$1.65bn Midtown trophy tower deal closes

A group of investors including China Life Insurance Company, RXR Realty and David Werner have completed the $1.649 billion purchase of 1285 Avenue of the Americas in one of the priciest office building transaction in New York City this year, city property records confirm.

A group of investors including China Life Insurance Company, RXR Realty and David Werner have completed the $1.649 billion purchase of 1285 Avenue of the Americas in one of the priciest office building transaction in New York City this year, city property records confirm. 

dsc06226American International Group and Morgan Stanley provided $1.2 billion in financing on the acquisition, which equates to a nearly 73 percent loan-to-value. The seven-year loan was arranged by Meridian Capital Group.

The 39-story, 1.8 million sq ft, class-A trophy office tower occupies the full block of Avenue of the Americas between West 51st Street and West 52nd Street and includes 24,600 sq ft of retail space and 84,000 sq ft of below grade space.

RXR signed a contract to buy the building from JP Morgan Asset Management and AXA Financial back in December as the firm, one of the largest owners and developers of property in the Tri-State (New York, New Jersey and Connecticut) area  continued to negotiate, prior to closing, a deal with UBS to extend that bank’s lease on 900,000 sq ft of space in the 1.8 million sq ft building through 2032. The property also serves as the North American headquarters for UBS, the global headquarters for Paul Weiss and the global headquarters for BBDO.

China Life is the country’s largest insurer and also one of its largest cross-border real estate investors. Last year the company formed a partnership with Global Logistic Properties and two other Asian institutional investors, to acquire a US logistics portfolio valued at approximately $4.5 billion from Industrial Income Trust, real estate investment trust (REIT). China lifted restrictions on its insurance companies buying foreign property in 2012, leading to an aggressive ramp up on overseas acquisitions.

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