Bertelsmann sold for $820m.The Paramount Group and its joint venture partner, Principal, have sold the Bertelsmann Building at 1540 Broadway for $820 million, realizing a $400 million profit from its mid-2004 acquisition of the asset. The firm has entered into an agreement to sell the 900,000 s/f office portion of the building to Equity Office Properties and Lehman Brothers Lehman Brothers Holdings Inc. (NYSE: LEH), founded in 1850, is a diversified, global financial services firm. It is a participant in investment banking, equity and fixed income sales, research and trading, investment management, private equity, and private banking. for $560 million. The office portion of the building is close to full with Viacom and Bertelsmann as the primary tenants. Vornado announced it would pay $260 million for the remaining 152,000 s/f of retail space, signage and parking components at the Times Square tower. The retail space is currently 60% occupied by Virgin Records and Planet Hollywood. "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 and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. 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 United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. ." Paramount Group launched its real investment funds Noun 1. investment funds - money that is invested with an expectation of profit investment assets - anything of material value or usefulness that is owned by a person or company 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 San Diego (săn dēā`gō), city (1990 pop. 1,110,549), seat of San Diego co., S Calif., on San Diego Bay; inc. 1850. San Diego includes the unincorporated communities of La Jolla and Spring Valley. Coronado is across the bay. and Manhattan. It beat out bids from, among others Jamestown, SL Green and Equity Office Properties to buy 1540 from Bertelsmann for $425 million in January 2004. Its Manhattan portfolio currently includes 900 Third Avenue, 1633 Broadway, 1177 and 1325 Avenue of the Americas, 712 Fifth Avenue, 745 Fifth Avenue and Financial Square. Vornado declined further comment on the sale until the deal closes in the third quarter. Equity also declined comment, however, the purchase is well in line with its strategy of targeting high-quality buildings with unusual upside potential Upside potential The amount by which analysts or investors expect the price of a security may increase. upside potential The potential price or gain that may be expected in a security or in a security average, generally stated as the dollar . In 2003, the REIT REIT See: Real Estate Investment Trust REIT See real estate investment trust (REIT). paid $353 million for 717 Fifth Avenue and last year paid $505 million for the Verizon building. With midtown vacancy hovering at equilibrium, the one million square feet currently being renovated there in a $200 million capital improvement, can't come quick enough. The 1540 Broadway building was marketed by Eastdil Secured's Doug Harmon. |
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