Innovo’s $855M Deal For Fifth Avenue Tower Hits Financing Snag
Andrew Chung’s attempt to buy the HSBC Tower on Fifth Avenue is reportedly on thin ice because his company hasn't yet locked down financing for the purchase.
Chung’s Innovo Property Group reached a deal last year to buy the 30-story tower at 452 Fifth Ave. for $855M, but a filing with the Tel Aviv Stock Exchange shows the company hasn't locked down financing, Commercial Observer reports.
The deadline to close the deal is Monday, according to CO, which reported that the parties are still negotiating — the building is still owned by Israeli real estate firm Property and Building Corp. — but a deal is unlikely to close in time. PBC is shifting to reinvest in Israel and in December listed $2B worth of American property on the market, The Real Deal reported.
Earlier this month, HSBC announced it is moving its headquarters from the property to Tishman Speyer’s The Spiral in Hudson Yards, leaving behind a 548K SF hole at its 895K SF namesake. HSBC's upcoming vacancy, along with the jump in interest rates, has caused delays and problems in Innovo's search for acquisition financing, TRD reports.
The holdup of this deal could have ripple effects for PBC, with its plans to buy a majority stake in Israeli real estate firm Bayside Land Corp. possibly affected by a stalled deal.
Innovo, which is partly backed by Nan Fung Group, has made a name for itself developing last-mile logistics facilities in New York's outer boroughs. The HSBC Tower would be its first Manhattan skyscraper acquisition.