Allianz looks to take 30% stake in massive Terminal Stores deal

L&L Holding and Normandy Real Estate purchased site for $900M this summer

Terminal Stores and Christoph Donner
Terminal Stores and Christoph Donner

L&L Holding Company and Normandy Real Estate Partners are about to get another partner on their massive Terminal Stores deal.

Allianz Real Estate of America is closing in on a deal to take a roughly 30 percent stake in the building, according to sources familiar with the deal. L&L and Normandy had purchased the Chelsea building over the summer for about $900 million, triple its prior valuation.

The move by Allianz would value the 1.2 million-square-foot site at about $733 per square foot — the same as the purchase price — and Allianz would also fund part of the $520 million in equity from JPMorgan, acting as an adviser to the California State Teachers Retirement System.

Real Estate Alert was the first to report the deal.

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Terminal Stores was last valued at $300 million in 2014, when GreenOak Real Estate bought a 49 percent stake in the building. Waterfront New York bought the site in 1983 for roughly $12 million.

L&L and Normandy plan to turn the warehouse into a property worth about $1.8 billion in the next four years. Their designs call for creating 100,000 square feet of glass penthouse space atop the building, and they hope to get rents of about $135 per square foot.

The companies also want to create a retail corridor similar to Chelsea Market and convert 500,000 square feet of storage space into office space. COOKFOX will design the project.