Forest City Realty Trust sold 461 Dean Street to Principal Global Investors for $156 million, sources familiar with the transaction told The Real Deal on Wednesday.
The 363-unit rental building was the last property within Pacific Park that Forest City owned by itself, having sold the majority of its stake in the development to its partner, Greenland USA, in January. Forest City announced the sale earlier Wednesday but did not identify the buyer.
Representatives for Forest City declined to comment. A call to Principal, based in Iowa and led by CEO James McCaughan, wasn’t immediately returned.
News of the sale closely follows the REIT board’s decision against selling the company after more than 50 potential buyers expressed interest. Talks fell apart with one unidentified suitor after the two companies couldn’t agree on how to deal with Forest City’s various partners on its properties. The prospective buyer wanted each partner to sign off on it taking control of the REIT before the deal went through, a condition that Forest City wouldn’t accept.
Instead, the REIT decided to shift control of its board further away from the Ratner family, while giving hedge funds Starboard Value and Scopia Capital Management additional seats.
Since becoming a REIT in January 2016, Forest City has moved away from ground-up development. The company touted 461 Dean Street as the world’s tallest modular building, that would “crack the code” for this type of construction in the city. That vision didn’t quite pan out, as the project faced delays and litigation with Forest City’s now-former partner, Skanska. Only four of the 15 planned buildings at Pacific Park are complete.
Mark Maurer contributed reporting.