German investor buying 100 Pearl Street office tower for $850M
Sellers GFP and Northwind oversaw $250M renovation of property formerly known as 7 Hanover Square
GFP Real Estate and the Northwind Group have agreed to sell the tower at 100 Pearl Street — previously known as 7 Hanover Square — to German investor Commerz Real.
The price for the building was $850 million, or $900 per square foot, according to the Commercial Observer. Cushman & Wakefield arranged the transaction.
The office building spans just under 1 million square feet and was recently renovated for $250 million. Changes to the 1983 building included a new lobby, infrastructure improvements, the addition of a food hall and the creation of a tenant-exclusive rooftop and amenity lounge.
Ownership of the building between GFP and Northwind has been brief, although GFP is staying on as part of a long-term management agreement. The two companies acquired the building in 2018 for $308.5 million. It wasn’t long, however, before the companies began looking for an equity partner.
They eventually found one in TPG Real Estate Partners, which agreed to join the purchase and repositioning of the building as a majority stakeholder. The stake it purchased valued the building at $600 per square foot, or approximately $585 million overall, The Real Deal previously reported.
The office building is 96 percent leased and 92 percent of tenants are locked in to the building until at least 2050, the Commercial Observer reports. Among its tenants are NYC Health + Hospitals, which agreed to take up 500,000 square feet for 25 years, and the Securities and Exchange Commission, which signed a 20-year lease.
Germany-based Commerz Real has proven to have a healthy appetite for big commercial real estate purchases stateside. The firm purchased an office building in the Fulton Market section of Chicago in 2019 for $175 million, one of the biggest office sales in the city that year. The arm of Commerzbank also agreed to purchase the NYU Langone Medical Center for more than $330 million in 2018.
[CO] — Holden Walter-Warner