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Deals & Dealmakers

Investcorp buys two New York REIT buildings in Midtown West for $156M

Bahrain-based asset manager Investcorp has bought two New York REIT office buildings as the company continues to liquidate its assets.

Investcorpʼs U.S.-based real estate arm bought 229 West 36th Street and 256 West 38th Street for $156 million.

“We are excited to announce our investment into the Manhattan market, as expanding our real estate portfolio in the U.S. is a key component of our firm’s overall growth strategy,” said Mohammed Alardhi, executive chairman of Investcorp.

“As one of the largest foreign investors in U.S. real estate, we have invested over $2 billion in the last 18 months and will continue to focus on uncovering opportunities in gateway cities across the country.”
229 West 36th Street and 256 West 38th Street are fully leased to a roster of over 20 long-term tenants and total approximately 267,000 s/f.

As part of the transaction, Investcorp has entered into a joint venture with Brickman, a New York-based owner-operator which will maintain a joint-venture investment in the properties and serve as the leasing and management agent.

“We are excited to enter into our third partnership with Brickman, as we believe their investment and management capabilities will unlock immediate value in each of the properties,” said Brian Kelley, managing director in Real Estate Investment at Investcorp.

In a statement, New York REIT said 229 West 36th Street was part of the collateral for a cross-collateralized and secured loan of $760 million. NYRT paid $66.1 million on account of the loan, resulting in a remaining outstanding principal balance of approximately $267.9 million.

The 256 West 38th Street property was encumbered by a loan in the original principal amount of $24.5 million. NYRT paid off the loan in its entirety and received net proceeds of approximately $58.8 million.

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