Norges Bank Investment Management and Beacon Capital Partners have entered an agreement to buy 1177 Sixth Ave. in a transaction that values the office tower at $571.1M.
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Under the deal, Norges, the world's largest sovereign wealth fund, is taking a 95% ownership interest in the property, it announced Tuesday. Boston-based Beacon will acquire a 5% stake and will manage the asset on behalf of the partnership.
A joint venture between the California State Teachers’ Retirement System and Silverstein Properties has owned the 47-story, 1M SF Midtown property since 2007, when they paid more than $1B to acquire it.
Silverstein and CalSTRS acquired UBS' stake in the property in 2021 in a deal that valued the building at $860M, The Real Deal reported at the time.
The sale at less than $600M means Norges is taking over the asset at a significant discount. Silverstein and CalSTRS have a $450M mortgage from Wells Fargo and Deutsche Bank tied to the property.
The deal is an all-cash transaction, Commercial Observer reported, citing anonymous sources. It is expected to close in the third quarter, according to Norges.
Eastdil Secured’s Gary Phillips, Will Silverman, Sarah Lagosh and Alana Bassen negotiated the sale.
The office tower, located on the corner of West 45th Street and Sixth Avenue, has scored several new tenants in recent months. That includes investment firm Starr, which inked a 49K SF lease in May. Law firm Kramer Levin is the building's largest tenant, with roughly 280K SF.
1177 Sixth Ave. is the latest Manhattan office building to be sold by a pension fund in recent months.
The State Teachers Retirement System of Ohio executed the first billion-dollar office sale in recent years, selling 590 Madison Ave. to a joint venture of RXR and Elliott Investment Management for nearly $1.1B.
Taconic Partners and Nuveen Real Estate, the property arm of the Teachers Insurance and Annuity Association of America, offloaded 440 Ninth Ave. for a $169M price cut last month, Bloomberg reported.
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