Malkin Holdings LLC, the supervisor of New York’s Empire State Building, is proceeding with a plan to form a publicly traded real estate investment trust after receiving buyout offers for the tower.
The company reviewed the proposals to purchase control of the Empire State Building or its operating lease positions and determined that an initial public offering is in investors’ best interest, according to a regulatory filing today. Lazard Ltd. (LAZ:US) acted as the Malkins’ independent adviser.
Bidders including Rubin Schron’s Cammeby’s International and Joseph Sitt’s Thor Equities LLC made unsolicited offers for the Empire State Building as an alternative to the planned IPO. Malkin Holdings Chairman Peter Malkin and his son Anthony, the company’s president, began the effort to form the REIT 18 months ago, and in May won enough votes from investors in the skyscraper to proceed with the transaction following a battle with dissident investors.
The Malkins’ plan calls for the formation of a REIT holding the landmark skyscraper and 20 other properties. An appraisal of the Empire State Building values the skyscraper at $2.53 billion, according to the Malkins’ valuation firm, and it’s unclear if any of the bids topped that price.
Jason Meister, a broker with Avison Young who represented some of the bidders, said all options are still “completely on the table” and he would like to see the details of Lazard’s analysis.
“I would think the investors would be interested in understanding why the REIT was a better alternative,” he said in a telephone interview.
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