SL Green and Vornado reportedly seeking to acquire Paramount Group

New York City’s largest office owners are currently expressing interest in acquiring Paramount Group, a struggling publicly traded real estate giant. With 13 million square feet of commercial property under its belt, Paramount Group has been exploring potential options for a sale or other strategic moves since May. Recent reports indicate that the company has entered the second round of bidding from prospective buyers.

Among the interested parties are some of the most prominent New York City-based real estate investment trusts (REITs) including Vornado Realty Trust, SL Green Realty Corp., and Empire State Realty Trust. According to reports, additional bidding entities include Blackstone, Rithm Capital, and a collaborative effort between DivcoWest and Saray Capital, the latter of which already holds a 5% stake in Paramount Group.

When approached for comments, Vornado Realty Trust and Rithm Capital opted to remain silent on the matter. Similarly, Paramount Group and the other bidding entities did not provide immediate responses when queried about the ongoing developments. Paramount Group, with real estate holdings in both New York and San Francisco, recently refinanced its 1301 Sixth Avenue property for a staggering $900 million. This move came on the heels of the office tower’s successful leasing efforts, resulting in an impressive 97% occupancy rate.

Despite these recent advances, Paramount Group’s financial struggles have been apparent for several years. The company reported a $38.6 million net loss at the conclusion of 2024. The situation worsened at the start of 2025, with a reported $29.8 million net loss for common stockholders in the first half of the year. Occupancy rates for their buildings also took a slight hit, dropping from 86.2% to 85.4% over a three-month period ending in June.

Although the company’s stock value has experienced a notable 40% increase this year, pushing its market capitalization to $1.4 billion, Paramount Group remains under a cloud of scrutiny. Allegations of undisclosed payments made to CEO Albert Behler, totaling $4 million for business-related and personal expenses, have surfaced. In a related development, Wilbur Paes and Gage Johnson, who held key executive positions within the company, resigned from their roles in May.

Further magnifying the company’s challenges, an investigation by the U.S. Securities and Exchange Commission (SEC) has been initiated. The investigation is reportedly focused on allegations of conflicts of interest and concerns over executive compensation disclosures, among other issues. This ongoing scrutiny from regulators comes at a critical time for Paramount Group, as the company navigates a complex landscape of financial setbacks and internal leadership changes.