Paramount Group Surges 4.3% Amid Bidding War Report

Paramount Group shares rose 4.3% following a report that several bidders, including Vornado, SL Green, and Empire State Realty, are making offers for the REIT in the second round of the sales process.

Paramount Group (NYSE: PGRE) saw its shares climb 4.3% on Wednesday following a report that several major players in the commercial real estate sector are making offers for the real estate investment trust (REIT) in the second round of its sales process. According to a report from The Real Deal, citing sources familiar with the matter, Paramount Group has attracted bids from a roster of prominent potential acquirers including SL Green (NYSE: SLG), Empire State Realty Trust (NYSE: ESRT), Vornado (NYSE: VNO), Blackstone (NYSE: BX), and DivcoWest in partnership with Dubai-based Saray Capital and Rithm Capital (RITM) [1].

The report indicates that all bidders are large institutional investors, with most being REITs that have significant office property holdings in New York City. These companies would be positioned to integrate Paramount’s portfolio of approximately 13 million square feet of office space. Saray Capital, which is reportedly bidding alongside DivcoWest, had previously acquired a 5% stake in Paramount Group in May, establishing an earlier position in the company before this current sales process [2].

The advancement to a second round of bidding suggests the REIT’s sale process is progressing, contributing to today’s positive market reaction as investors respond to the potential for a transaction. This news comes after Paramount Group announced in May that it would start a review of strategic alternatives to maximize shareholder value [1].

Investors are likely to continue monitoring the situation closely, as the outcome of this bidding process could have significant implications for the real estate sector and the value of Paramount Group's shares.

References:
[1] https://seekingalpha.com/news/4489723-paramount-group-amid-report-sl-green-empire-state-among-bidders
[2] https://www.investing.com/news/stock-market-news/paramount-group-stock-rises-on-report-of-multiple-bidders-in-sale-process-93CH-4213211