Friends in faraway places

To develop its record-breaking US real estate project, Related Companies relied on an global network of investors.

In building the largest private real estate development in US history, going it alone was not an option for Related Companies. The massive project – which would encompass 18 million square feet of commercial and residential space and one million square feet of retail space upon completion, among other components, on the West Side of New York City’s Manhattan – comes with a hefty $20 billion price tag. In seeking capital sources to pay for the project, Related found most of its partners not at home, but overseas.

“There’s not enough domestic capital to fund large-scale projects,” said Jeff Blau at the PERE America conference in New York last month. Close to 80 percent of the capital for Hudson Yards, he noted, came from foreign investors.

During the hard-hat tour of the project, Blau stood in front of a map of Hudson Yard’s first phase and gave a brief overview of the project’s financial backers. Investors spanned the globe, from Canada’s Oxford Properties Group to the Kuwait Investment Authority to America’s own EB-5 program, from which Related raised capital from Chinese investors to fund the project’s platform and retail portions of the project. As New York City has benefited richly from globalization, so has Hudson Yards.