JPMorgan Chase has agreed to sell 1 Chase Manhattan Plaza, the tower built by David Rockefeller, to Fosun International, the investment arm of China's biggest closely held industrial group, for $725 million.
Fosun, which invests in properties, pharmaceuticals and steel, is buying the 60-story, 2.2 million square-foot, lower Manhattan tower, according to a statement it filed to Hong Kong's stock exchange.
China's developers and companies are expanding in overseas property markets as the government maintains curbs on housing at home to cool prices. Greenland Holding Group Co., a Shanghai- based, state-owned developer, this month agreed to buy a 70 percent stake in a residential and commercial real estate project in Brooklyn.
"There's a lot of excess capital in China that needs a way out at the moment," Simon Lo, Hong Kong-based executive director for Asia research and advisory at property broker Colliers International, said in a phone interview today. "Also, by investing in markets like New York, they believe they can gain from the recovery of the U.S. economy and real estate market."
Fosun, owned by Chinese billionaire Guo Guangchang, fell 0.3 percent to HK$6.79 at the midday trading break in Hong Kong. Shares in the Shanghai-based company have gained 37 percent this year, compared with the 2.6 percent increase in the benchmark Hang Seng Index.
Over the past year, other Chinese developers and wealthy investors have been buying real estate in the U.S.
China Vanke Co., the biggest homebuilder listed in mainland China, said in February it joined a residential real estate venture in San Francisco. The families of Zhang Xin, co-founder of Soho China Ltd., the biggest developer in Beijing's central business district, and Brazilian banking billionaire Moise Safra this year bought a 40 percent stake in New York's General Motors Building.
The landmark 1 Chase Manhattan Plaza, designed by architect Gordon Bunshaft and built in the 1950s, was once the headquarters of Chase Manhattan Bank. Rockefeller, as head of the bank's building committee, selected the site and oversaw its construction.
JPMorgan intends to relocate about 4,000 employees, most of the people who work in the 60-story skyscraper, to other New York locations, Brian Marchiony, a spokesman, said in August. JPMorgan occupies about half of its space.
Jane Zhang, a Shanghai-based spokeswoman for Fosun, declined to comment on how the company plans to use the building when contacted by Bloomberg News by phone.
An e-mail sent after business hours in New York to Joseph Evangelisti, a JPMorgan spokesman, wasn't immediately returned.