Soho China Finds Buyer for Park Avenue Plaza Stake

Billionaire Chinese developer Zhang Xin is trading her stake in Park Avenue Plaza to one of the biggest names in New York real estate.

Through her firm Closer Properties, Xin sold her 49 percent interest in the tower at 55 East 52nd Street to Steven Roth’s Vornado Realty Trust, the Commercial Observer reported. The deal carried a $1.1 billion valuation for the office property, below the valuation Xin aimed for when listing her stake in January.

The deal will see Roth’s company assume $570 million in debt, sources told the outlet. Majority owner Fisher Brothers, meanwhile, is sticking around and will have joint control of the building when the sale closes, which is expected to happen by the end of the quarter.

A Newmark team including Adam Spies, Doug Harmon and Adam Doneger arranged the stake sale. Vornado and Newmark both declined to comment to the publication, while Closer and Fisher Brothers did not respond.

At the time of the listing in January, the 1.2 million-square-foot building was nearly fully leased to tenants including Evercore, Morgan Stanley and General Atlantic. The property has “no significant expirations until 2035,” according to Newmark’s offering memo.

Soho China, which Xin co-founded in 1995, bought a 49 percent stake in Park Avenue Plaza in 2011 from Rockpoint Group. That deal came in the same year that ownership refinanced its debt with a $575 million commercial mortgage-backed securities debt package split between a $460 million senior loan and a $115 million mezzanine loan. It’s unclear when Xin transferred the stake from Soho China to Closer.

Fisher Brothers and Vornado are making big plays across Manhattan’s office market.

Last year, Blackstone acquired a 46 percent interest in 1345 Sixth Avenue, valuing the building at $1.4 billion, while Fisher Brothers increased its majority ownership. The property was also refinanced with $850 million from the CMBS market, though the refinancing terms included a short two-year maturity with extension options.

And in November, the architect behind Vornado and Rudin Management’s 62-story, 2 million-square-foot office tower filed construction permits for the project at 350 Park Avenue. Citadel is a partner and will occupy 850,000 square feet, though controversy is swirling after the mayor posted a video singling out Citadel’s Ken Griffin regarding a proposed pied-à-terre tax.

— Holden Walter-Warner