Abu Dhabi Buying New York’s Chrysler Building

With oil prices at current levels, some countries are awash with cash. Abu Dhabi, part of the United Arab Emirates, is one of them. The Abu Dhabi Investment Council, which handles most of the funds for the country, has been talking to TMW, the German arm of an Atlanta-based investment fund, about buying a three-quarters stake in the Chrysler Building in New York City. Economic nationalists may shriek, but this isn’t the same as selling off control of US ports. In fact, the US has seen this before, and it’s no big deal.

Back in the 1980s, America had all the cheap oil it could want, but those darned Japanese were out-hustling and out performing American businesses. Having lost their bid for military control of the Pacific in the 1940s, the Japanese appeared to have hit upon a better idea – they’d buy everything. Indeed, a majority stake in Rockefeller Center in Manhattan become the property of The Mitsubishi Estate Company of Japan.

The New York Times reported back on October 31, 1989, “Richard A. Voell, Rockefeller's president and chief executive, said Mitsubishi would pay $846 million in cash for a 51 percent interest. The proceeds will go into the family trusts established by John D. Rockefeller Jr. in 1934 and be used to diversify the family's holdings.” In other words, the Rockefellers needed cash.

On September 12, 1995, not quite six years later, the same paper reported, “The Mitsubishi Estate Company of Japan plans to walk away from its almost $2 billion investment in Rockefeller Center, the Hope diamond of world real estate. Mitsubishi proposed yesterday afternoon that it pass ownership of the Manhattan property to Rockefeller Center Properties Inc., the publicly traded real estate investment trust that holds the $1.3 billion mortgage on the center, according to advisers involved in the negotiations to bring Rockefeller Center out of bankruptcy protection.”

So, there’s no need for nationalist ranting here. If the Abu Dhabi Investment Council wants the Chrysler Building, let them have it. It can’t be shipped to the Mideast, and when the market turns (and someday it will), there’s a fair chance it will prove to be a losing investment.

At the same time, there are reports that Europe’s InBev is mounting a takeover of brewer Anheuser-Busch to take advantage of the strong euro and the weak dollar. That would be welcome as well – especially if they can make Budweiser taste like Stella Artois.

© Copyright 2008 by The Kensington Review, Jeff Myhre, PhD, Editor. No part of this publication may be reproduced without written consent. Produced using Fedora Linux.

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