Top 10 US Office Sales of 2015
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You can mark 2015 down as an all-time record year for US office sales. Here are the top deals this year (so far) from our pals at Real Capital Analytics.
1. 11 Madison Ave, New York — $2.6B
Buyer: SL Green
Seller: CIM Group
SL Green's $2.6B purchase of 11 Madison Ave in August from the Saphire Group and minority partner CIM Group set the record as the largest single-building transaction in New York City history. The mega-deal also represented the second-highest price paid for a New York City office tower since the 2008 sale of the GM Building for $2.8B. 11 Madison Ave houses such marquee tenants as Credit Suisse, Yelp and Sony.
2. 1095 Sixth Ave, New York — $2.2B
Buyer: Ivanhoé Cambridge
Seller: Blackstone Group
Canada-based Ivanhoé Cambridge added to its already substantial US portfolio in January with the purchase of 1095 Avenue of the Americas from Blackstone Group in a JV with Callahan Capital Properties. The Art Deco Midtown property, also known as Three Bryant Park, is home to such A-list tenants as Verizon and MetLife.
3. 11 Times Square, New York — $1.4B
Buyer: Norges Bank
Seller: SLP Properties and Prudential Financial
The third-largest sale came in February when Norges Bank Investment Management bought a 45% interest in 11 Times Square from SJP Properties and Prudential Financial Properties in a deal valued at $1.4B. Home to Microsoft, the acquisition of this 40-story, 1.1M SF Midtown office tower was a deft move for the Norwegian sovereign-wealth fund, which has a market value of around $860B, and also has a $684M investment in nearby 7 Times Square. Norway is the biggest foreign buyer of American real estate after Canada with a US portfolio that also includes Washington and Boston.
4. 233 South Wacker Drive, Chicago — $1.3B
Buyer: Blackstone Group
Seller: The Feil Organization
Even though the $1.3B sale of the Willis Tower was just shy of projections, the final price of Chicago's tallest office building was still the highest price ever paid for an office tower outside of New York. According to the Chicago Tribune, the sale of the former Sears Tower to Blackstone Group also broke the Windy City's $850M record set by the sale of 300 N LaSalle in 2014. As we reported in June, Blackstone also paid $11.4M in state and local real estate transfer taxes when it completed the purchase.
5. 230 Park Ave, New York — $1.2B
Buyer: RXR Realty
Seller: Monday Properties and Invesco
No. 5 occurred in May when RXR Realty paid $1.2B for the 35-story former Helmsley Building at 230 Park Ave just three months after selling a large chunk of its portfolio to Blackstone Group. RXR is planning a series of upgrades to the 86-year-old structure located near Grand Central Terminal, including new office and retail space.
6. 1355 Market St, San Francisco — $900M
Buyer: J.P. Morgan Asset Management
Seller: Shorenstein Properties
Sixth on the list was a deal valued at $900M for J.P. Morgan Asset Management to recapitalize the 1.1M SF Market Square office and retail complex in San Francisco. According to The Registry, the transaction is expected to produce a cap rate of 4%. After acquiring the two-building property that houses Twitter for $110M in 2011, seller Shorenstein pumped another $350M into renovations and still retains a 2% share.
7. 200 East Randolph St, Chicago — $712M
Buyer: 601W Cos
Seller: Piedmont REIT
Another mind-blowing deal blew into the Windy City when Mark Karasick's 601W Cos purchased the 83-story Aon Center from Atlanta-based Piedmont Office Realty Trust for $712M in July. As Bisnow reported, bids on Chicago's third-largest skyscraper were valued at over $650M before the sale was announced.
8. 701 Fifth Ave, Seattle — $711M
Buyer: Gaw Capital Partners
Seller: Beacon Capital Partners
Hong Kong-based Gaw Capital's purchase of Seattle's 76-story, 1.5M SF Columbia Center for $711M is another example of just how attractive the Pacific Northwest has become for Asian institutional investors. The sale of Seattle's tallest office tower was completed in August and ranks as one of the biggest real estate transactions in the region's history.
9. 26 Landsdowne St, Cambridge, MA — $573.5M
Buyer: Forest City Enterprises
Seller: Healthcare REIT
In June, Forest City Enterprises completed its previously announced share purchase to acquire Health Care REIT's 49% equity interest in seven life-science office properties and two parking facilities at MIT's University Park. Prior to the $573.5M sale, Forest City and Healthcare REIT had co-owned the Cambridge, MA, complex in a JV since 2010.
10. America's Square, Washington, DC — $508M
Seller: Dweck Properties
Ladies and gentlemen, your new DC record-holder for an office sale. German investment fund Jamestown paid $1,101/SF with a cap rate of 4.3% for these two buildings a stone’s throw from the US Capitol. It's just the second building in DC history to trade for more than $1,000/SF.