The Real Deal New York

HNA near deal to sell 1180 Sixth Avenue

Nightingale Properties set to sign hard contract for about $320M: sources
By Mark Maurer | Twitter_logo_blue copy September 07, 2017 04:00PM

HNA’s Chen Feng and 1180 Sixth Avenue

Nightingale Properties is close to signing a hard contract to acquire the 384,000-square-foot Midtown office building at 1180 Sixth Avenue from a subsidiary of HNA Group and partner Murray Hill Properties for about $320 million, sources told The Real Deal.

HNA Property Holdings, an affiliate of one of China’s biggest conglomerates, began exploring a sale of the 22-story office property at West 46th Street in March.

HNA paid $259 million in 2011 for a 90 percent stake in the property, then owned by the Carlyle Group. At the time, Carlyle was delinquent on $277.5 million in loans attached to the property. Murray Hill Properties holds a minority stake.

Scripps Networks Interactive occupies about 126,000 square feet at the Class A building, with a lease not set to expire until 2021.

Sources said Nightingale has been seeking an equity partner in the deal. The price per square foot is slated to come out to roughly $833.

Eastdil Secured is representing the sellers in the deal. Representatives for HNA and Eastdil declined to comment, and Nightingale and Murray Hill could not be reached.

Nightingale, a Midtown-based investment firm founded by Elie Schwartz and Simon Singer in 2005, has done a few Manhattan deals to date – two leaseholds in the past two years and a retail condominium in Chinatown. The firm bought the leasehold for 645 Madison Avenue with Friedland Properties for $76 million in 2015 and the leasehold for 20 East 46th Street. In July, it picked up the retail condo at 208 Canal Street for $23.6 million.

In other major cities though, Nightingale has shown a willingness to strike larger deals, including in Philadelphia, where it bought an office complex in July for $328 million.

HNA turned heads in May with its $2.2 billion purchase of Brookfield Property Partners’ 245 Park Avenue and partnered with Tishman Speyer on the proposed Hudson Yards office tower the Spiral. The firm is also Murray Hill’s equity partner on 850 Third Avenue, which the two bought for $463 million last year.

Recent disclosures about a New York-based charity that owns a majority of HNA’s shares have raised eyebrows regarding its opaque ownership structure. HNA continued to pursue the sale of 1180 Sixth as it put the brakes on new acquisitions amid Chinese officials’ crackdown on debt to curb overseas investments.