GlobeSt.com has also received confirmation that two other Midtown towers, including Park Avenue Tower and 850 Third Ave., are changing hands. Although oil-rich sovereign-wealth funds are becoming a major player in New York City's real estate market due partly to an exchange rate that is in their favor, domestic players have not left the game.
 850 Third Ave. |
 1301 Ave. of the Americas |
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In other Macklowe news, Paramount Group is set to take Macklowe's 1.8-million-sf 1301 Avenue of the Americas for $1.45 billion; however a Paramount spokesperson tells GlobeSt.com that they have "no comment regarding 1301 Avenue of the Americas." But an industry source confirms that the Paramount Group deal is "in the works." The source notes that the number is in the right ballpark, although "it might be a little low." Although 850 Third Ave., Park Avenue Tower and 1301 Sixth Ave. are owned by Macklowe, since Macklowe turned over the properties to Deutsche Bank, they are Deutsche deals. Deutsche Bank sources could not provide GlobeSt.com with confirmation.
 Chrysler Building |
Foreign investors are also continuing to be a major player in Manhattan real estate. As the New York Post reported this morning, the Abu Dhabi Investment Council is negotiating to buy a 75% stake in the 1.3-million-sf Chrysler Building for $800 million. The assets would be purchased from TMW, the German arm of an Atlanta-based investment fund. Tishman Speyer would reportedly remain in charge of the building, with the Abu Dhabi fund acting as a silent partner. Queries to Tishman Speyer were unanswered by deadline.
Hugh Finnegan, an attorney in the real estate group at Sullivan & Worcester LLP, tells GlobeSt.com that there are a "plethora of possibilities" as to why TMW would be eager to cash out of its Chrysler stake. Some potential reasons include that "they are looking at other opportunities, they had hoped to get cash through a refinance but the market is against them, or the offer was too good to pass up."
He says that the Manhattan market is attractive to both foreign and domestic buyers. "The New York market has been relatively immune to the market correction going on pretty much throughout the rest of the country," he says. "When the market gets strong again, it will be manifested in New York first. Both foreign and local investors are comforted by the ongoing stability of New York real estate."
Finnegan says that he expects to see the trend of sovereign wealth funds looking to local trophy towers to continue. "They have cash, the exchange rate is in their favor and New York City remains an attractive market."
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Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
