CHRYSLER BUILDING ON THE BLOCK SOVEREIGN ARAB FUND TO PAY $800M

NY Post ^ | June 11, 2008 | LOIS WEISS

[COUNTrecount]

The latest Big Apple trophy being coveted by oil-rich sovereign wealth funds is the landmark Chrysler Building.

Sources say the super-rich Abu Dhabi Investment Council is negotiating an $800 million deal for a 75 percent stake in the Art Deco treasure that has defined the Midtown skyline since 1930.

The Chrysler assets would be purchased from TMW - the German arm of an Atlanta-based investment fund that's been eager to cash out of its Chrysler stake.

The deal follows last month's sale of the GM Building and three other Macklowe/Equity Portfolio properties for $3.95 billion to a group of investors including the wealth funds of Kuwait and Qatar and Boston Properties.

As part of the Chrysler deal, sources said the Abu Dhabi Investment Council would also get part of the skyscraper's signature Trylons retail prize next door.

[COUNTrecount]

This is a fantastic idea. We should sell all of our largest skyscrapers to middle-eastern ultra-rich muslims. Maybe then Al Qaeda won't want to fly planes into them...

[Biggirl]

...Of course, since the Muslim terrorists would KNOW that those buildings would be making jizyra money for them.

[2banana]

Didn't the japanese do the same exact thing - right at the exact wrong moment and lost their shirts a few years later?

[Dixie Yooper]

Or they can make the skyscraper fall in any direction they want....

[Jimmy Valentine]

Will they get to rename the buyilding the “Abu Dhabi Station?” ;^)

[Eric in the Ozarks]

Yes. They bought golf courses, hotels, etc. Lost their a**.

[1rudeboy]

I wish I could remember the writer who observed, years and years ago, that it is uniquely American to sell someone something for $10, and buy it back later for $5.

[jalisco555]

Didn't the japanese do the same exact thing - right at the exact wrong moment and lost their shirts a few years later?

Exactly what I was thinking. Back then we were being told that America was finished and the Japanese were about to take over as the world's leading economic power. Right after that the Japanese bubble burst. Methinks history might just be about to repeat itself.

[Centurion2000]

Didn't the japanese do the same exact thing - right at the exact wrong moment and lost their shirts a few years later?

Yes they did. Pissed them right off too. Actually was part of the plot for Clancy's Debt of Honor.

[Alberta's Child]

They didn't have much of a choice in the matter. When a foreign country maintains a huge trade surplus with the U.S. it has to do something reasonably productive with the extra money they get (they sure can't eat U.S. dollars, can they?).

As their trade imbalance with the U.S. grows, they are basically forced to pay inflated prices for U.S. assets.

[Eric in the Ozarks]

When Bridgestone bought Firestone back in the 70s, the company was broke, had no new products, had just gone through a recall of hundreds of thousands of Firestone 500 tires, didn't have a radial tire and, were it not for the relationship with Ford Motor, would have been completely DOA.
Yet, the Japanese paid something near full value for the stock, around $70/share, as I recall. It took almost 30 years to recoup this "investment."

[beekay]

Let’s keep sending them our money while we continue to prohibit Alaska from developing ANWAR and prohibit domestic oil cmpanies from doing the same drilling offshore that the Chinese are doing. At $130 a barrel we can no longer afford our incompetent politicians.

[manic4organic]

They’ll change that spire into a minaret.

[Roninf5-1]

Remember when America used to build things like this:
http://en.wikipedia.org/wiki/Burj_Dubai

I guess when we’ve sold off all the skyscrapers, factories, highways, and water districts to foreigners that will mean our economy is really cookin’!

[JerseyHighlander]

There will be no comparison to the Japanese foray. The situation is much different, and this time much better for the foreign investment funds.

The Oil country sovereign wealth funds are buying at a market low, the japanese bought at US bubble prices at the height of a Japanese real estate bubble, and the private Japanese investor class were thinking short term. The Arabs have real wealth in them their oil, they also have no home country taxes to pay, no home country shareholders OR stakeholders to be held accountable towards, and have free reign to ride out long term economic fluctuations.

Outside of a sharia revolution taking over the Arab countries and the sovereign wealth funds and banning investing in the US do to sharia finance law compliance, or some type of nativist revolution in the USA that leads to confiscation like what happened to the properties owned by Japanese before WWII, these US assets bought by Arab sovereign funds will be owned by these funds in perpetuity as long as there is a potential for positive cash flow.

The Arabs will own those properties for as many generations as they want.

[VegasCowboy]

Yep. This quote from PJ O’Rourke sums it up nicely. Of course, the difference today is that the real estate bubble has already deflated.

“Adam Smith, were he alive, would have us consider the parable of Japan in the 1980s. The Japanese kept giving us radios, TVs, stereos, and cars, and we kept giving them money. The Japanese didn’t want anything American except Michael Jackson audio cassettes...So the Japanese decided to buy America itself. They bought office complexes, golf courses, and hotels. The Japanese bid up the price of American real estate until the bubble did what bubbles do. By the 1990s America had all the radios, TVs, stereos, and cars, and all the office complexes, golf courses, and hotels, and all the money, too.” - PJ O’Rourke