JR AMC buys $140 mn stake in NY office building

South Korea's JR AMC Co. has signed a $140 million agreement to buy a 49.9% stake in a New York office building from JPMorgan Asset Management.

Once the deal is completed next month, the Korean asset manager will transfer the equity interest to JR Global REIT, a real estate investment trust listed on the Korea Exchange, within the year, according to investment banking sources on May 12.

The 78,251-square-meter property is located on 498 7th Avenue in Midtown Manhattan, the central portion of the New York City. Service Employees International Union (SEIU), one of the largest labor unions in North America, occupies 61% of the office space under an agreement that ends in 2050.

It is within 15-minute walking distance of landmark buildings such as Time Square, Empire State Building and New York Public Library. KB Securiteis arranged the deal.

The stake in the office building will become JR Global REIT's second asset after the Finance Tower in Brussels. The second-tallest building in Belgium houses Belgium's Federal Public Finance Service under a long-term lease contract until 2034 and offers a 7% dividend yield per annum.

JR Global REIT went public on Korea's main stock bourse in August 2020. Since its public offering, its share price has been little changed from its listing price of 5,000 won. The REIT aims to expand its portfolio with new purchases from Belgium, Germany and the Netherlands.

Write to Jin-seong Kim at jskim1028@hankyung.com
Yeonhee Kim edited this article.