NYRR Takes Worldwide Plaza Stake

NEW YORK CITY-George Comfort & Sons and RCG Longview have sold a 48.9% equity interest in Worldwide Plaza to American Realty Capital New York Recovery REIT for $220.1 million. The sellers, who acquired the 49-story office tower in 2009 for $590 million, will retain the remaining 51.1% equity interest.

“Worldwide Plaza is an important addition to our Manhattan portfolio,” says Michael Happel, CIO at NYRR. He calls the 1.8-million-square-foot office tower “a prime example of the type of high-quality Manhattan assets we have targeted for purchase, and is consistent with our strategy of buying good real estate with stable cash flows at prices below replacement cost.”

In addition, Happel says, the tower offers “an opportunity to increase cash flow through additional leasing opportunities while generating stable cash flow from its existing strong tenant base. We continue to see acquisition opportunities throughout Manhattan and its sister boroughs, and remain committed to making purchases consistent with our strategy.” Combined with NYRR's existing portfolio and pending acquisitions, the Worldwide Plaza stake would increase the REIT's holdings to 22 properties.

Built in 1989, Worldwide Plaza at 825 Eighth Ave. was acquired by Macklowe Properties in 2007 as part of a portfolio of former Equity Office Properties assets in Midtown. All seven towers went back to lender Deutsche Bank about a year later after Macklowe was unable to refinance approximately $7 billion in short-term debt used to acquire the properties. Currently it's 91% leased; it was about 40% vacant when George Comfort and RCG Longview acquired it.