Allianz Said to Bid for 48% Stake in New York Hudson Yards Towerby
Insurer said seeking to buy out Coach at 10 Hudson Yards
Handbag maker would lease its space when tower opens this year
Allianz SE is in advanced talks to acquire a 48 percent stake in 10 Hudson Yards, the first tower set for completion at Related Cos.’ sprawling real estate development on Manhattan’s far west side, according to two people with knowledge of the talks.
A unit of the Munich-based insurer is seeking to buy out handbag maker Coach Inc., which planned to sell its space and instead lease it as the building’s anchor tenant when the tower opens later this year, said the people, who asked not to be identified because the talks are ongoing. A deal hasn’t been reached and other bidders could still prevail, the people said.
Representatives for Related, Allianz and Coach declined to comment on a potential transaction.
Related is leading what it calls the largest private U.S. real estate project ever on 28 acres (11 hectares) mostly on top of Manhattan’s west side train yards. A deal by Allianz at Hudson Yards would come at a pivotal time for New York’s real estate market. Property transactions in the city slowed in the first quarter as buyers pulled back amid concern that the slump in oil prices, China’s slowing economy and tougher lending standards may crimp six years of record-shattering price growth.
At 10 Hudson Yards, more than 90 percent of the 1.7 million-square-foot (158,000-square-meter) tower is leased. Besides Coach, tenants will include L’Oreal USA, SAP AG, VanyerMedia and Boston Consulting Group. Another tower rising at the project, 30 Hudson Yards, will have companies such as KKR & Co., Time Warner Inc. and Wells Fargo & Co.
Jane Nielsen, chief financial officer at Coach, said on a January conference call with investors that a sale of its stake at 10 Hudson Yards probably wouldn’t be completed until summer. The luxury retailer was the first company to commit to space at Hudson Yards, paying $530 million for its 738,000-square-foot portion of the tower in 2013.
Doug Harmon, a senior managing director at Eastdil Secured LLC, is representing the owners at 10 Hudson Yards.