Mori Trust’s Bet on 245 Park Ave is Part of U.S. Expansion

A Japanese family that helped transform Tokyo into a modern international city now has a toehold in New York.

Mori Trust, the development firm that last week bought a 50 percent stake in SL Green’s 245 Park Avenue, owns about $8 billion worth of real estate and is expanding in the United States.

“They have a substantial portfolio across trophy offices and hotels and resorts in Japan,” said Alex Foshay, the head of Newmark’s international capital division, who sold Mori its first U.S. property in 2017 — a pair of Boston office buildings for $673 million.

“They’re generally of the highest quality and highly innovative in their design,” he said, adding that planting a flag in New York has been “a desire of theirs for some time.”

Mori Trust last week signed a deal to buy roughly half the equity in 245 Park at a $2 billion valuation, as The Real Deal first reported Monday. SL Green had taken the property over at that same valuation in September after a long bankruptcy battle with the tower’s previous owner, China’s HNA Group.

The Japanese development firm is headed by president and CEO Miwako Date, 52, whose grandfather started rebuilding war-torn Tokyo in the 1950s.

Taikichiro Mori was an economics professor who inherited a small real estate business from his father, a rice farmer and merchant, as Japan’s economy started taking off after World War II.

He worked well with local residents and earned the nickname “ooya-san,” an endearing term for a landlord, on his way to building an immense fortune.

Mori was the world’s richest person in 1992 with a net worth estimated at $13 billion, according to Forbes. He died the next year at the age of 88.

Mori had mixed feelings about his impact on Tokyo’s skyline.

“We have to change in order to live in the new era,” he once said, according to his obituary in the New York Times.

Following his death, the Mori Building Company was passed on to Mori’s two sons: Minoru Mori and Akira Mori.

They had different styles. Forbes in 2004 described Minoru, the elder of the two, as “the visionary” while Akira was known as “the flinty businessman.” The two had a falling out and split their father’s company.

Akira, now 86 with an estimated net worth of $2.7 billion, went on to found Mori Trust, which in 2020 completed the 2-million-square-foot Tokyo World Gate office, hotel and residential tower.

Akira’s daughter, Miwako Date, took over the company in 2016 as Mori Trust launched a 10-year plan known as “Advance 2027” that includes investing 100 billion to 200 billion yen ($865 million to $1.7 billion) in the U.S.

The company bought a San Jose office campus for $429 million in 2019 and sold it to KKR two years later for $535 million. Mori paid about $500 million to buy an office building in Washington, D.C., last year, at which point it said it was ahead of schedule on its U.S. investment plan.

This year Mori partnered with Alexandria Real Estate Equities on a 345,000-square-foot life-sciences center in Boston.

Aside from being willing to write big checks at a challenging time for commercial real estate, Mori Trust also brings its venerable reputation to the table.

Foshay said the family’s integrity and reputation is of “utmost importance to them.”

“I think that reassurance and consistency is why you see them standing behind groups like SL Green and Alexandria,” he said.