Rithm Capital, a prominent global asset management firm, announced on September 17, 2025, its agreement to acquire real estate investment trust (REIT) Paramount Group for $1.6 billion in cash. The deal, which values Paramount Group at $6.60 per share, is expected to close by the end of the fourth quarter of 2025, pending shareholder approval. This acquisition marks a significant move for Rithm Capital as it continues to expand its footprint in the commercial real estate sector.
Paramount Group, based in New York City, owns and redevelops office properties in select central business district submarkets of both New York City and San Francisco. The company’s portfolio includes 13 owned and four managed office properties, totaling more than 13.1 million square feet of office space. As of June 30, 2025, Paramount’s occupancy rate stood at 85.4%, reflecting a solid but cautious demand for office space in the current market.
The acquisition comes at a time when the U.S. office real estate market faces significant challenges, such as rising interest rates and the ongoing trend of remote work, which have led to higher vacancy rates and declining rents in some markets. Despite these headwinds, Rithm Capital views this acquisition as an opportunity to capitalize on a potential rebound in the office market. The firm believes that with the right management and strategic repositioning, Paramount’s properties can benefit from an eventual recovery, making the deal an attractive long-term investment.
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Rithm plans to fund the $1.6 billion acquisition through a combination of cash reserves, existing liquidity, and potential co-investors, highlighting the firm’s financial strength and confidence in the deal. Michael Nierenberg, CEO of Rithm Capital, stated that the acquisition is in line with the company’s broader strategy of expanding its commercial real estate and asset management platform, further diversifying its portfolio to include high-quality office assets in prime urban markets.
This move is being seen by some industry experts as a sign that the worst of the crisis in office real estate may be behind us. Investors, who have been cautious about the office sector in recent years due to the impact of remote work and hybrid work models, are beginning to show renewed interest in the market. By acquiring Paramount Group, Rithm Capital is positioning itself as one of the key players in this potential market rebound, with a solid base of office properties in two of the country’s most important commercial hubs.
As the deal progresses toward closing, all eyes will be on how Rithm plans to navigate the evolving challenges of the office real estate market, particularly in terms of adapting to changing workplace trends and capitalizing on opportunities for property redevelopment. With this acquisition, Rithm Capital continues to demonstrate its commitment to expanding its presence in the commercial real estate sector and its belief in the sector’s long-term viability.
