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Despite an “overheated” market, Bank of America is ramping up its CRE exposure
The bank has taken its own advice and recently leased two buildings on Sixth Avenue
As New York’s commercial real estate market continues to heat up, Bank of America is going headfirst into the market after holding off large investments.
“We’re actually, quite frankly, increasing our exposure right now in commercial real estate because we stayed out,” said Brian Moynihan, the company’s chief executive, according to Bloomberg.
He flagged the new direction at a Goldman Sachs conference in New York this week, which comes as the company seeks to introduce a campus-like model to its spaces after acquiring new spaces around its Bryant Park hub.
The Manhattan office condominium market reached new heights this year. Over $230 million in deals were done in the first half of the year, and the average price per square foot topped out at $934, up 23 percent over the previous five-year average.
Last year, the bank signed a lease for all 386,000 square feet of space at the 15-story 1100 Sixth Avenue in Midtown, and in January took 127,000 square feet at 1114 Sixth Avenue.
Bank of America was also tapped last month to help Anbang Insurance Group sell a $5.5 billion hotel portfolio, including the Essex Hotel in New York.
Bank of America placed 15th on The Real Deal’s January 2018 ranking of the top 15 construction lenders in New York, with $302 million in loans. It also originated $1.23 billion in non-construction commercial loans between October 2016 and September 2017, according to our ranking. [Bloomberg] — David Jeans