Paramount Takes it All at Manhattan Office Building

Paramount Group has bought out its joint venture partner on a high-profile asset in The Big Apple.

By Gail Kalinoski, Contributing Editor31W 52nd

Paramount Group, Inc., has bought out its joint venture partner in 31 W. 52nd St., taking the remaining 35.8 percent ownership stake in the 29-story Midtown Manhattan office building for $230 million in cash.

The New York-based office property REIT declined to name the joint venture partner. The acquisition is expected to be completed in the fourth quarter.

“The acquisition of the remaining ownership in this distinctive trophy asset offers Paramount an outstanding opportunity to execute on our embedded growth strategy,” Albert Behler, chairman, CEO & president, said in a prepared statement. “We believe full ownership of the property is in the best long-term interests of our shareholders, as we continue to focus our efforts on driving NOI growth through strategic and creative leasing and other key initiatives.”

Paramount bought the 786,647-square-foot, Class A office building located between Fifth Avenue and Avenue of the Americas in late 2007 from Hines, Deutsche Bank and RREEF for $595 million, according to various media reports at the time. Hines developed the property in 1986 with CBS, Inc. At various times it was known as the Deutsche Bank Building and the E.F. Hutton Building, based on some of its former major tenants. Some of its current tenants include the law firms Holland &Knight and Clifford Chance as well as investment firms Centerview Partners and Stone Harbor Investment Partners.

Located in the heart of Midtown in the Plaza District submarket, the property has views of Central Park, Rockefeller Center and other Manhattan landmarks. It features a large public plaza that connects 52nd Street to 53rd Street and a 120-space parking garage. The property is close to five subway lines, numerous luxury hotels, upscale retail store and museums. The building was designed by Kevin Roche John Dinkeloo & Associates and has a granite-clad and aluminum framed glass curtain wall façade with four-story granite columns at the entrances to 52nd and 53rd streets which lead to the landscaped public plaza.

The skyscraper is one of several office buildings owned by Paramount in Manhattan, including 712 Fifth Ave., 1301 and 1325 Avenue of the Americas and 1633 Broadway. Paramount, which became a publicly-traded REIT last year, also owns, operates, manages, acquires and redevelops Class A office buildings in San Francisco and Washington, D.C. Paramount expanded its San Francisco holdings a year ago when it acquired 50 Beale St., a 23-story, 662,060-square-foot office building, for $395 million.