One of the largest landlords in New York City may have just nabbed a prime Austin property from Nate Paul’s World Class Holdings.
Stephen Ross’ Related Companies appears to have turned the trick on a six-acre South Congress Avenue parcel that was subject to a bankruptcy auction, the Dallas Business Journal reports.
The New York-based developer actually had the third-highest bid for the property at $65 million. Rising Tide Investment, a shell company tied to Paul’s World Class Holdings, originally won the site with a bid of $95.1 million, but opted out in late August. Then it was NIA ATX LLC’s chance to get the property with its runner-up bid of $95 million. Firm reportedly attempted to extend the closing deadline.
However, Chapter 7 Trustee Randolph N. Osherow expressed concerns about the Austin-based NIA ATX LLC’s ability to close on the property.
“I do share some concern that no back up proposal exists to protect the Estate in the event that NIA ATX also defaults on its closing obligations,” Osherow said.
Not long after, Related struck an agreement with Osherow “for the face amount of $65 million, but contingent on the failure of NIA ATX to close its approved bid.” On September 15, the prolific developer was approved by a bankruptcy judge to purchase the property for $65 million, provided the firm can finalize the deal.
Should Related also fail to close, Kennedy Lewis Investment Management is next in line to buy the South Congress site for $52.7 million.
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Attorney Josh Judd of law firm Andrews Myers PC, who’s representing the company, told ABJ that his client is “not anticipating any problems” closing on the sale by the September 30 deadline. Meanwhile, executive Mike Iannacone said it was “too early to tell” what Related might ultimately do with the site, but noted it will likely be “a vertical mixed-use development of some sort.”
Upon closing, the acquisition will be the third Austin move by Ross’ company. On September 9, Related announced plans to construct two towers near South Congress Avenue, just south of Lady Bird Lake. All three are located within a mile of the Congress Avenue Bridge, an area with numerous vertical development plans in the works. The most notable of these projects is the redevelopment of the former Austin American-Statesman headquarters, which was recently delayed over disputes about affordable housing.
Related, which has an estimated $60 billion portfolio, is known for its ambitious developments such as the 28-acre Hudson Yards development in Manhattan, The Grand LA in Los Angeles and The 78 in Chicago.
— Maddy Sperling