mutually agreed to end talks regarding the property,” a Kushner spokesperson told the New York Post.
The Chinese insurance conglomerate was reportedly in advanced talks to buy a stake in the Midtown office tower and help Kushner redevelop it into a retail and condo building. The partners were seeking a $4 billion construction loan But some observers immediately expressed doubts about the strength of Anbang’s commitment and the wild numbers that circulated.
Investor documents obtained by Bloomberg projected that the completed redevelopment would be $7.2 billion, and another estimated cited by the Wall Street Journal valued a redeveloped 666 Fifth at $12 billion, which would easily be a record in America for a single building. That plan included tearing out the building’s steel frame and adding an additional 40 floors. The residential portion of the building would total 464,000 square feet, with condos projected to sell for $6,000 a square foot. If the Kushner’s went for the $12 billion plan, it would leave them with a 20 percent stake in the finished project. Kushner would also have to buy out its partner Vornado Realty Trust as well as the office tenants.
With Anbang out of the picture, Kushner will have to find a different equity partner. To complicate matters, the Post reports Kushner will not work with foreign sovereign wealth funds or companies with business before the U.S. government to avoid potential conflicts of interest. Jared Kushner recently left the family company to work as a senior adviser in Donald Trump’s White House.