Vornado Realty Trust announced that, pursuant to a right of first offer, it has agreed to acquire Canada Pension Plan Investment Board’s 45 percent interest in One Park Avenue, increasing Vornado’s ownership interest to 100 percent.
The purchase price values the property at $875 million. The consideration to CPP Investments is approximately $158 million in cash plus Vornado is assuming CPP Investments’ share of the existing debt.
The property is currently encumbered by $525 million of debt, which bears interest at a rate of LIBOR plus 1.11 percent and matures in March 2026, as fully extended.
One Park Avenue is a 943,000 square foot Manhattan office building that is 67 percent leased to New York University through May 2050.
Vornado originally acquired an interest in the property in March 2011 at a $394 million valuation and recapitalized the property with CPP Investments in June 2014 at a $560 million valuation.
The purchase is expected to close in the third quarter of 2021.