United Overseas Bank Takes Over Landmark Midtown Tower
In the latest signal of the end of commercial real estate's extend-and-pretend era, a storied office building in Midtown Manhattan is now in the hands of a bank.
Singapore-based United Overseas Bank has acquired the Bush Tower, a 29-story landmarked office building at 130 W. 42nd St., from owner Vanke US, the American affiliate of Shenzhen-based China Vanke, in a transaction valued at $58.1M, property records show.
United Overseas Bank’s takeover comes at half of the value of its $120M loan to Vanke from 2018. The lender plans to sell the property, PincusCo reported.
Vanke will continue managing the building for the lender, a spokesperson told Bisnow in a statement.
“After working collaboratively with our lender, we have reached a mutually agreed outcome that we believe is in the best interests of all stakeholders,” the spokesperson said. “This transaction reflects a proactive, disciplined approach in light of current U.S. market conditions and allows us to focus additional time and resources on other strategic priorities across our U.S. portfolio.”
United Overseas Bank didn't immediately respond to a request for comment.
The building, which sits opposite Bryant Park and steps from some of the city’s premier office towers, is home to Vanke’s U.S. operations, according to the company’s website. Midtown-based American Properties owns the land under the building.
The Bush Tower, designed by Helmle & Corbett, was built in 1918 for oil executive Irving T. Bush, the namesake of Bush Terminal in Brooklyn's Sunset Park. The neo-Gothic building was designated a city landmark in 1988 by the Landmarks Preservation Commission, which wrote it “represents an important intermediate stage in the development of the skyscraper.”
In 2015, Vanke, then China’s largest publicly traded developer, forked over $125M for a majority stake in the 218K SF tower, The Real Deal previously reported.
Tribeca Associates and Meadow Partners had paid roughly half that amount to lease the building two years earlier. Tribeca Associates is still named on Vanke’s website as its partner on the property.
It was once home to a WeWork outpost following a 64K SF lease in 2017 but became one of the properties shed by the coworking company during its 2024 bankruptcy restructuring. Home care solutions company HHAeXchange signed a lease last year to relocate its 10K SF office from the building to a bigger space on Sixth Avenue, the New York Business Journal reported.
The deal is the latest example of a lender swallowing a loss on loans handed out to office buildings before the pandemic as the extend-and-pretend era comes to a screeching halt.
Earlier this week, Capstone Equities acquired a boutique SoHo office building from developers Madison Capital and Vornado Realty Trust for $51M after acquiring the building's $75M mortgage, which was originated in 2019.
Investors acquired 133 distressed offices in 2024, but that number shot up to 204 last year, The Wall Street Journal reported last month, citing MSCI data.
Those property sales — achieved through bankruptcy auctions or foreclosure sales — came to a total of $5.2B.
But lenders have taken serious hits to get the problematic loans off their books: Some building values fell by as much as 85% in the series of takebacks, Bloomberg reported this month.
Still, new owners are finding an upside. Some are planning residential conversions in the properties, leaning on tax breaks like 476-m after acquiring the buildings at steep discounts.
