Norges Bank Investment Management has teamed up with Beacon Capital Partners to acquire Midtown, Manhattan office tower, 1177 Avenue of the Americas. The purchase through a joint venture, at $542.6 million, will give the two 95 percent equity control at the property, known as Americas Tower. The deal values the property at $571.1 million.
Additionally, Norges said that a Beacon affiliate will purchase a five percent stake in the asset. Silverstein Properties and California State Teachers’ Retirement System, through a joint venture of their own, were listed as the sellers.
The property consists of more than a million square feet of office space. The tenant roster includes CoStar, Regus, the Weather Channel, Kramer Levin, Gates Capital Management, Drinker Biddle & Reath and Practising Law Institute, according to a listing from Metro Manhattan Office Space.
Also, the building is within walking distance of Bryant Park and Penn Station.
Investors continue to be attracted to office in Manhattan. Norges and Beacon's deal comes a week after Vornado Realty Trust struck a deal to acquire 623 Fifth Avenue in Midtown East, Manhattan, for $218 million. The REIT is betting that it will improve upon the turbulent current 75 percent vacancy rate at the property. Also, in August, RXR closed its buy of 590 Madison Avenue — marking the largest non-user office acquisition in NYC since 2018.
The activity comes as Manhattan's office sector is poised to have its best year of leasing in six years after posting roughly 3.01 million square feet in signings during July, according to a report from Colliers. Currently, availability rates in the market are at the lowest levels since January 2021.
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