SAN FRANCISCO (MarketWatch) -- Boston Properties said Saturday it has reached a deal to buy the landmark General Motors building and three other Midtown skyscrapers from high-profile New York developer Harry Macklowe for $3.95 billion in cash and debt.
Macklowe will be able to use proceeds from the deal to repay some of the $7 billion he borrowed last year to purchase seven Manhattan towers from the Blackstone Group , as part of Blackstone's acquisition of Equity Office Properties Trust. These included short-term, high-interest loans from Fortress Investment Group and Deutsche Bank in which the GM building and other towers were used as collateral, according to media reports.
Boston Properties will pay $1.5 billion in cash and assume about $2.5 billion in debt, the company said in a statement. The real estate company's partners include Goldman Sachs, the Kuwait Investment Authority and a Qatari sovereign wealth fund, The Wall Street Journal reported, citing people familiar with the situation. The GM deal is expected to close in June, with the purchase of the other properties closing shortly after.
Macklowe purchased the highly coveted, 2 million-square-foot GM building in 2003 for $1.4 billion.
Boston Properties is also purchasing Macklowe properties at 540 Madison Ave., 125 W. 55th St. and 2 Grand Central Tower. The GM building is at 767 Fifth Ave. 
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