Dubai Royal Family Investment Firm Buys Helmsley Building in NYC for $705M

Istithmar, a company backed by the Dubai royal family in the United Arab Emirates, said today that it has acquired the Helmsley Building (pictured), a trophy building located at 230 Park Ave. in New York City for $705 million. The property was obtained from 230 Park Avenue Investors L.L.C., which is led by Fort Worth, Texas-based Robert Bass. The deal follows Istithmar's acquisition last month of One Trafalgar Square in London and its September pick-up of the Essex House hotel on Central Park South in New York City.

The acquisition of the Helmsley Building and the other two trophy buildings earlier this fall isn't necessarily the royal family's and Istithmar's means of jumping on highly visible buildings in major cities, such as New York and London. "My perspective is that they're not seeking out high-profile investments," observed Susan Stupin, co-founder & managing director of The Prescott Group L.L.C., who was not involved in any of these deals. The Prescott Group has worked with investors from Dubai--including the royal family--who want to buy real estate here, as well as vice versa. "They're really investing in a way that's comparable to some of the global investment (firms)," like TIAA-CREF, she said of the family.

The Helmsley Building is a 34-story gold-domed office tower, in excess of 1.2 million square feet, and has a direct connection to Grand Central Terminal. Financing for the acquisition was provided by Credit Suisse First Boston. Istithmar was advised by Island Capital.

"Istithmar is a major investment group that?s been around a long time," said David Schaiman, managing director of Sonnenblick-Goldman, which oversaw the Essex House deal. "Istithmar made a strategic decision a number of years ago to invest in the U.S., and has been investing with Milestone in buying apartments."

He noted that the Dubai royal family "obviously likes New York. Rents in office buildings here are still increasing, and there?s a lot of absorption in the city," he said. "We?re very healthy here, and the investment group wants to take advantage of that."