New York, NY (June 2, 2016) – NorthStar/RXR New York Metro Real Estate, Inc. (NorthStar/RXR) announced today that it made its initial investment by acquiring an indirect minority interest in 1285 Avenue of the Americas, a commercial office building in midtown Manhattan, for a purchase price of approximately $1.9 million. The acquisition was part of an approximately $1.65 billion transaction sourced by RXR Realty, LLC (RXR Realty), NorthStar/RXR’s co-sponsor and affiliate of its sub-advisor. NorthStar/RXR completed the acquisition through a limited partnership structure.
Property highlights include:
- 1.8 million square foot, 39-story, Class-A office building with approximately 25,000 square feet of retail space and 84,000 below-grade square footage
- Currently 99% leased to high quality tenants, including operating as the North American headquarters for UBS AG (UBS), and the global headquarters for both BBDO Worldwide, Inc. (a division of Omnicom Group) and law firm Paul, Weiss, Rifkind, Wharton & Garrison LLP
- Centrally located in Manhattan’s Sixth Avenue and Rockefeller Center corridor, a leading office submarket comprised of approximately 45 million square feet of office space
- Offers underground access to Rockefeller Center concourse and close proximity to multiple public transit lines
Highlights of RXR Realty Value-Add Strategy:
- UBS, one of the world’s largest wealth managers, agreed to a long-term lease extension, securing their occupancy in approximately 890,000 square feet of space through June 2032. RXR Realty had been working with UBS on the extension since December 2015, when RXR Realty agreed to purchase the property.
- RXR Realty plans to upgrade the building’s lobby, modernize the elevator mechanical systems and make improvements to the plaza.
“This was a very large, complex agreement and with the close of the $1.65 billion acquisition, RXR Realty has completed one of the largest office building transactions in New York City so far this year,” remarked Scott Rechler, Chairman and CEO of RXR Realty and Co-Chairman of NorthStar/RXR. “We were able to ensure that one of the city’s most prestigious buildings will remain the home to some of the city’s most noteworthy companies for decades to come.”
Daniel R. Gilbert, Co-Chairman, Chief Executive Officer and President of NorthStar/RXR commented, “We are pleased to announce our initial investment in a prominent property like 1285 Avenue of the Americas. This acquisition is representative of our sub-advisor’s ability to identify and execute high-quality, value-add investments in the New York metropolitan area and the lease extension of UBS reflects their ability to realize value in challenging circumstances. As NorthStar/RXR’s portfolio develops, we are confident that we may capitalize on similar compelling opportunities that are consistent with our investment strategy.”
NorthStar/RXR is structured as a public, non-traded company that intends to qualify as a real estate investment trust (REIT) and is co-sponsored by NorthStar Asset Management Group Inc. and RXR Realty. NorthStar/RXR was formed to create a balanced portfolio of high-quality commercial real estate and value-add investment opportunities in the New York metropolitan area.