NEW YORK — Paramount Group Inc. (NYSE: PGRE) has agreed to acquire the remaining 35.8 percent ownership interest in 31 W. 52nd St. in New York City from its joint venture partner for approximately $230 million in cash. The acquisition is expected to be completed in the fourth quarter of 2015.
The 29-story, 786,647-square-foot office building is located between Fifth Avenue and Avenue of the Americas in Midtown Manhattan. Paramount Group originally purchased the asset in late 2007 from Hines, Deutsche Bank and RREEF for $595 million, according to media reports. The company declined to name its joint venture partner.
“The acquisition of the remaining ownership interest in this distinctive trophy asset offers Paramount an outstanding opportunity to execute on our embedded growth strategy,” says Albert Behler, chairman, CEO and president of Paramount Group. “We believe full ownership of the property is in the best long-term interests of our shareholders, as we continue to focus our efforts on driving NOI [net operating income] growth through strategic and creative leasing and other key initiatives.”
The property is currently leased to a number of high-profile tenants including Clifford Chance, Toronto-Dominion Bank, Morgan Stanley, Centerview Partners and an upscale steakhouse, Fogo de Chao. The property offers views of Central Park and Rockefeller Center and features a large public plaza connecting 52nd and 53rd streets and a 120-space parking garage. Five subway lines are located within three blocks of the building and numerous hotels, museums and retail stores are also located nearby.
Headquartered in New York City, Paramount Group is a real estate investment trust (REIT) that owns, operates, manages, acquires and redevelops Class A office properties in New York City, San Francisco and Washington, D.C. As of June 30, Paramount Group’s portfolio consisted of 12 Class A office properties aggregating approximately 10.4 million square feet that was 94.8 percent leased.
The REIT’s stock price closed on Wednesday, Sept. 9 at $15.79 per share, down from $18.18 per share on Nov. 19, 2014, when the company launched its initial public offering.
— John Nelson