(Mark your Calendars: RealShare NEW YORK at the Marriott Marquis on October 12.)
NEW YORK CITY-Investment and management firm Paramount Group, Inc. has recapitalized a 49% interest in its 48-story, class A office tower at 1633 Broadway in Midtown after affiliates of Morgan Stanley and Bank of America Merrill Lynch exited the partnership in the building. Paramount’s new partners in the property include affiliates of Beacon Capital Partners, LLC and Paramount Group’s Real Estate Fund IV. In addition, SL Green Realty Corp. acquired a preferred equity interest as well.
Dan Lauer, vice president of acquisitions at Paramount Group, tells GlobeSt.com that Paramount Group Real Estate Fund I retains its 51% controlling interest in the 2.5 million-square-foot tower, but declined to disclose specifics, citing confidentiality agreements. “We took our interest in the property from 51% to about 75%,” Lauer says, who represented Paramount in-house on the deal, along with Steve Kohn at Cushman & Wakefield. “SL Green is making a preferred equity investment and Beacon is acquiring the remaining limited interest in the property.”
Again citing confidentiality agreements, Lauer could not disclose the value of the building, but a market report from Massey Knakal Realty Services lists a partial interest of 1633 Broadway at $980 million, while Real Capital Analytics ranks the entire tower at $2 billion total. Tenants in the building include Allianz, Time Warner, Deloitte LLP, Morgan Stanley, Dickstein Shapiro and Kasowitz, Benson, Torres & Freedman LLP.
In a statement, Albert Behler, president & CEO of Paramount Group, says the firm enjoyed a “long and successful partnership” with the real estate teams at Morgan Stanley and Bank of America, but looks forward to the new venture. “We are very excited about the future of 1633 Broadway and our new partners, who are sophisticated, highly respected real estate investors,” he says.
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