Bertelsmann Building at 1540 Broadway sold for $820M.

In one of New York City's most significant office tower sales of 2006, Manhattan-based Paramount Group, Inc., in a joint venture with Principal Real Estate Investors, has closed on the sale of 1540 Broadway, the renowned Times Square skyscraper commonly known as the Bertelsmann Building.

Paramount acquired the property two years ago. Equity Office and Vornado Realty Trust purchased the building in two separate transactions for a total of $820 million.

The 44-story, 1.1-million-s/f office and retail property occupies the entire easterly blockfront between 45th and 46th Streets. The office portion of the building is nearly 97% occupied.

"Though we tend to be long-term investors, we saw an opportunity to leverage the demand for Times Square office properties and offered 1540 for purchase," said Paramount Group President & CEO Albert Behler. "The sale happened very quickly. Paramount intends to re-invest its profits in the Paramount Group Real Estate Fund by acquiring additional Class A, CBD-located office properties throughout the United States."

Paramount Group launched its real estate investment funds in late 2003--attracting domestic and overseas investors--for the purpose of expanding its portfolio of prime office properties in major U.S. cities. To date, the funds have acquired assets in Washington, D.C., San Diego and Manhattan.

The property was marketed by Eastdil Secured on behalf of Paramount Group and Principal Real Estate Investors.