The 10 biggest NYC investment sales of 2017
HNA's megadeal and New York REIT's mass sell-offs led the list
In 2017, office towers continued their dominance among New York City investment sales, but the deals were often smaller than in recent years. The nature of the Manhattan trophy tower game shifted under the weight of a sluggish, transitional market. Billion-dollar building sales were scarce, as owners opted to sell partial stakes, recapitalize or refinance in lieu of an all-out sale. The city is on pace to record $32.5 billion in New York City investment sales this year, a roughly 44 percent year-over-year decline from $57.8 billion, according to Cushman & Wakefield data.
The Real Deal looked at the year’s 10 largest building sales. Nine were office buildings, while one residential. The top 10’s total dollar volume is $8.1 billion, a 36 percent year-over-year drop from $12.7 billion. The 2017 ranking is based on TRD‘s data, sources and Real Capital Analytics. It includes closed 2017 sales of partial or complete stakes.
Multi-building portfolios such as Madison International Realty’s stake in a $1 billion New York-New Jersey retail portfolio and construction projects such as Mitsui Fudosan’s stake purchase in the 50 Hudson Yards project were also excluded.
The second half of the year saw a flurry of big-ticket deals that have not yet closed and therefore are not included. These include Rockpoint Group and Brooksville Company’s $905 million purchase of Starrett City; WeWork and Rhone Capital’s $850 million purchase of the Lord & Taylor flagship; and Oxford Properties Group’s $700 million purchase of the St. John’s Terminal site.
Here’s what made the cut:
|The 10 biggest NYC building sales of 2017|
|1||245 Park Avenue, Plaza District||$2.2 billion||100%||HNA Group||Brookfield Property Partners, Clarion Partners as agent for NYSTRS||CBRE|
|2||60 Wall Street, Lower Manhattan||$1.04 billion||100%||Singaporean sovereign wealth fund GIC||Paramount Group and Morgan Stanley||HFF|
|3||One Worldwide Plaza, Midtown West||$840 million||48.7% of $1.725 billion value||RXR Realty and SL Green Realty||New York REIT||CBRE and Eastdil Secured|
|4||1 Liberty Plaza, Lower Manhattan||$759.5 million||49% stake of $1.55 billion value||Blackstone Group||Brookfield Property Partners||Cushman & Wakefield|
|5||85 Broad Street, Lower Manhattan||$652 million||100%||Ivanhoe Cambridge and CallahannCapital Partners||Beacon Capital Partners and MetLife||Eastdil Secured|
|6||1515 Broadway, Times Square||$628.9 million||43% stake of $1.95 billion value with 75% closing in 2017||Allianz Real Estate||SL Green Realty||Cushman & Wakefield|
|7||375 Hudson Street, Hudson Square||$615 million||100%||Trinity Real Estate||Tishman Speyer||Eastdil Secured|
|8||1440 Broadway||$520 million||100%||CIM Group||New York REIT||CBRE and Eastdil Secured|
|9||685 Third Avenue||$467.5 million||100%||Unizo Holding Co.||TH Real Estate||CBRE|
|10||180 Water Street||$416 million||90% stake of $450 million value||Metro Loft Management||Vanbarton Group||Cushman & Wakefield|
|Source: The Real Deal analysis of Real Capital Analytics, news reports and industry sources. Partial interest sales are given the value of the stake acquired.|
1. 245 Park Avenue, $2.2 billion
Buyer: HNA Group
Seller: Brookfield Property Partners and the New York State Teachers’ Retirement System
Chinese conglomerate HNA Group’s wild buy this year was one of the largest prices ever paid for a Manhattan office tower. The 45-story, 1.8 million-square-foot building, located between East 46th and 47th streets, is home to Heineken, Wisdom Tree Investments, and Angelo Gordon & Co. Since closing on the deal in May, HNA has faced increased scrutiny in China and abroad – over its opaque ownership structure, mounting debts, and extensive spending spree amid Chinese capital controls. The company recently announced plans to sell $6 billion in real estate, Including 850 Third Avenue and 1180 Sixth Avenue – the latter of which HNA is still negotiating to sell to Nightingale Group. HNA, however, has ruled out selling 245 Park.
2. 60 Wall Street, $1.04B (partial stake)
Buyer: GIC Seller: Paramount Group and Morgan Stanley
Singaporean sovereign wealth fund GIC’s 95 percent purchase of this building was the one major investment sales deal already was in contract going into 2017. The majority-stake deal valued the 50-story Financial District office tower at $1.1 billion. The sale held firm near the top of the ranking for the rest of the year. GIC received a $575 million acquisition loan from Aareal Capital to finance the purchase.
3. One Worldwide Plaza, approx. $840M (partial stake)
Buyer: SL Green Realty and RXR Realty
Seller: New York REIT Brokerages: Eastdil Secured and CBRE (sellers); Cushman & Wakefield (buyer – RXR)
New York REIT came one step closer this year to parting with its crown jewel, One Worldwide Plaza. In June, the real estate investment trust led by Wendy Silverstein exercised its option to buy out its partners and take full control of the property. While this 50-story Midtown office tower was initially on the market in full during New York REIT’s 4.4 million-square-foot office-and-retail liquidation, only a portion of the property ended up trading. SL Green and RXR acquired a 48.7 percent stake in October, valuing the tower at $1.725 billion.
4. One Liberty Plaza, approx. $759.5M (partial stake)
Buyer: Blackstone Group
Seller: Brookfield Property Partners Brokerage: Cushman & Wakefield
Toronto-based Brookfield, which has been unable to sell a minority stake in Brookfield Place, did have luck with other big sales this year – not only with 245 Park, but also with One Liberty Plaza. Blackstone closed earlier this month on a 49 percent purchase, valuing the 54-story, 2.3 million-square-foot Financial District office tower at $1.55 billion. Brookfield had put it on the market in the fall, and unlike many other 2017 deals, found a taker swiftly.
See more 2017 year end reviews here
5. 85 Broad Street, $652M
Buyer: Ivanhoe Cambridge and Callahan Capital Properties
Seller: MetLife and Beacon Capital Partners
Brokerage: Eastdil Secured
Ivanhoe Cambridge is almost a permanent fixture on this ranking. This time, the Canadian pension manager and its frequent partner Callahan picked up Goldman Sachs’ former headquarters at 85 Broad, a 1.1 million-square-foot office tower. Current tenants include Vox Media, WeWork and Oppenheimer & Co. The seller, MetLife, also took a $150 million preferred equity stake this year in 498 Seventh Avenue.
6. 1515 Broadway, approx. $628.9M (partial stake)
Buyer: Allianz SE
Seller: SL Green Brokerage: Cushman & Wakefield
SL Green began shopping a stake in this 54-story Midtown office tower in January. And almost exactly one year later, the deal will fully close. German insurer Allianz, which bought a stake in 10 Hudson Yards last year, entered contract in November for a 43 percent interest in 1515 Broadway. Viacom anchors the 57-story, 1.9 million-square-foot property, which is valued at a whopping $1.95 billion as a result of the deal. Sources said 75 percent of the deal has closed; the remainder will close early next year. Allianz is also buying a portion of the debt.
7. 375 Hudson Street leasehold, $615M
Buyer: Trinity Real Estate
Seller: Tishman Speyer
Trinity Real Estate, an arm of Trinity Church, acquired the leasehold of a Hudson Square office building; it already owns the land beneath it. Tishman Speyer has held the leasehold ever since developing the 19-story, 1.1 million-square-foot property in 1987. Tenants include advertising agencies Saatchi & Saatchi and book publisher Penguin Random House.
8. 1440 Broadway, $520M
Buyer: CIM Group
Seller: New York REIT
Brokerages: Eastdil Secured and CBRE
Another weighty asset in New York REIT’s holdings made the ranking, thanks to CIM Group. The Los Angeles-based private equity firm plans to bring the 25-story, 749,000-square-foot property’s 40 percent occupancy to full. The deal closed this month, around the time New York REIT also closed on the sales of 245 West 17th Street and 218-220 West 18th Street ($515 million); and 256 West 38th Street and 229 West 36th Street for $155 million.
9. 685 Third Avenue, $467.5M
Buyer: Unizo Holdings
Seller: TH Real Estate (TIAA)
Japanese investment firm Unizo Holdings, formerly known as Jowa Holdings, paid all-cash for this 31-story, 646,000-square-foot Midtown East office property. The building is home to multiple government agencies and was owned by Pfizer until the pharmaceutical giant sold it to the pension fund TIAA in 2010.
10. 180 Water Street, $416M (partial stake)
Buyer: Metro Loft Management
Seller: Vanbarton Group
Broker: Cushman & Wakefield
With another office-to-luxury rental conversion in the can, Nathan Berman’s Metro Loft Management sought to buy out its development partner Vanbarton Group at 180 Water Street. Prior to the 573-unit conversion, Metro Loft had only a 10 percent stake. The firm paid $416 million to take full ownership in October and then secured a $385 million refinancing, according to records.