Nov 14, 2013

    GIC to buy part of iconic NY complex

    The Business Times

    SINGAPORE'S GIC is close to snapping up a part of New York City's Time Warner Center, an iconic, 229m twin-tower mixed-use complex in the south-western corner of the city's famed Central Park.

    The Business Times understands that GIC is part of a consortium in the final stage of talks with Time Warner to buy the 1.1 million sq ft of office space that the latter owns. The consortium will then lease the space back to Time Warner.

    A source close to the deal said that GIC will be forking out US$400 million (S$500 million), which will give it a "substantial stake" in the Grade A office space that Time Warner is selling.

    The consortium is said to have fought off offers from interested parties, including a sovereign wealth fund.

    Earlier this year, Time Warner was said to be close to selling the space for US$1.3 billion to a group called Related Companies, a privately-owned real-estate firm headquartered in New York City and the lead developer of the Time Warner Center.

    Time Warner was then supposed to have leased the space back for five years, and then move to a 2.4 million sq ft tower along the Hudson River, called the Hudson Yards, which is being developed by Related, said media reports.

    The Hudson Yards is a joint venture between the New York City Department of City Planning and Metropolitan Transportation Authority to encourage business development on Manhattan's far west side.

    GIC declined to comment on the deal, but a source said the location and expectations of an above-average net yield were the lures behind this acquisition.

    The source said: "It is one of the best office buildings in New York City in terms of the quality of the asset, the amenities and the view. I mean, Central Park is gorgeous."

    The Time Warner Center, completed in 2004, has a pair of towers bridged by a multi-storey atrium that is home to upscale retail shops.

    The towers have a total floor area of 2.8 million sq ft, housing offices, the Mandarin Oriental New York hotel and residential condominium units.