Rithm Capital has announced its acquisition of Paramount Group, a real estate investment trust (REIT) with a significant portfolio of office properties in New York City and San Francisco, for $1.6 billion in cash. This move is a strategic bet on the recovery of the office space market, despite ongoing challenges such as rising interest rates and the increasing prevalence of remote work.
The deal, which values Paramount at $6.60 per share, represents a 10.7% discount to its last closing price. With the transaction expected to close by the end of Q4 2025, Rithm Capital intends to finance the acquisition through a mix of cash, existing liquidity, and co-investors. Paramount’s portfolio includes 13 owned and four managed office buildings, totaling over 13.1 million square feet, with an occupancy rate of 85.4% as of mid-2025.
This acquisition is part of Rithm Capital’s broader strategy to expand its commercial real estate holdings and asset management platform, positioning itself for potential growth as the office market navigates the post-pandemic landscape. While the sector has faced challenges, Rithm sees an opportunity to capitalize on the eventual recovery of office space demand, particularly in key urban markets like New York and San Francisco.
As Rithm Capital continues to refine its real estate strategy, this acquisition demonstrates a proactive approach in tapping into high-value assets that could yield significant returns as market conditions improve.
