Another would-be buyer of the HSBC Tower has failed to close on the deal after it could not secure acquisition financing, making it the latest casualty in the tough capital markets environment.

Israel’s Property and Building Co. had reached a deal to sell 452 Fifth Ave. in Manhattan to an unnamed buyer, according to a filing on the Tel Aviv stock exchange. The deal fell through because the buyer couldn't secure financing, according to CoStar, which first reported the filing.

It is the second time in two years a deal to sell the 30-story building, which has long served as HSBC's U.S. headquarters, has fallen apart. In 2021, Andrew Chung’s Innovo Property Group reached an agreement to buy the 30-story tower for $855M. But by May last year, a filing with the Tel Aviv Stock Exchange showed the company was not able to lock down financing, and the sale was called off.

Property and Building Corp. instead refinanced the 865K SF  property with a $385M loan from JPMorgan Chase at an interest rate of 3.9%, The Real Deal reported. The loan matures in September 2024 and has two one-year extension options, CoStar reported.

HSBC has a lease for more than 570K SF at the property until 2025, after which time it will shrink its footprint to 265K SF and relocate to Tishman Speyer’s The Spiral building near Hudson Yards.

With this second possible sale now off the table, Property and Building Co. will try to find a new buyer and look at finding a new tenant for the property, it said in the filing. It had reached an agreement with the buyer last year, but after a 60-day exclusivity period and a 30-day extension, no deal was struck.

The financing environment is particularly tough at the moment, after last year’s sudden interest rate hikes.

For the last 12 months, deals have been stalled and in some cases called off, brokers say, as a sense of uncertainty has spread across the market.

“There's a real distinction between a hotel deal and an office deal right now,” KKR Managing Director for Real Estate Paul Fine said a Bisnow event last month. "I don't know that any of us have ever seen an asset class become effectively un-investable overnight."

Landlords of buildings with vacancy or impending departures are starting to show their distress. Columbia Property Trust defaulted on $1.7B of loans last month backing seven buildings, four of which are in Manhattan. Brookfield said in a filing this week its office portfolio had lost $825M in value and it had suspended repayments on over $1B worth of properties, which is less than 2% of its portfolio.