Paramount Group Shareholders Approve $1.6B Rithm Acquisition

Paramount Group shareholders approved the office giant’s sale to Rithm Capital for $1.6 billion, or $6.60 per share, according to a Tuesday filing from Paramount. Approval follows a September announcement from Rithm Capital that the sale would take place.

While approving the sale, the shareholders voted down a $34 million exit package for CEO Albert Behler, although it appears Behler will receive the full golden parachute anyway.

The sale, initially announced Sept. 17, leaves Rithm with Paramount’s 13 Class A office properties as well as four others managed by the company, a portfolio spanning over 13.1 million square feet in total. As of June 30, 85.4 percent of this space was leased, according to the announcement at the time from Rithm.

Rithm is expected to fund the transaction “with a combination of cash and liquidity from Rithm’s balance sheet and potential opportunities from co-investors,” according to the announcement.

Michael Nierenberg, Rithm’s CEO, called the purchase “a generational opportunity that will serve as a springboard to build out our commercial real estate and asset management platform,” in the announcement. “The Paramount portfolio is situated in cities where we have a strong conviction in the recovery of office market fundamentals, including improving rent rolls, a more favorable interest rate environment and increasing demand.” 

The law firm Latham & Watkins, according to a September announcement of its own, advised Paramount Group in various aspects of the transaction, and Commercial Observer reported in late August that Paramount Group had hired Bank of America as its financial adviser for the sale.

The sale was approved despite a competing offer from Dubai-based investment firm Saray Capital, according to Crain’s New York Business. Saray, which owns a 5.4 percent stake in Paramount Group, reportedly offered $6.95 per share, but Paramount’s board rejected the offer due to “material deficiencies,” including a “lack of committed financing,” according to Crain’s.

In March 2025, Crain’s reported that Paramount had made over $4.6 million in “previously undisclosed payments to outside companies owned by CEO Albert Behler,” including over $3 million to an aviation company 50 percent owned by the CEO, and $1.6 million to a Behler-owned consulting firm.   

The publication also reported that the company paid at least $425,000 to a firm owned by Behler’s wife for design services, and that Paramount paid $12,000 for “wine from Behler’s vineyard in Germany.”

In the latest article, Crain’s notes that Paramount was cooperating with an Securities and Exchange Commission investigation of “the adequacy of its disclosures,” and that “shareholders were infuriated by the news” of the payments, with the board putting the company up for sale two months later.

The publication also noted that the shareholder vote on Behler’s exit package was “nonbinding,” and that Paramount had declared in a filing that regardless of the outcome of the vote, “it intends to grant Behler his reward so long as the sale of the company is approved.”

Some of the buildings owned by Paramount Group, which was founded in 1978, include 31 West 52nd Street, 1301 Avenue of the Americas, 1325 Avenue of the Americas, 1633 Broadway, 745 Fifth Avenue and 1600 Broadway, according to the company website. 

Behler joined Paramount as president and CEO in 1991.

Larry Getlen can be reached at lgetlen@commercialobserver.com.