75% Interest in Chrysler Building Sells for $300 Mil, Experts Question Trend

NEW YORK CITY-The Chrysler Building has joined the list of trophy buildings over the last six months to have significant interest sold. Rockefeller Center and the World Trade Center are among the most notable, the sales of which have been covered extensively by GlobeSt.com. Now, 75% of the interest in the Chrysler Building has been sold to TMW, a German investment group, for a total of $300 million. Industry experts debate whether or not the trophy trend is wise.

Many in the industry have indicated the most recent deal related to the 77-story, 1.2-million-sf was a matter of financing. In the case of Rockefeller Center, there were rumors when the asking price wasn’t offered in the bidding process that ownership would seek financing instead. In this deal, Tishman Speyer and Travelers Group will retain ownership, and Tishman’s role has been described as a controlling interest and management of the building. Tishman Speyer was the buyer in the Rockefeller Center deal. The value of the Chrysler Building’s value has been readjusted to $400 million as a result of this deal.

Some industry experts see this deal as part of a larger trend to cash in on the hot market before a slowdown could hurt real estate. “The year 2000 was the year where every trophy and mature property went up for sale,” Peter Pattison of Peter Pattison Ltd. “The sophisticated developers and owners thought that the values had peaked so there was an enormous amount of sales ending with the World Trade Center.” Others note that this may not be just about foresight and may not be the wisest trend.