The players involved in bringing this deal to fruition include:
Michael Evans, president of ESD’s Moynihan Station Development
Corp., Marc Ricks, SVP of Development for Vornado; Related Cos.’
VP, Andrew Rosen; John Sullivan, VP of Field Operations for
Skanska; Tom Rousakis, senior managing director, Ernst & Young
Infrastructure Advisors; Dina Shaher, financial policy advisor, Build
America Bureau Credit Office of the US DOT; William Wheeler,
director of special project development & planning for the MTA;
and Bart Bush, Amtrak’s VP of real estate stations and facilities.
Skadden, Arps, Slate, Meagher & Flom’s Neil Rock, head of the
New York real estate group, and real estate partners Vered Rabia
and Marco Caffuzzi led the legal team that counseled ESD and its
subsidiary, Moynihan Station Development Corp. The project
involved coordination among EDS; the designated developer (a
jv between the Related Cos. and Vornado Realty Trust) and their
contractor, Skanska USA; National Railroad Passenger Corp. and
the Metropolitan Transportation Authority. The Skadden team
also represented EDS in connection with a loan from the US
Department of Transportation.
Meanwhile, Fried Frank served as counsel to the Vornado-Related JV in connection with the acquisition, development and
financing of the project. The firm’s partners, Tal Golomb and
Rob Sorin, led the Fried Frank team of Stephen Lefkowitz,
Julianne Befeler, Melissa Brown, Holly Chen, Wesley O’Brien,
Jason Robinson and Ross Wasserman on the deal.
The project will expand the existing Penn station rail complex’s
concourse space by 50%, relieve overcrowding, provide a vibrant
neighborhood amenity, and improve the experience of the busiest
passenger transportation facility in the Americas (used by over
650,000 passengers per day) for commuters and visitors alike.
A LOOK AT TWO SPECIAL CASES
Some deals don’t fit into the cookie-cutter descriptions of leasing,
sales, development or finance. Or into specific property segments.
September saw a transaction that was the largest single invest-ment to date for Ohio State University. It helped to further the
university’s mission to position itself as an international leader in
energy and sustainability, and strengthen its goal as a national
flagship public research university.
The deal had a total consideration in excess of $1.3 billion and
was a first of its kind public-private partnership given its scope,
depth and subject matter. The 50-year lease and concession agreement encompassed leasing the university’s existing utility system
(including electricity, steam and condensate, chilled water, natural
gas and geothermal power) to a third-party concessionaire, implementation of energy conservation measures by the concessionaire
to meet certain energy savings goals, assistance with the procurement of energy supplies for the university, and development of an
academic collaboration relationship with the university.
A legal team from Jones Day advised the university. Its members included Brian Sedlak, lead partner, real estate; Mark
Demonte, partner, business & tort litigation; Stephen Mixter, of
counsel, real estate; Michael Ording, partner, real estate; Rich
Puttre’, partner, projects & snfrastructure and associates Michael
Austin, Deborah Huerta and Susan Restrepo.
Another major deal last year came from a lease for a flea mar-
ket portfolio. Closing last July, Avison Young completed the
$80-million sale of Opa-Locka/Hialeah Flea Market, spanning
three parcels totaling 72.10 acres, and a 12-year lease with its new
operator, Gramercy Property Trust. Avison Young principal and
managing director Michael T. Fay and Wayne Schuchts, principal,
handled the months-long sale negotiations.
The Opa-Locka/Hialeah Flea Market represents one of the largest employer facilities in Opa-Locka, where 90% of merchants have
operated at the flea market for over 20 years. It is said to be an
anomaly due to its unique position near major highways and roadways, and with the recent closing of larger box stores, the resurgence
of open-air shopping destinations made this deal noteworthy.
STATE FARM WRAPS UP SLB SERIES
In what’s said to be the largest commercial office property sale in
Phoenix history, Transwestern Investment Group and JDM
bought Marina Heights in Tempe, AZ for $928 million. The class
A, five-building, LEED-certified office campus sits on 20 acres and
features ground-floor retail, restaurants and other amenities.
Leveraging its relationship with the seller, State Farm Auto
Insurance Co., Transwestern arranged the sale-leaseback on the
two-million-sf asset, representing the third and final in a series of
similar sale-leaseback transactions with State Farm that began in
2016 and involved assets in Texas and Atlanta. The deal was structured by Charles Hazen and Collin Comer, Transwestern Investment
Group’s president and senior managing director, respectively.
LOCAL & GLOBAL PLAYERS INK NATION’S LARGEST SALES
In the most US valuable office sale of 2017, a partnership of
Brookfield Property Partners, Clarion Part-ners and the New York
State Teachers’ Retirement System sold 245 Park Ave. to HNA, a
Chinese conglom-erate, and an unidentified partner. At $2.21 billion, the transaction went down as one of the most ex-pensive
acquisitions in history of a Manhattan skyscraper and clearly illustrated foreign investors’ inter-est in trophy US assets. The price
tag puts a 4.7% cap rate and per-sf price of $1,292 on the 1.7-mil-
lion-sf Midtown tower. CBRE’s Darcy Stacom and William
Shanahan represented the sellers.
Taking the No. 2 spot, SL Green Realty Corp., New York City’s
largest office landlord, entered a contract to sell a 43% interest in
One Astor Plaza, or 1515 Broadway, to Allianz Real Estate, the real
estate invest-ment and asset manager of the Munich-based Allianz
Group. The deal values the 1.86-million-sf Times Square office tower
at $1.95 billion, or $1,045 per square foot and a 4% cap rate. SL
Green will receive approximately $416 million in cash from the sale.
The transaction was complicated from a tax perspective, as its
investment structure required conversion of certain entities and
the use of a domestically controlled REIT. A firm of Mayer Brown
was able to achieve the structuring needs within a compressed
time frame of 30 days for the buyer. The Chicago- and New York-
60 Wall Street