Fresh off the acquisition of a 45 percent stake in Boston Properties’ 601 Lexington Avenue, the sovereign fund that manages Norway’s substantial oil wealth is making a play for Blackstone Group’s 1095 Sixth Avenue, according to a source familiar with the talks. A deal for the tower, expected to fetch up to $2.25 billion, would be the biggest office tower sale in New York since the GM Building traded hands in 2008.
Norges Bank Investment Management is gunning to buy the 42-story, 1.2 million-square-foot tower, which is located between 41st and 42nd streets and overlooks Bryant Park, a source with knowledge of its moves told The Real Deal. It’s also interested in buying into two Boston Properties’ assets in Boston: a 37-story office tower at 100 Federal Street and a 31-story office tower in the Atlantic Wharf complex.
The $5.6 trillion fund, which is associated with nearly $14 billion in total property acquisitions over the last decade, was given a mandate in 2010 to invest up to 5 percent of its assets in real estate outside Norway, according to Real Capital Analytics.
Blackstone acquired 1095 Sixth in 2007, as part of its $39 billion purchase of Sam Zell’s Equity Office Properties Trust. The building, which is 99 percent leased, is anchored by insurance giant MetLife, and Verizon Communications recently reestablished its headquarters there. Whole Foods is also taking about 32,000 square feet at the building.
Besides its investment in 601 Lexington, Norges’ recent Manhattan investments include a $684 million stake in Boston Properties’ 7 Times Square and an investment in 470 Park Avenue South, Real Capital data show. If Norges manages to acquire the tower, the move would be in line with some of these recent deals, according to Ben Thypin, Real Capital’s director of market analysis.
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Ben Carlos Thypin
I am currently the co-founder of Quantierra, the world's first data driven real estate brokerage and investment manager. In my former life as Director of Market Analysis at Real Capital Analytics, I worked with press outlets large and small to provide them with great data and insightful commentary. Here are some of the results of this collaboration. For the rest, please check out the News Archive.