HSBC tried to sell the bank’s London headquarters but ended up foreclosing. Now the bank is selling HSBC’s Manhattan New York headquarters, with HSBC leasing back the property for at least ten years. The Manhattan deal comes with an interesting twist. HSBC must consider a sale and lease-back agreement with an Israeli company while attempting to gain a foothold in Arab countries.
Koor and Property and Building are both subsidiaries of Israeli holding company IDB Holding Corp. Israel’s Koor Industries and Property and Building said on Sunday they had signed a deal to acquire from HSBC the bank’s headquarters in Manhattan for $330 million.
When I lived in Saudi Arabia (my Dad worked as a contractor in the oil business) the Saudis allowed Pepsi in the country, but not Coca-Cola. Why? Pepsi had no ties to Isreal, but Coca-Cola did. No pork, no alcohol, no Coke.
How will this deal effect HSBC on a global scale? Time will tell. How strict are Muslem nations and countries with Muslem populations? How will this deal effect Sharia finance and HSBC?
“The IDB group has been operating in recent years, alongside its holdings in leading properties in Israel, to diversify its investments abroad by taking advantage of business opportunities created by the global economic crisis,” IDB said in a statement on Saturday.
HSBC will remain the main tenant in the building for 10 years with an option to extend its lease. IDB said it will receive $45 million in rental income in the first year while operating expenses will total $18.5 million.
Related posts:
