- RXR secured $1.45B in recapitalization for 1211 Avenue of the Americas, a 2M SF Midtown Manhattan office tower near Rockefeller Center.
- More than $250M will go toward tenant improvements, renovations, and leasing commissions as part of a major repositioning.
- The deal is part of RXR’s new Gemini Office Venture, formed with Baupost, King Street, Criterion Capital, and others to acquire and invest in distressed trophy office assets.
A Major Midtown Move
RXR has finalized a $1.45B recapitalization of 1211 Avenue of the Americas, reports Commercial Observer. The 45-story, 2M SF office tower is located in Midtown Manhattan. The deal is part of RXR’s broader strategy to reposition high-profile but challenged office assets.
Who’s In The Deal
The recap was backed by a group of institutional investors. Participants included Baupost Group, King Street Capital Management, Criterion Real Estate Capital, Abrams Capital, and Liberty Mutual Investments. Apollo Global Management also extended its $1.035B CMBS debt by three years, pushing the maturity from 2025 to mid-2028.
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The Numbers
Of the recapitalized capital, about $367M in new equity will be used for a range of improvements:
- $130M: Tenant improvements for Fox News and other upgrades
- $110M: Renovation and re-leasing of space formerly occupied by Ropes & Gray
- $61M: Additional capital expenditures
- $54M: Other tenant buildouts and enhancements
Tenant Spotlight
Fox News and News Corp. collectively lease over 1.1M SF in the building. Together, they occupy more than half of the tower, with leases extending through 2042. The law firm Ropes & Gray exited in 2024, freeing up several high floors now set for re-tenanting.
Why It Matters
The recap comes at a time when trophy assets in gateway cities are struggling with rising vacancies and refinancing pressure. RXR’s Gemini Office Venture has now closed $3.5B in deals. The platform is betting on the long-term value of iconic office buildings through recapitalization and reinvestment.
What’s Next
With Gemini’s backing, RXR is now focused on acquiring or recapitalizing more high-profile office towers at steep discounts. In addition to 1211 Avenue of the Americas, the platform has already taken stakes in 590 Madison Avenue and the Starrett-Lehigh Building.
The Big Picture
Institutional capital continues to pursue opportunities in the reset office market. Recapitalizations like this reflect a shift toward strategic reinvestment in assets with long-term upside, particularly those in prime locations with anchor tenants.
