Tall buildings - the financial returns are not good

Office Building 666 on Fifth Avenue Value over the years

1976 - $80 mn ($530 mn real value)

2000 - $518 mn ($830 mn real value) : 2% CAGR return from 1976 to 2000

2006 - $1,800 mn ($2,200 mn real value) : 18% CAGR from 2000 to 2006

2017 - $2,850 mn : 2.5% CAGR from 2006 to 2017


Note: For the most part, the returns were very low. Similar to government bonds. So, no point in taking additional risk?

Owners:

1957: Tishman family via Tishman Realty and Construction built the building

1976: Tishman sold it in 1976; Japanese realty and development company Sumitomo purchased in late 1980s

2000: The newly reconstituted Tishman Speyer Properties bought the building along with the German investment firm TMW

2006:  Kushner Properties (at the time the highest price ever paid for an individual building in Manhattan)

2017:  reports were made that Anbang Insurance Group of China was in talks to purchase an interest in the building

Note: Financial partners like investment firms and insurance firms are required in such large transactions. Only they have such large funds and are fine with low returns with low risk.

https://en.wikipedia.org/wiki/666_Fifth_Avenue