RXR Realty completes $1.65bn New York office deal

RXR Realty has invested $1.65bn (€1.47bn) in a New York office asset.

The private equity firm bought 1285 Avenue of the Americas from AXA Financial and institutional investors advised by JP Morgan Asset Management Global Real Assets.

The deal follows the purchase by the California Public Employees’ Retirement System (CalPERS) of 787 Seventh Avenue in Manhattan for an undisclosed amount – possibly as much as $1.9bn – through external real estate manager, Commonwealth Partners, in February.

Financing for RXR’s purchase was provided by AIG and Morgan Stanley, with $1.1bn of acquisition financing and an additional $100m future funding facility.

UBS has agreed to extend the lease for its North American headquarters, which occupies more than 900,000 sqft of space at 1285, until June 2032.

RXR, the third-largest office owner in NYC, said it had been working with UBS on the extension since December last year, when it agreed to purchase the office building.

The property is also the headquarters for global law firm Paul, Weiss, Rifkind, Wharton & Garrison, which occupies around 550,000 sqft, and the global headquarters for BBDO, which occupies around 325,000 sqft of the building.

The 1.8m sqft tower also includes retail and storage space.

RXR said it planned to upgrade the building’s lobby, modernise the elevator mechanical systems and make improvements to the plaza.