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Blackstone Said to Gain Control of New York Tower in Loan Deal

April 1 (Bloomberg) -- Blackstone Group LP agreed to pay about $100 million for the loan on Manhattan’s 1140 Avenue of the Americas to gain control of the Midtown office building, according to a person with knowledge of the transaction.

The New York-based company won the bidding for the note on the 22-story tower, located between 44th and 45th streets near Bryant Park, allowing it to take over the property, said the person, who asked not to be identified because the transaction is private. The debt was held by Germany’s Landesbank Baden-Wuerttemberg, the person said.

A partnership of Stellar Management and Rockpoint Group bought the building from SL Green Realty Corp. for $97.5 million in 2006, when commercial real estate prices were close to a record. The venture has stopped making its mortgage payments, according to Crain’s New York Business.

Stellar and Rockpoint borrowed $116 million through a mortgage and about $13 million of mezzanine debt to acquire and renovate the property, which is now more than 50 percent vacant, according to the person with knowledge of the note sale.

Peter Rose, a spokesman for Blackstone, the world’s biggest private-equity firm, declined to comment. Representatives of Stellar Management, Rockpoint and Holliday Fenoglio Fowler LP, which conducted the debt auction, didn’t respond to calls and e-mails yesterday seeking comment.

The Real Deal Online reported the loan agreement yesterday.

The purchase of the loan on the 231,000-square-foot (21,500-square-meter) building adds to a spate of recent investments by Blackstone in anticipation of a recovery in U.S. commercial real estate. In February, it agreed to pay about $9.4 billion for Centro Properties Group’s U.S. shopping centers in its largest purchase since October 2007.

To contact the reporters on this story: Hui-yong Yu in Seattle at

To contact the editor responsible for this story: Kara Wetzel at

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