Coach Sells Headquarters for $707 Million in Lease-Back Deal
02 August 2016 - 11:40AM
Dow Jones News
Coach Inc. sold its headquarters in New York's Hudson Yards
development for $707 million under a sale and lease-back agreement,
the luxury retailer said Monday.
The sale is part of a broader deal under which Allianz Real
Estate, the property-management unit of the German insurer, bought
a 44% stake in 10 Hudson Yards, the first building completed in the
massive redevelopment project on Manhattan's West Side.
Hudson Yards, the largest private real-estate redevelopment
since the economic downturn, became a signature initiative of
former Mayor Michael Bloomberg and includes a mix of offices and
shops, apartments, a park and a school along with a train station
that opened last year.
Allianz, which paid about $420 million in cash, also bought a
portion of the stake held by Kuwait's sovereign-wealth fund, the
Kuwait Investment Authority.
10 Hudson Yards is now owned by a limited partnership that
includes Allianz, Related Cos., Oxford Properties Group Inc. and
institutional investors advised by J.P. Morgan Asset Management,
under a 10-year $1.2 billion mortgage.
The first tenant to commit to the project in 2011, Coach paid
$530 million for its 738,000-square-foot portion of the 10 Hudson
Yards tower and an additional $220 million to build out the
space.
Coach would be the largest tenant in the building, bringing
under one roof its Coach and Stuart Weitzman brands.
Best known for its handbags, Coach had said it intended to sell
its roughly 43% stake and lease back the office space. On Monday,
it said it had signed a 20-year lease but declined to comment
further, saying additional information would be released Tuesday in
a regulatory filing. Allianz said the newly formed investment
partnership holds the lease.
Write to Maria Armental at maria.armental@wsj.com
(END) Dow Jones Newswires
August 01, 2016 21:25 ET (01:25 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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