Implications of John Hancock Tower Auction Grim for Commercial Real Estate

The most iconic building on the Boston skyline, the John Hancock Tower designed by I.M. Pei, sold at auction yesterday for $661 million to bargain hunting investors Normandy Real Estate Partners and Five Mile Capital Partners. The sale followed a default on part of the debt used to finance the purchase of the building for $1.3 billion in 2006. The winning bid, the only bid in fact, was actually $20.1 million plus the assumption of a $640.5 million first mortgage.

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