Rithm Capital Corp. has recently announced its definitive agreement to acquire Paramount Group, Inc. for approximately $1.6 billion. This acquisition is expected to provide Rithm with a substantial class A office portfolio in key markets, expanding and diversifying its commercial real estate footprint and asset management capabilities.
Paramount's portfolio encompasses 13 owned and 4 managed high-quality office assets, totaling more than 13.1 million square feet, with a current lease rate of 85.4% as of June 30, 2025. The transaction, which is anticipated to close in late Q4 2025, is subject to customary closing conditions, including the approval of Paramount’s common stockholders.
Rithm plans to fund the acquisition with a combination of cash, liquidity from its balance sheet, and potential opportunities from co-investors. The addition of Paramount's portfolio is expected to create new opportunities for investors to access Rithm’s real estate platform and strengthen its asset management business.
The acquisition is seen as a significant opportunity for Rithm to build out its commercial real estate and asset management platform, especially in cities where there is confidence in the recovery of office market fundamentals.
The financial advisors for Rithm in this transaction are UBS Investment Bank and Citigroup Global Markets Inc., with legal counsel provided by Skadden, Arps, Slate, Meagher & Flom LLP. On the other side, BofA Securities is acting as the exclusive financial advisor to Paramount and a transaction committee of the board, and Latham & Watkins LLP is serving as legal counsel to Paramount.
Rithm Capital Corp. is a global alternative asset manager with extensive experience in managing credit and real estate assets. The firm's integrated investment platform spans across asset-based finance, lending across residential and commercial real estate, mortgage servicing rights (MSRs), and structured credit.
Headquartered in New York City, Paramount Group, Inc. is a fully integrated real estate investment trust that focuses on owning, operating, managing, acquiring, and redeveloping high-quality, class A office properties in select central business district submarkets of New York City and San Francisco.
The proposed transaction is expected to be submitted to the stockholders of Paramount for their consideration and approval at a special meeting. Paramount will file with the Securities and Exchange Commission (SEC) a proxy statement on Schedule 14A, and investors and security holders are urged to read the proxy statement and any other relevant documents in connection with the proposed transaction.
This acquisition marks a significant milestone for Rithm Capital as it seeks to expand its presence and capabilities in the commercial real estate and asset management sectors. Following these announcements, the company's shares moved 4.23%, and are now trading at a price of $7.39. Check out the company's full 8-K submission here.
