New York & Tri-State + Retail | February 12, 2019

HBC Closes Sale of Midtown Flagship to WeWork

HBC has closed on the sale of the Lord & Taylor Fifth Avenue building to WeWork Property Investors (WPI), the investment vehicle managed by WeWork and the Rhone Group. The 10-story Midtown landmark, long home to Lord & Taylor’s recently-shuttered flagship store, sold for $850 million, consistent with terms that were disclosed when the sale was announced in October 2017.

“This transaction reinforces HBC’s ability to identify undervalued real estate investments with great potential,” said Richard Baker, HBC’s executive chairman. “We continue to strengthen our retail business and unlock the value of our real estate assets.”

WPI exercised its option to convert $125 million of the transaction value into a preferred equity interest in the building held by HBC through a joint venture structure. The planned redevelopment of the 663,000-square-foot property at 424 Fifth Ave., which will house WeWork’s global headquarters, is being undertaken in collaboration with architect Bjarke Ingels.

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About Paul Bubny

Paul Bubny serves as Senior Content Director for Connect Commercial Real Estate, a role to which he brings 13-plus years’ experience covering the commercial real estate industry and 30-plus years in business-to-business journalism. In this capacity, he oversees daily operations while also reporting on both local/regional markets and national trends, covering individual transactions across all property types, as well as delving into broader subject matter. He produces 15-20 daily news stories per day and works with the Connect team and clients to develop longer-form content, ranging from Q&As to thought-leadership pieces. Prior to joining Connect, Paul was Managing Editor for both Real Estate Forum and GlobeSt.com at American Lawyer Media, where he oversaw operations at both publications while also producing daily news and feature-length articles. His tenure in B2B publishing stretches back into the print era, and he has served as Editor in Chief on four national trade publications. Since 1999, Paul has volunteered as the newsletter editor of passenger rail advocacy groups (one national, one local).