Related, Oxford Secure $1.3B Financing on 15 Hudson Yards

Related Companies and Oxford Properties Group closed $1.3 billion in financing to fund the 15 Hudson Yards building under construction in the mixed-use development on Manhattan's West Side. The finance package includes equity provided by Related, Oxford and a sovereign wealth fund, tax-exempt bonds from New York State Housing Finance Agency and an $850 million construction loan provided by London-based The Children's Investment Fund, according to a Commercial Observer report.

The 960,000 square foot mixed use tower was designed by Diller Scofidio + Renfro and Rockwell Group to obtain LEED Gold certification, and is expected to be completed in 2018, with sales to begin next year. The 70-story tower will offer unobstructed views of the city and Hudson River, and immediate access to the greater Hudson Yards project, which includes 17 million square feet of commercial and residential space, more than 100 shops and restaurants, including the first Neiman Marcus in New York City, approximately 5,000 residences, 14 acres of public open space, a new 750-seat public school and a 200-room, Equinox-branded luxury hotel.

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New York's Hudson Yards Skyscraper Breaks Ground

Mitsui Fudosan America Inc. (MFA), the U.S. operations of Japan's largest real estate company, along with Related Companies and Oxford Properties Group broke ground this week on the trophy office tower at Fifty Five Hudson Yards on Hudson Park & Boulevard. The skyscraper is the latest addition to the 28-acre Hudson Yards development, and represents a new trophy property in the expanding portfolio of global real estate leader Mitsui Fudosan Group.

"We are pleased to partner with Related Companies and Oxford Properties Group on Fifty Five Hudson Yards which we consider a new trophy property in the Mitsui Fudosan U.S. and global portfolios," said Yukio Yoshida, President and CEO of MFA. "Related and Oxford are experienced developers with a proven track record for delivering world class projects, making them ideal partners. Hudson Yards is fast becoming one of the most desirable locations for top echelon tenants, offering an unparalleled modern, mixed-use environment. We are looking forward to being a central part of the success of the Hudson Yards development."

"We are thrilled to partner with Mitsui Fudosan America and commence construction on Fifty Five Hudson Yards. Mitsui Fudosan is one of the worlds' most established real estate developers and investors and their partnership on this project further solidifies the appeal of Hudson Yards with both global capital and global companies," added Stephen Ross, Chairman and Founder of Related Companies. "Hudson Yards is already the future home of Coach, Inc., L'Oréal USA, SAP and Time Warner Inc. and we have seen incredibly strong interest in Fifty Five Hudson Yards. Featuring the best in culture, dining, shopping and more, the commercial office space, steps from transportation and lush, expansive green space, Hudson Yards sets a new standard for working in New York City."

Blake Hutcheson, CEO of Oxford Properties Group, said, "The forward momentum at Hudson Yards is evident to everyone who walks by the development. Oxford is pleased to join Related in partnering with Mitsui Fudosan and commencing construction on Fifty Five Hudson Yards. Each organization has deep experience and incredible portfolios of past developments and investments individually, and this new partnership will benefit from bringing the three together for the first time."

Designed by A. Eugene Kohn and Kohn Pedersen Fox Associates (KPF), the fully capitalized, anticipated LEED Gold, 51-story, 1.3 million gross square foot building is expected to be ready for tenant fit-out in 2017. "Simple in form, but rich in detail, the building was inspired by the historic cast iron architecture found throughout SoHo, and aims to relate to the neighborhoods of Chelsea and the Meatpacking District adjacent to Hudson Yards," said A. Eugene Kohn, Chairman of KPF and Design Architect of Fifty Five Hudson Yards. "Fifty Five Hudson Yards was designed to create an extremely workable and efficient office building which is suitable for a variety of tenants both large and small."

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Blackstone To Sell Five Boston Towers for $2.1B

Oxford Properties Group, the property investment arm of the Ontario Municipal Employees Retirement System (OMERS), is leading a consortium of buyers that has agreed to buy five high-rise office towers in Boston, MA from Blackstone Group for about $2.1 billion. According to a Boston Globe article, Blackstone originally acquired the properties when it bought Equity Office Properties Trust, a landlord built by the Chicago real estate magnate Sam Zell, for $39 billion in 2007. Oxford Properties oversees about $20 billion of assets it manages for itself and on behalf of partners. Other bidders on the Boston portfolio reportedly include the Government of Singapore, and a joint venture of Norway's sovereign wealth fund and MetLife Inc.

As part of the agreement, Oxford would buy all of 100 High St. and 125 Summer St., according to a Wall Street Journal report. Oxford intends to partner with the asset management arm of J.P. Morgan Chase & Co. to buy three towers: 60 State St., 225 Franklin St. and One Memorial Dr. in neighboring Cambridge. The five-building portfolio totals almost 3.3 million square feet and are properties mostly in downtown Boston.

Blackstone Group is also selling its ownership stake in another Boston building in the portfolio, Rowes Wharf, to Morgan Stanley, which is its partner in the building.

For more news and information visit Blumberg Capital Partners.

Oxford Properties Buys 450 Park Avenue for $575M

Oxford Properties Group, the real estate arm of the Ontario Municipal Employees Retirement System (OMERS), announced this week that it had agreed to pay $575 million for 450 Park Avenue. Somerset Partners and the Michael Tabor family trust, which has owned and operated the building since 2007, sold the 33-story building to Oxford; terms of the deal were not disclosed. According to a New York Times article, the sale is one of the highest prices ever paid for a Manhattan office building at over $1,700 per square foot.

"We felt comfortable investing a large amount of cash in this quality location and asset," Keith Rubenstein, a Somerset founder, said in an e-mail to Bloomberg. "The thinking back then was this location was bulletproof, would withstand any downturn in the market and value would recover faster. Looking back, I guess we were right."

"A lot of pension funds, Asian companies, sovereign funds and other investors are increasing their allocations for real estate," said Douglas Harmon of Eastdil Secured, the broker on the Park Avenue deal. "If you do that, the first place you want to be is Manhattan."

Formerly known as the Franklin National Bank building, 450 Park Avenue was built in 1972 by Emery Roth and Sons and renovated in 2007 when Somerset Partners purchased the property for $509 million. As noted by the NYT, Oxford is betting that the property will become more valuable when the developer Harry Macklowe completes the tallest residential tower in the Western Hemisphere, a 1,398-foot skyscraper next door at 432 Park Avenue.

For more news and information visit Blumberg Capital Partners.

Time Warner Sells Manhattan HQ for $1.3B to Related Cos.

Time Warner Inc. announced this week that it had sold its 1.1 million square foot headquarters building in Manhattan for $1.3 billion to a venture of Related Companies, an entity owned by the Abu Dhabi Investment Authority (ADIA) and GIC in a sale-leaseback deal. While Time Warner will continue to lease its current office space until early 2019, the company has plans to relocate to 30 Hudson Yards in the office development by Related and Oxford Properties Group, expecting to acquire more than one million square feet and occupy the space by the end of 2018. Eastdil Secured's Douglas Harmon, Adam Spies and Kevin Donner represented Time Warner in the transaction with the Abu Dhabi fund. Studley is representing Time Warner and CBRE is representing Related and Oxford with respect to Time Warner's planned acquisition of space in Hudson Yards for its new corporate headquarters.

"We see significant upside in leasing the high quality office space following Time Warner Inc.'s planned relocation to 30 Hudson Yards. We believe strong demand for this first-rate office property will translate into a stable income stream which suits GIC as a long-term investor," said Tia Miyamoto, regional head of Americas at GIC Real Estate. "Time Warner Center is one of the premier mixed-use projects in the country."

Oxford Chief Executive Officer Blake Hutcheson said, "Time Warner has shown incredible vision not only in its core business of storytelling, but also in its commitment to establishing a collaborative and creative space. We are very excited to partner with Time Warner alongside Related, and to deliver a business community in which Time Warner will simply thrive."

Time Warner Center is a 2.8 million-square-foot mixed-use complex at the southwest corner of Central Park, which, in addition to office and flex space, also houses a Mandarin Oriental hotel, Jazz at Lincoln Center and some of the city's most expensive condominiums. The long-anticipated Time Warner Center purchase works out to about $1,182 per square foot, according to a CoStar report.

For more news and information visit Blumberg Capital Partners.

Oxford, Crown Purchase Interest in Olympic Tower with $250M Wells Fargo Loan

A joint venture between Oxford Properties Group, the real estate arm of the OMERS Worldwide Group of Companies, and Crown Acquisitions Inc. announced a joint acquisition of a "significant interest" in New York's Olympic Tower. The JV purchased the interest in the Midtown property from Williston SA, a company controlled by the Alexander S. Onassis Foundation. According to a Commercial Real Estate Direct report, Wells Fargo provided the $250 million loan against the 500,000-square-foot Olympic Tower mixed-use complex on Fifth Avenue in Manhattan. The fixed-rate loan was used to refinance a $250 million mortgage that had been provided by Deutsche Bank earlier this year.

"The acquisition of Olympic Tower is consistent with Oxford's U.S. investment strategy," said Blake Hutcheson, President and CEO, Oxford Properties Group. "We seek large scale, world class mixed use assets with long term partners and we are very excited to join Crown Acquisitions and the Onassis Foundation in this exceptional opportunity. We believe in New York, We believe in this real estate and we believe in our partners."

Anthony Papadimitriou, president of the Alexander S. Onassis Foundation, said: "This partnership will enhance the positioning of our retail and office interests along Fifth Avenue and will most certainly add value over time. This transaction falls within our strategy of diversification of our real estate portfolio and I look forward to working with Crown and Oxford."

For more news and information visit Blumberg Capital Partners.