Israeli company sells HSBC tower in New York for $ 855 million – .

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Israeli company sells HSBC tower in New York for $ 855 million – .


JERUSALEM, Dec. 5 (Reuters) – Israel’s Property and Building Corp (PTBL.TA) announced on Sunday that it has agreed to sell the HSBC Tower building in midtown Manhattan for $ 855 million to New York real estate firm Innovo Property Group, posting a net loss of $ 45 million.

The Israeli company, 63% owned by Discount Investment Corp (DISI.TA), said it also sold real estate in Israel for 390 million shekels ($ 123 million).

Doron Cohen, managing director of Property and Building and Discount, said management is focusing on income-generating properties in Israel and that the amount they are receiving from the two transactions will allow them to move this policy forward.

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“We are continuing the policy and looking at the possibility of realizing additional properties in the United States and Israel,” Cohen said, noting that the sale of the HSBC building came despite “gloomy” forecasts in the US commercial real estate market.

He cited Tivoli Village, an upscale Las Vegas apartment complex that opened this year, which could be put up for sale as part of the company’s efforts to increase cash flow and reduce debt.

Together with the conglomerate Koor Industries, Property and Building, purchased the 30-story, 80,000 square meter HSBC tower in 2009 for $ 353 million. In 2011, Property acquired Koor’s stake in the tower which has an occupancy rate of 99%, he said. HSBC bought the building in the 1990s.

Property and Building said the value of the HSBC Tower on its books was $ 864 million as of September 30. After the costs, he said he would record a net loss of $ 45 million on the sale.

The sale is expected to close by April 1, 2022, subject to Innovo’s right to advance the date while receiving options to postpone the finalization twice for 30 days each.

The property said after the sale it would have a net cash flow of $ 343 million.

Its shares were down 0.7% in afternoon trading in Tel Aviv.

(1 $ = 3,1605 shekels)

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Reporting by Steven Scheer; Editing by Elaine Hardcastle

Our Standards: Thomson Reuters Trust Principles.

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