Real Estate: Coronavirus Hits Property Deals Across Manhattan
As the coronavirus hits New York City, real estate investors like RFR Realty are backing away from previously announced deals.
RFR Realty Walks from Two Deals
Aby Rosen, the co-founder and principal of RFR Realty, is dropping out of two previously announced deals in Manhattan. RFR is backing out on a deal to buy 900 Third Avenue in Midtown from Paramount Group (PGRE) for $400 million. It is also walked away from a plan to buy property at 1600 Broadway in Times Square that listed at roughly $200 million. There are reports that Mr. Rosen is willing to consider closing the deal for 900 Third Avenue when the pandemic has passed.
RFR is a large owner of commercial real estate in New York. The firm owns landmark properties like the Seagram Building, The Chrysler Building, and The Gramercy Park Hotel.
RFR is not the only investment and property management firm backing out of transactions.
Joseph Chetrit of the Cherit Group has also pulled out the proposed purchase of the former Daily News building at 220 East 42nd Street in Midtown from SL Green for $815 million. In this case, the potential buyer didn’t just back away. The primary source of financing for the transaction was Deutsche Bank (DB). The German firm pulled out before the sale could close.
New York City commercial real estate market was one of the strongest markets in the country before the coronavirus hit the United States. We will likely see some repricing, especially since cash flows will likely fall due to the failure of small businesses and restaurants in the city.
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