The $500M+ Office Era

2013 will go down in history. By the next time you're counting backward from 10 with a champagne glass in hand (wearing sunglasses that miraculously fit two eye holes within the number 2014), 11 office buildings will have traded for $500M or more. Seacrest out.

NGKF's Jonathan Mazur, snapped in his office yesterday, tells us five have already closed, and six more are expected to by the end of the year. That's the same number as in 2006, as well as 2011, which captured the pent-up Great Demand from the Great Recession. 2012 was a good year for office trades, he tells us, but the big deals just weren't there. Of course, 2007 (20 deals over $500M) was too good to be true. Though this year's office stock for sale has benefited from residential conversion opps, only one of this year's pending big sales is likely to follow suit (our Magic 8-Ball tells us it's 650 Madison). That means Q4 belongs to pure office plays.

Source: Newmark Grubb Knight Frank

Jonathan recently joined NGKF from C&W to launch a capital markets research platform. He also says enough half billion-dollar buildings are for sale now (mostly Class-A and B in Midtown) to add up to a similar '14. The buyers for all these mega deals? Some private companies and some REITs, he says. The private firms typically have finite hold periods, so keep on eye on the 2020s. (Isn't that also the Mets' new motto?)

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