Saudi Arabia’s Public Investment Fund is reportedly taking a two-thirds stake in Related Cos.’ planned 1,200-foot skyscraper at 625 Madison Ave.

The $1T sovereign wealth fund has already invested $200M in the development, though its final contribution has yet to be determined, The Wall Street Journal reported.

Related purchased the site, which sits just a block away from Central Park, last year for $630M. It is tearing down the office building that has stood between East 58th and 59th streets since it was built in 1956 to serve as Nabisco's headquarters and also once served as Related's headquarters.

The final cost of the project is expected to exceed $1B. A 68-story mixed-use supertall with condos and a hotel was originally planned for the lot, but the firm said it has more recently considered building an office tower on the site because of the demand for trophy space in Manhattan, according to the WSJ.

In the first half of the year, Manhattan office leasing activity outpaced three of the four years before the pandemic, according to CoStar Analytics. A total of 15.8M SF has been scooped up, a 14% increase from last year.

Much of that has been consolidated in premium space. All of the top 10 largest new leases were signed in 4- and 5-star buildings, with availability in the highest-end office assets dropping from 17% to just over 10% since early 2023.

Related has capitalized on that demand by starting construction on the largest ground-up office tower in the U.S. since the start of the pandemic. It has broken ground on 70 Hudson Yards after luring Deloitte to sign an 800K SF prelease.

The Saudi fund has worked closely with Related prior to its investment in 625 Madison. In 2020, the PIF made a debt investment in Related that is convertible into a 15% equity stake, according to the WSJ.

The PIF is also one of many foreign investors making their way back into New York City. In the first quarter of 2025 and the fourth quarter of 2024, overseas investors bought more than $2.1B of Manhattan commercial real estate. That’s five times more than the same six-month period two years earlier, the WSJ reported, citing data from MSCI.

The five-block stretch around Related’s site has become especially popular among developers. 625 Madison is a block away from Extell’s potential luxury supertall at 655 Madison Ave. and the former Barney’s store at 660 Madison Ave., where Ashkenazy Acquisition Corp. is hoping to lure a billion-dollar buyer. It’s also near 590 Madison Ave., which RXR is under contract to purchase for $1.1B.