Brookfield, Qatar Investment Authority Form JV for $8.6 Billion Manhattan West Development

by Katie Sloan

New York City — A subsidiary of Brookfield Property Partners LP (NYSE: BPY) has entered into a joint venture with Qatar Investment Authority (QIA) to develop the mixed-use Manhattan West project in New York City.

In the transaction, Brookfield sold a 44 percent interest in the development to QIA. The total value of the development upon completion and stabilization is estimated to be $8.6 billion.

“Brookfield has enjoyed a long-standing, successful relationship with QIA and we are thrilled that they share our vision for this transformative project,” says Bruce Flatt, CEO of Brookfield Asset Management, a global alternative asset manager with more than $200 billion of assets under management.

New York-based Brookfield Property Partners, the flagship listed real estate company of Brookfield Asset Management, has more than $60 billion in total assets. QIA, a global investor, was founded by the State of Qatar in 2005 as its sovereign wealth fund.

“We are pleased to expand our relationship with Brookfield and invest in this world-class project. This joint venture is an example of our strategy to invest in high-quality real estate with strong partners. It is also a further demonstration of QIA’s long-term confidence in the U.S. market,” says His Excellency Sheikh Abdulla Bin Mohammed Bin Saud Al-Thani, CEO of QIA.

Manhattan West is a five-building, 7 million-square-foot development project on the west side of Manhattan, bounded by 31st and 33rd streets and 9th and 10th avenues. The project consists of the following phases:

One Manhattan West — The 67-story, 2 million-square-foot office building is currently under construction and will be anchored by tenant Skadden, Arps, Slate, Meagher & Flom LLP. The building is scheduled for completion in 2019.

Two Manhattan West — A 2 million-square-foot office tower that will be constructed following the lease-up of the first tower.

Three Manhattan West — A 62-story luxury residential tower currently under construction that will feature 844 apartment units. The first residents are slated to move in during 2017 with final completion slated for 2018.

Four Manhattan West — Initial plans for this phase include a hotel or additional residential units.

Five Manhattan West — The 1.8 million-square-foot office building — formerly known as 450 W. 33rd St. — is currently undergoing a $350 million redevelopment program, which will fully modernize and integrate the building into the Manhattan West campus. In the last 12 months, Brookfield has signed leases totaling more than 400,000 square feet at this property to technology and media tenants, bringing current occupancy to 90 percent.

Central Plaza / Retail — The Manhattan West campus will be transected by a two-acre public park, creating a new “32nd Street” pedestrian thoroughfare, lined with abundant green space and approximately 200,000 square feet of retail space, restaurants and amenities.

“Manhattan West is on track to be the premier mixed-use development in the Hudson Yards district — New York City’s next great neighborhood,” says Ric Clark, CEO of Brookfield Property Group. “The sale of an interest in Manhattan West is consistent with our strategy of actively recycling capital by partnering with leading institutional capital providers.”

Brookfield Property Partners’ diversified portfolio includes more than 130 office properties and more than 150 upscale retail malls around the world. Brookfield Property Partners is listed on the New York and Toronto stock exchanges.

The company’s stock price on the New York Stock Exchange closed on Wednesday, Oct. 28 at $23.54 per share, up from $22.56 per share at this time last year.

Headquartered in Doha, Qatar, and now with an office in New York, QIA has a track record of investing in different asset classes, including listed securities, property, alternative assets and private equity.

— John Nelson

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