NEW YORK, June 1, 2016 /PRNewswire/ -- NorthStar/RXR New York Metro Real Estate, Inc. (NorthStar/RXR) announced today that it made its initial investment by acquiring an indirect minority interest in 1285 Avenue of the Americas, a commercial office building in midtown Manhattan, for a purchase price of approximately $1.9 million. The acquisition was part of an approximately $1.65 billion transaction sourced by RXR Realty, LLC (RXR Realty), NorthStar/RXR's co-sponsor and affiliate of its sub-advisor. NorthStar/RXR completed the acquisition through a limited partnership structure.
Property highlights include:
- 1.8 million square foot, 39-story, Class-A office building with approximately 25,000 square feet of retail space and 84,000 below-grade square footage
- Currently 99% leased to high quality tenants, including operating as the North American headquarters for UBS AG (UBS), and the global headquarters for both BBDO Worldwide, Inc. (a division of Omnicom Group) and law firm Paul, Weiss, Rifkind, Wharton & Garrison LLP
- Centrally located in Manhattan's Sixth Avenue and Rockefeller Center corridor, a leading office submarket comprised of approximately 45 million square feet of office space
- Offers underground access to Rockefeller Center concourse and close proximity to multiple public transit lines
Highlights of RXR Realty Value-Add Strategy:
- UBS, one of the world's largest wealth managers, agreed to a long-term lease extension, securing their occupancy in approximately 890,000 square feet of space through June 2032. RXR Realty had been working with UBS on the extension since December 2015, when RXR Realty agreed to purchase the property.
- RXR Realty plans to upgrade the building's lobby, modernize the elevator mechanical systems and make improvements to the plaza.
"This was a very large, complex agreement and with the close of the $1.65 billion acquisition, RXR Realty has completed one of the largest office building transactions in New York City so far this year," remarked Scott Rechler, Chairman and CEO of RXR Realty and Co-Chairman of NorthStar/RXR. "We were able to ensure that one of the city's most prestigious buildings will remain the home to some of the city's most noteworthy companies for decades to come."
Daniel R. Gilbert, Co-Chairman, Chief Executive Officer and President of NorthStar/RXR commented, "We are pleased to announce our initial investment in a prominent property like 1285 Avenue of the Americas. This acquisition is representative of our sub-advisor's ability to identify and execute high-quality, value-add investments in the New York metropolitan area and the lease extension of UBS reflects their ability to realize value in challenging circumstances. As NorthStar/RXR's portfolio develops, we are confident that we may capitalize on similar compelling opportunities that are consistent with our investment strategy."
NorthStar/RXR is structured as a public, non-traded company that intends to qualify as a real estate investment trust (REIT) and is co-sponsored by NorthStar Asset Management Group Inc. and RXR Realty. NorthStar/RXR was formed to create a balanced portfolio of high-quality commercial real estate and value-add investment opportunities in the New York metropolitan area.
This Press Release contains certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are generally identifiable by use of forward-looking terminology such as "will" "expects," "intends," or other similar words or expressions. These statements are based on NorthStar/RXR's current expectations and beliefs and are subject to a number of trends and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements; NorthStar/RXR can give no assurance that its expectations will be attained. Forward-looking statements are necessarily speculative in nature, and it can be expected that some or all of the assumptions underlying any forward-looking statements will not materialize or will vary significantly from actual results. Variations of assumptions and results may be material. Factors that could cause actual results to differ materially from NorthStar/RXR's expectations include, but are not limited to, NorthStar/RXR's ability to realize the anticipated benefits of the acquisition, the ability of NorthStar/RXR to transfer and/or sell its interest in the property, if desired, the ability of NorthStar/RXR to achieve its targeted returns, the ability of RXR and its affiliates to successfully manage the property, changes in economic conditions generally and the real estate and debt markets specifically, the impact of local economics, the ability to successfully implement an exit strategy, availability of investment opportunities, availability of capital, generally accepted accounting principles, policies and rules applicable to REITs and the factors described in Part I, Item 1A of NorthStar/RXR's Annual Report on Form 10-K for the fiscal year ended December 31, 2015 and in its other filings with the Securities and Exchange Commission. The foregoing list of factors is not exhaustive. All forward-looking statements included in this Press Release are based upon information available to NorthStar/RXR on the date of this Press Release and NorthStar/RXR is under no duty to update any of the forward-looking statements after the date of this report to conform these statements to actual results.
SOURCE NorthStar/RXR New York Metro Real Estate, Inc.