Forbes Asia August 2017

76 | FORBES ASIA AUGUST 2017

DAVID ARKY FOR FORBES

WHEN THE CONGLOMERATE

Mitsubishi Estate struck a deal to

take control of Manhattan’s Rocke-

feller Center in late 1989, it capped

a decade of go-go acquisition of U.S.

trophy assets—Firestone Tire & Rub-

ber, Columbia Pictures and plum real

estate—by Japanese corporations.

This deal, struck just weeks before

Japan’s stock market cratered, would

prove hubristic, landing the iconic

building complex in bankruptcy.

A Piece of the Rock

4. SECOND TIME AS FARCE?
   Today foreign buyers are once again looking to park
   their cash in prestige Manhattan properties. Three years
   ago, the unheralded Chinese conglomerate Anbang In-
   surance Group inked a startling $1.95 billion deal for the
   Waldorf-Astoria hotel. The deal is part of a new wave of
   Asian money. Since 2014, according to Dealogic, compa-
   nies from China have plowed $100 billion into U.S. assets.


5. CASHING OUT, CASHING IN
   Owned by the Rockefeller
   family for decades, the build-
   ings became a liquidity spigot
   in 1985, when dozens of heirs
   extracted $1.3 billion from
   them via a mortgage held in
   a publicly traded real estate
   investment trust. In 1989, the
   family opted to cede control,
   selling an 80% share of holding
   company Rockefeller Group
   to Mitsubishi for $1.4 billion.


6. CHILD OF THE DEPRESSION
   Built on derelict midtown Manhattan land leased in late
   1929 from Columbia University, Rockefeller Center was
   planned as the home of the Metropolitan Opera. As the
   Depression began to bite, though, John D. Rockefel ler Jr.
   (son of the original oil titan) boldly shifted focus.
   Selling Standard Oil shares at heavy losses, Rockefeller
   personally covered three quarters of the $125 million con-
   struction cost ($2.1 billion today) to erect a 12-building
   Art Deco masterpiece that employed 40,000 construc-
   tion workers through the tumult of the early 1930s.


7. BUYER’S REMORSE
   Bullish on America, Mitsubi-
   shi envisioned eventual Rock
   Center rents of $100 per
   square foot (they were about
   $33 when the deal closed),
   but a sharp early-’90s U.S.
   real estate recession dictated
   otherwise. In 1995, Mitsubishi
   defaulted on the complex’s
   mortgage, sparking a bidding
   war for control among billion-
   aires David Rockefeller (John
   Jr.’s son), Jerry Speyer and
   Sam Zell (as well as 28-year-
   old agitator Bill Ackman).
   A year later, the victor was
   a consortium led by Rocke fel-
   ler, commercial-property giant
   Tishman Speyer and Goldman
   Sachs. In 2000, Tishman Spey-
   er and Chicago’s Crown family
   bought Rockefeller Center
   outright for $1.85 billion.

l

DEAL TOY

BY ANTOINE GARA

FORBES ASIA