The owners of two Park Avenue sites are teaming up to shop a collective redevelopment prize, The Promote has learned, in what is slated to be the first fee simple offering on the prime corridor in decades. Expect an ultra frou-frou office tower if things go right. 🐩

A JV between GDS Development and Swedish investor Klövern AB controls 417 Park Ave, after pulling off a bulk co-op buyout for $184M in ‘20 and subsequently demo’ing the 14-story property. Meanwhile, the site just over at 405 Park is controlled by a JV between German asset manager DWS and MRP Realty, which demolished the boutique office building on it in ‘23 to set the stage for a ground-up project. The dirt already benefits from the Midtown East upzoning. But to really make this a marquee offering, the owners have joined forces and are collectively pitching the sites via Newmark, according to sources.

With President Trump signing an exec order Thursday that paves the way for 401(k) funds to flow into REPE, our latest pod episode could not be more timely. We break down how Blackstone, KKR and other private-credit giants have been arduously courting 401(k) managers, prepping for this very moment. Listen on Spotify here, YouTube here or Apple Podcasts here. Shout-out to our episode sponsor, Vesto - learn more about how it gives CRE players a single, clear point of access for all their bank accounts by going to vesto.com

MRP/DWS had put 405 Park on the market in ‘20, teasing a price of $350M at the time, but later pulled the listing and demolished the building on site. Meanwhile, GDS, after financing the 417 Park co-op purchase through the Swedish bond market, added 407 to the mix in ‘21. We’re fuzzy on what the combined square footage of the 405-417 redevelopment will be, though it’s likely in the 700K sf range. What is clear is that any office tower that rises here is destined to be a single-malt building ™ 🥃 . There is shockingly little premium space available in the corridor, and asking rents at RFR’s nearby Seagram Building are in the $275/ 🦶range. Ownership may look to stay in the action, per sources, eyeing capital partners that would be down to JV on the redevelopment project. The fee simple aspect here is notable; most of the action on Park in recent years has been via ground-lease deals, such as L&L’s redevelopment of 425 Park Ave, where Jay Sugarman’s Safehold controls the fee.

GDS (Michael Kirchmann, Alan Rudikoff) has developed quite the rep for creative dealmaking. It pulled off something fascinating at the Met Tower (in partnership w/ Sabal & lender Aareal) on 57th St. that we’re still trying to figure out – we’ve been told the capstack there is/was quite the creature.

Quite a whopper on LA’s most iconic shopping corridor: ECA Capital, the investment vehicle of Cuisine de France co-founder Ronan McNamee 🍀 , has sold a Rodeo Drive property for $400M+, or north of $14K/ 🦶. That makes it the priciest single-property trade on Rodeo, per TRD, and Beverly Hills’ 2nd-priciest deal after the Candy Bros’ $500M acquisition of Robinson’s-May in ‘07. ECA bought the 28K sf spread at 338 North Rodeo Drive for $81.5M ($2,900/ 🦶 ) in ‘07, and refi’d in ‘19 at $160M, or $5,600/ 🦶. Tenants include Tom Ford, Moncler & Balenciaga. 😎 🧥

The buyer is still in the shadows, but it’s worth noting that LVMH owns about half the block. It’s developing a 3-story flagship for Dior, houses Givenchy at 332 N. Rodeo Drive right next door to the space that just traded, and is also kicking off the development of its LVMH flagship.

Rhyming w/ trends in Manhattan, LA’s retail market has seen quite the bifurcation: mid-tier corridors have gotten rocked, but super-prime space is as hot as it’s ever been – avg. retail rents on Rodeo Drive jumped 19% YoY in ‘24, to $1,100 / 🦶, per CushWake.

Bonus: Our take on the LVMH-Kering luxury real estate war starts at 18:30

The Promote’s been reporting on a series of fascinating plays by Joshua Zamir’s Capstone Equities (See: Shahs of NPLs) for months, and many of these deals have now crossed the finish line. To wit:

Michael Shvo’s cranking up the legal heat on a key bankroller of his trophy shopping spree. The impresario brought an arbitration case against Bayerische Versorgungskammer (aka BVK), claiming the firm, which manages German pensioner money, has stiffed him on $85M in fees 🧃. German paper Abendzeitung first reported the dispute, and a rep for BVK told Bisnow that it “has been dealing with the issues you have raised in detail for some time” and is conducting its own review. Meanwhile, the 2 BVK execs who orchestrated the deals w/ Shvo are no longer at the fund. We also have deets on the scale of the BVK commitment to Shvo projects – a whopping $712M, per a parliamentary document obtained by Bisnow and translated from the German. (BVK had been summoned to parliament last fall over its Shvo dealings, done through investment manager Deutsche Finance. )

Shvo’s $2.5B deal frenzy included name-brand skyscrapers such as Chicago’s Big Red, SF’s Transamerica Pyramid, and New York’s Coca-Cola Building, along w/ boutique projects such as the Raleigh Miami Beach (Nahla Capital is gunning to take this one over) & the Mandarin Oriental Beverly Hills (bulk condos sold in distressed sale to Centurion).

Pimco has won a hotly contested battle to fund Meta’s gargantuan data-center development in Louisiana, beating out the likes of Apollo & KKR to lead the initiative. Pimco will lead the $26B debt financing for the project, w/ Blue Owl kicking in a $3B equity chunk, per Bloomberg. The debt could come in the form of investment-grade bonds 🤔 backed by the centers, per the publication.

The mega-managers love the data-center biz in part because it gives them a chance to put billions to work in one fell swoop. Think of the numbers here – funding this one project is basically the same as funding eight One Vandys, now the most valuable office tower in America. All the big players are jockeying for a slice of the space, from BlackRock’s $30B tie-up w/ Microsoft & Abu Dhabi 🏏 to Blackstone’s empire-building w/ QTS.

Q: One thing we’d love more insight on is how the debt brokers in this space get paid. The $ volumes are so cartoonishly high, that splits cannot possibly work the way they do in standard CRE deals. Newmark, for e.g., has been cleaning up here, but what do the commissions look like for Jordy Roeschlaub, Brent Mayo & their band of brothers? Write us if you know 🖋

BTW: If your 👂👂 crave more data-center content, The Promote Podcast has you covered. Will & Hiten try to grapple w/ the numbers-vs-returns in the space, and then have DigitalBridge’s Marc Ganzi on to deconstruct a couple of defining transactions.