RXR Closes $1.65B Avenue of the Americas Acquisition

An affiliate of RXR Realty LLC announced the closing of the $1.65 billion acquisition of 1285 Avenue of the Americas, as well as the long-term lease renewal of more than 900,000 square feet to keep UBS's North American headquarters in the office building. The Real Deal first reported that Scott Rechler's RXR Realty was on the verge of a deal to acquire the 42-story office tower, and reports this week that it partnered on the deal with real estate investor David Werner, according to the Commercial Observer, noting that the duo financed the purchase with $1.2 billion in loans from AIG and Morgan Stanley. AXA Financial Inc. sold the property in partnership with JPMorgan Chase & Co.; AXA first put the tower on the market last fall along with 787 Seventh Avenue, which has since been sold to CalPERS; one source noted that both properties had been "institutionally owned for decades," and would likely fetch around $4 billion because they have "institutional-quality tenants [with] high credit and the in-place market rents are significantly below market."

Located between 51st and 52nd Streets and also known as the Equitable Building, 1285 Avenue of the Americas is a Class-A mixed-use tower featuring office, retail, and storage. RXR Realty plans to upgrade the building's lobby, modernize the elevator mechanical systems and make improvements to the plaza. "We are excited to close on the acquisition of 1285 Avenue of the Americas and simultaneously execute a long-term renewal with UBS," said Scott Rechler Chairman and CEO of RXR Realty. "It is only fitting that one of the city's most prestigious buildings will remain the home to some of the city's most prestigious companies for decades to come." In addition to UBS, the building is co-anchored by law firm Paul Weiss Rifkind Wharton & Garrison LLP in 550,000 square feet and Omnicom Group affiliate BBDO, a marketing and communications firm, in 325,000 square feet.

For more news and information visit Blumberg Partners.

Pension Fund Sells Stake in Manhattan Tower for $341M

The California State Teachers' Retirement System (CALSTRS) recently sold its 65% stake in 120 Broadway to UBS Realty Investors for $341 million according to a Wall Street Journal report. The sale price marks a big profit for the pension fund as it originally acquired the asset for $240 million in 2004. The remaining 35% ownership of the property is held by developer Larry Silverstein. The building is currently 90% leased with major tenants including the New York State Attorney General and Bank of New York Mellon Corp.

The property, also known as the Equitable Building, is a 38-story skyscraper designed by Ernest R. Graham and finished construction in 1915; upon its completion, the building was the largest (in total floor area) in the world. After buying the building in 1980, Larry Silverstein had the building renovated and restored at a cost of $30 million, with renovations completed in 1990. As reported by the WSJ, the $155 billion California fund and Silverstein launched a partnership in 2006 to invest up to $2 billion in the tri-state area.

For more news and information visit Blumberg Capital Partners.