Saudi Arabia’s Public Investment Fund is taking a commanding stake in a planned 1,200-foot Manhattan skyscraper, marking another major foreign capital play in the city’s rebounding commercial market.
The $1 trillion sovereign wealth fund is partnering with Related Companies on the Central Park-adjacent site at 625 Madison Avenue to take a two-thirds stake in the project, the Wall Street Journal reported. The developer purchased it last year for more than $600 million.
PIF has already invested approximately $200 million into the project, though the final contribution is still under negotiation. The overall all-in cost is expected to exceed $1 billion.
Related initially planned a mixed-use project combining residential, retail and hospitality components, but has more recently said it would deliver an office building to capitalize on demand for premium Manhattan workspaces.
PIF’s deal underscores foreign investors’ return to New York commercial real estate after a prolonged drought. Foreign capital poured more than $2.1 billion into Manhattan commercial properties during the first quarter of 2025 and fourth quarter of 2024 combined. That’s five times the volume from the same period two years earlier, according to MSCI data.
The market recovery follows a brutal period when pandemic disruptions and soaring interest rates starting in 2022 crushed property values and scared off international investors. But Manhattan’s fundamentals have strengthened as office workers return and leasing activity picks up.
PIF maintains a close relationship with Related, established through a 2020 debt investment convertible into a 15 percent equity stake. The fund has consulted with Related on numerous projects since.
The Saudi fund recently expanded its global real estate footprint, taking a 40 percent stake in UK luxury retailer Selfridges last year. It also invested $900 million in ultraluxury hotelier Aman in 2022 and acquired a 4 percent stake in upmarket hotel chain Rocco Forte in 2023.
Saudi Arabia’s ambitious $500 billion city of the future, Noem, is facing its own set of issues. The project, roughly equivalent to the size of Massachusetts, is billed as a futuristic city with its own set of laws and a liberal environment, but is struggling to attract and retain talent due to its remote location, cultural challenges and the political controversy dogging the country.
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