Posted by: BayAreaComRE | October 4, 2010

Hancock Tower Boston (Remix)

Congrats to our Boston Capital Markets team on closing this monster deal, we sourced the article from GlobeStreet.com. The Hancock Tower was previously auctioned off in a foreclosure auction in the spring of 2009, after the $700 Million mezzanine had been defaulted on. Today’s transaction is a testament to the strengthening of core office investment fundamentals.

If we estimate a conservative Loan to Value ratio on that deal (which was likely given the financing constraints at that time), then Normandy/Five Mile profited somewhere in the ballpark of $100M to $200M in 18 months…that’s an 33% to 70% return depending on the partnership structure. In other words; a grand slam no matter how you look at it.

BOSTON-Eighteen months after paying $660.6 million for it at auction, a partnership of Normandy Real Estate Partners and Five Mile Capital Partners is selling the iconic John Hancock Tower here to Boston Properties for $930 million. The purchase price includes the assumption of a $640.5-million senior mortgage loan.

In announcing its acquisition of the 1.7-million-square-foot Hancock tower, BPX says it’s also putting up $289.5 million in cash. The deal is expected to close by the end of the year.

The Normandy/Five Mile partnership reportedly was the sole bidder at the March 2009 auction on the Hancock tower, which at 62 stories is the region’s tallest building. Broadway Partners paid $1.3 billion for the office tower at 200 Clarendon St. in December 2006, part of a 10-building portfolio it acquired from locally based Beacon Capital Partners for $3.3 billion. Early last year, Broadway defaulted on about $700 million of debt in connection with the Hancock tower.

Cushman & Wakefield’s Rob Griffin and Ed Maher brokered the transaction. Law firm Goodwin Procter LLP advised BPX, while Allen & Overy LLP and Haynes & Boone LLP advised the sellers.

The full article can be found here: http://www.globest.com/news/1760_1760/boston/303053-1.html?ET=globest:e23713:462102a:&st=email

Advertisements

Responses

  1. That\’s way more clever than I was expctieng. Thanks!


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Categories

%d bloggers like this: