UPDATES: 10/22/13, 9:48 a.m. EDT. The names of the lead lawyers from DLA Piper have been added to the eighth paragraph of this story. 10/23/13, 1:10 p.m. EDT. The 12th paragraph now includes the names of the lead in-house attorneys from Fosun.
JPMorgan Chase, which is on the precipice of a $13 billion mortgage settlement with the Justice Department, has sold its 60-story office tower at One Chase Manhattan Plaza in downtown New York to China’s Fosun International for $725 million.
Proskauer Rose is advising New York–based JPMorgan on the deal, while DLA Piper is taking the lead for Fosun—the firm’s second major real estate deal for a Chinese buyer in recent weeks. After the sale, JPMorgan will remain a tenant at One Chase, which was built by Chase Manhattan in 1961 under the leadership of former CEO David Rockefeller, according to sibling publication GlobeSt.
Ronald Sernau, cochair of Proskauer’s real estate department, is leading a team from the firm advising JPMorgan on the sale. Other Proskauer attorneys working on the deal include real estate partner D. Eric Remensperger, real estate senior counsel Craig Masheb, real estate special counsel Audrey Bender and associate Paul Polking. Sernau, one of New York’s top real estate lawyers, advised on the $1 billion sale of two Manhattan skyscrapers—including the headquarters of Simpson Thacher & Bartlett—earlier this year by commercial real estate firm Hines Interests Limited Partnership.
JPMorgan, the largest bank holding company in the United States, has been relying on teams of lawyers from Cravath, Swaine & Moore; Paul, Weiss, Rifkind, Wharton & Garrison, Sullivan & Cromwell; and Wilmer Cutler Pickering Hale and Dorr to handle an array of litigation and regulatory matters, according to reports by sibling publication The Am Law Litigation Daily. (The banking giant’s general counsel Stephen Cutler is a former cochair of Wilmer’s securities practice; Nina Shenker, general counsel of JPMorgan Asset Management, is married to S&C chairman Joseph Shenker.)
Chase Manhattan Corp. acquired J.P. Morgan & Co. in a $30.9 billion all-stock deal in 2000. The global headquarters of the combined JPMorgan Chase is at 270 Park Avenue, where Chase Manhattan moved in 1995.
One Chase, which sits atop a massive bank vault and is located across the street from The American Lawyer’s offices at the Equitable Building at 120 Broadway, serves as home base for New York’s Hawkins Delafield & Wood and Milbank, Tweed, Hadley & McCloy. Though reports surfaced two years ago that JPMorgan’s interest in taking new space in the building would force Milbank out, the Am Law 100 firm has been in negotiations to renew its lease in the office tower.
A call to Milbank litigation partner Scott Edelman—who took over as chairman of the firm earlier this year from longtime leader Mel Immergut—about the state of the firm’s lease was not returned by the time of this story. A Milbank spokeswoman declined to comment on the matter. The firm has roughly 300,000 square feet of space in the building, which was surrounded in May by striking legal services workers protesting against Milbank partner and public service head Joseph Genova, according to sibling publication the New York Law Journal.
Shanghai-based Fosun, a privately owned conglomerate controlled by Chinese billionaire Guo Guangchang, has turned to team of lawyers from DLA led by real estate partner Stephen Cowan, senior real estate counsel Andrew Levy, and senior associate Lillian Duan for counsel on its acquisition of One Chase. Paul Chen, an M&A partner with DLA in Palo Alto, is the relationship partner for Fosun, while New York real estate head Martin Polevoy advised another bidder in the process.
Polevoy, who joined a predecessor firm of DLA in 2004 from Swidler Berlin Shereff Friedman, currently serves as real estate counsel to the Port Authority of New York and New Jersey on the redevelopment of the World Trade Center site. He also advised The New York Times Company on the $175 million sale of its old headquarters at 229 West 43rd Street back in 2005.
DLA and Chen served as cocounsel with Weil, Gotshal & Manges earlier this year in advising Fosun and Paris-based AXA Private Equity on their proposed $735 million acquisition of French resort operator Club Méditerranée (commonly known as Club Med), according to sibling publication The Asian Lawyer.
The Asian Lawyer reported last week on DLA’s role advising Shanghai-based developer Greenland Holding Group on its $5 billion acquisition of a stake in Brooklyn’s Atlantic Yards development, the largest-ever U.S. real estate investment by a Chinese company. DLA and Cowan, the managing partner of the firm’s San Francisco office, are also representing Greenland on its negotiations for the sale of two empty lots near the Staples Center in downtown Los Angeles on which it plans to build a $1 billion housing, hotel, and office complex.
Yao Xu, deputy general manager of Fosun’s legal department, and senior director and head of real estate legal Jane Wang are leaing an in-house team working on the acquisition of One Chase. Fosun’s secretary is Mei Ming Sze and attorney Xuetang Qin serves as a senior vice president and executive director. David Zhang, a senior corporate partner with Kirkland & Ellis in Hong Kong, serves as a nonexecutive member of Fosun’s board of directors.
The New York Times and Bloomberg report that JPMorgan intends to move 4,000 employees who currently work in One Chase to other locations, leaving the property 70 percent vacant within a year. GlobeSt notes that the building was officially designated a landmark in 2009 by the New York City Landmarks Preservation Commission. JPMorgan had been looking to sell One Chase for several years.
The Am Law Daily reported last week on the dozens of Am Law 200 firms on the hunt for new space in New York and across the country.