(Bloomberg)—HNA Group Co. sold a building in Manhattan to help ease the embattled conglomerate’s debts and stave off U.S. concerns about a Chinese company owning property near Trump Tower.
HNA completed the sale of 850 Third Ave., the group said in a statement, without providing details. Bisnow reported earlier that investor and real estate developer Jacob Chetrit and his sons bought the tower in a $422 million transaction that resulted in a loss for HNA. The Chinese company, which bought the tower for $463 million with its partners before Donald Trump became president, had been trying to sell the property since at least early 2018.
Hainan, China-based HNA owned 90 percent of the tower, with minority partners MHP Real Estate Services and Atco Properties & Management LLC owning the rest.
“We look forward to working with and providing more opportunities to our friends, Jacob Chetrit and his sons Michael and Simon,” MHP’s president and chief executive officer, David Sturner, said in an emailed statement. “We are thrilled to have sold this notable asset to a well-respected and established family in the NYC real estate arena.”
The sale adds to the more than $20 billion in disposals that HNA has agreed to since last year -- including real estate holdings from San Francisco to Minneapolis -- to reduce its massive debts. But the Manhattan building stood out because of the national-security concerns associated with the tower.
The sale also comes amid simmering tensions between the U.S. and China’s government, which last year was said to have decided to help HNA, the largest foreign buyer of U.S. office buildings in 2017, pull itself out of chronic liquidity challenges.
The sale to a U.S. buyer is likely to satisfy concerns from the Committee on Foreign Investment in the U.S. regarding HNA’s ownership of the building, which houses one of only two police precincts that are within a mile of Trump Tower, the president’s base when he’s in New York.
To contact the reporter on this story: Gillian Tan in New York at [email protected] To contact the editors responsible for this story: Young-Sam Cho at [email protected] Dave McCombs, Christine Maurus
© 2019 Bloomberg L.P