Australia´s ING Office Fund makes its first foray into the US market by acquiring a 49% interest--50% voting interest--in 900 Third Ave. Completed in 1984, the property has a total net rentable area of 585 million sf.
In April, GlobeSt.com reported that Paramount Group was breaking from its typical long-term-hold strategy to flip the 592,000-sf asset. Paramount bought the building in 1999 for $163 million.
ING Office says its share of the acquisition--$107.7 million--will be funded through a combination of existing property level debt and new equity. Equity funding for the acquisition will be through an underwritten bookbuild being conducted by UBS and Merrill Lynch of 50 million units to raise about $56 million in Australian dollars.
Ã¢â¬ÅThe key strengths of the asset, its location, long average lease term, solid covenants and ability to produce growth to earnings in the short to long term match the FundÃ¢â¬â¢s strategy perfectly,' says Tino Tanfara, CEO ING Office Fund. 'New York is a premier world office market and one of the key markets targeted by the Fund for its initial US expansion. This asset complements the FundÃ¢â¬â¢s existing property portfolio, with foreign exchange and interest rate risks mitigated to ensure the benefits to the FundÃ¢â¬â¢s earnings are not eroded.Ã¢â¬Â
Tenants include Kroll, Shiseido Cosmetics and The Gap.