Norway's €682 bn oil pension fund is investing $1.5 bn (€1.2 bn) in its latest office joint venture in the US.
Norway's €682 bn oil pension fund is investing $1.5 bn (€1.2 bn) in its latest office joint venture in the US.
Norges Bank Investment Management - which manages the fund - has entered into a binding agreement with Boston Properties to acquire a 45% interest in a three-asset office portfolio in New York and Boston.
NBIM and Boston Properties will form a joint venture for each property upon closing, and Boston Properties will retain property and leasing management for the ventures. The transaction values the full portfolio at $4 bn.
The New York asset is 601 Lexington Avenue, a 155,000 m2 Class A office complex located in the heart of Midtown Manhattan at East 53rd Street and Lexington Avenue. The property consists of a 59-storey tower as well as a six-storey low-rise office and retail building.
The Boston assets are The Atlantic Wharf Office Building, a 73,486 m2 office tower located on the city's Waterfront and 100 Federal Street, a 123,000 m2, 37-storey tower located in the city's financial district.
In September 2014 Norges agreed to acquire a 49.9% interest in The Orrick Building in San Francisco, in a joint venture with US investment manager Tiaa-Cref for €140 mln. The property, also known as Foundry Square II, provides 48,400 m2 of office space.
The Norwegian fund entered the US office market in December 2013 when it unveiled a $1.7 bn joint venture with insurer MetLife. So far the partners have carried out transactions on four assets. Norges has a 47.5% stake worth $717 mln in the joint venture.
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