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China's Largest Conglomerate Buys Building Housing JPMorgan's Gold Vault

Tyler Durden's picture


In what is the most remarkable news of the day, which has so far passed very quietly under the radar, Fosun International, China's largest private-owned conglomerate which invests in commodities, properties and pharmaceuticals also known as "Shanghai's Hutchison Whampoa", announced in a statement filed just as quietly with the Hong Kong stock exchange, that it had purchased JPM's iconic former headquarters, the tower built by none other than David Rockefeller, at 1 Chase Manhattan Plaza for a measly $725 million.

Here is Bloomberg described the transaction:

Over the past year, other Chinese developers and wealthy investors have been buying real estate in the U.S.


China Vanke Co., the biggest homebuilder listed in mainland China, said in February it joined a residential real estate venture in San Francisco. The families of Zhang Xin, co-founder of Soho China Ltd. (410), the biggest developer in Beijing’s central business district, and Brazilian banking billionaire Moise Safra this year bought a 40 percent stake in New York’s General Motors Building.


The landmark 1 Chase Manhattan Plaza, designed by architect Gordon Bunshaft and built in the 1950s, was once the headquarters of Chase Manhattan Bank. Rockefeller, as head of the bank’s building committee, selected the site and oversaw its construction.


JPMorgan intends to relocate about 4,000 employees, most of the people who work in the 60-story skyscraper, to other New York locations, Brian Marchiony, a spokesman, said in August. JPMorgan occupies about half of its space.

None of this is particularly newsworthy What is, however, is what Zero Hedge exclusively reported back in March, namely that the very same former JPM HQ at 1 Chase Manhattan Plaza is also the building that houses the firm's commercial gold vault: incidentally, the largest in the world.


What do we know about 1 Chase Manhattan Plaza. Well, aside from the fact that the 60-story structure, built in the 1950s, was the headquarters of the once-legendary Chase Manhattan corporation, and which when it was built was the world's sixth tallest building, not much.

So we set off to learn more.

To learn more, we first went to the motherlode: the Landmarks Preservation Commission, whose report on 1 CMP describes everyone one wants to know about this building and then much more, such as that:

One Chase Manhattan Plaza combines three main components: a 60-story tower, a 2½ acre plaza, and a 6-story base, of which 5 floors are beneath grade.

So the old Chase HQ, once the stomping grounds of one David Rockefeller, and soon to be the other half of JPMorgan Chase, has 5 sub-basements, just like the NY Fed...

Reading on:

Excavations, said to be the largest in New York City history, reached a depth of 90 feet

Or, about the same depth as the bottom-most sub-basement under the NY Fed...

But then we hit the jackpot:

Originally constructed with white marble terrazzo paving and enclosed by a solid parapet of white marble travertine that was personally selected by Bunshaft in Tivoli, Italy, the L-shaped plaza levels the sloping site and conceals six floors of operations that would have been difficult to fit into a single floor of the tower, including an auditorium seating 800 [and] the world’s largest bank vault.

And there you have it: the JPM vault, recommissioned to become a commercial vault, just happens to also be the "world's largest bank vault."

Digging some more into the curious nature of this biggest bank vault in the world, we learn the following, courtesy of a freely available book written by one of the architects:

On the lowest level was the vault, which rested directly on the rock - the "largest bank vault in the world, longer than a football field." It was anchored to the bedrock with steel rods. This was to prevent the watertight, concrete structure from floating to the surface like a huge bubble in the event that an atomic bomb falling in the bay would blow away the building and flood the area.

In other words, the world's biggest bank vault, that belonging to the private Chase Manhattan empire, and then, to JPMorgan, was so safe, the creators even had a plan of action should it sustain a near-direct hit from a nuclear bomb, and suffer epic flooding (such as that from Hurricane Sandy).

* * *

So, what the real news of today is not that JPM is selling its gold vault, we knew that two months ago, or that it is outright looking to exit the physical commodities business, that too was preannounced. What is extremely notable is that in one very quiet transaction, China just acquired the building that houses the world's largest gold vault.

Why? We don't know. We do know that China's gross gold imports from Hong Kong alone have amounted to over 2000 tons in the past two years. This excludes imports from other sources, and certainly internal gold mining and production.

One guess: China has decided it has its fill of domestically held gold and is starting to acquire gold warehouses in the banking capitals of the world.

For now the reason why is unclear but we are confident the answer will present itself shortly.

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Fri, 10/18/2013 - 13:56 | 4069549 TaperProof
TaperProof's picture

Welcome our new owners, call them master.

Fri, 10/18/2013 - 13:59 | 4069562 MeMadMax
MeMadMax's picture

Ladies and Gentlemen, it gives me great pleasure to introduce you to my new "Must Read" book of the day: "Mandarin, For Dummies"!

Fri, 10/18/2013 - 14:02 | 4069585 Enslavethechild...
EnslavethechildrenforBen's picture

Personally I will be ecstatic when China does go on the Gold Standard, even if that does require me to learn How to read those funny symbols.

Fri, 10/18/2013 - 14:07 | 4069610 Pinto Currency
Pinto Currency's picture

Now they can demand delivery or else they'll dump all their treasuries.

Fri, 10/18/2013 - 14:27 | 4069642 The Juggernaut
The Juggernaut's picture

THAT'S why Jim Rogers moved to Singapore... Do you think Chinese military will guard that area... you know like how American troops guard oil in Iraq...?

But kinda weird... Why didn't the Chinese just build a bigger one... or did they?

Fri, 10/18/2013 - 14:28 | 4069686 New England Patriot
New England Patriot's picture

It's a FOB.

Fri, 10/18/2013 - 14:30 | 4069687 12ToothAssassin
12ToothAssassin's picture

Gold vaults in world banking capitols? Must be preparing for a gold backed world reserve currency.

Fri, 10/18/2013 - 14:32 | 4069693 Pinto Currency
Pinto Currency's picture

How about this scenario:

China moves its real physical into 1 CMP.

They agree to lend it to NY Fed for audit purposes in return for being allowed to make massive purchases of US assets with Chinese held paper.

Fri, 10/18/2013 - 14:40 | 4069724 qussl3
qussl3's picture

It's plausible but it makes the assumption that the US would willingly engage in miltech transfer which they wont, and that the Chinese believe that their property rights will be respected when push comes to shove.

Unless there's something going on behind the scenes like the US literally having a killswitch on the Chinese leadership, this theory doesnt hold up too well.

Fri, 10/18/2013 - 14:46 | 4069740 Manthong
Manthong's picture

For some strange reason, I don't think they will be disposed towards keeping any of their gold in the US,

They could put a pretty rifle range down there, though - the noise would never disturb the neighbors.

Fri, 10/18/2013 - 14:57 | 4069792 kralizec
kralizec's picture

It went for a paltry $725m because the vault is empty...


Fri, 10/18/2013 - 15:04 | 4069820 SWRichmond
SWRichmond's picture

Maybe they're going to keep their gold in the US, just like Germany...after all, we're such trustworthy custodians.

Fri, 10/18/2013 - 15:37 | 4069927 SafelyGraze
SafelyGraze's picture

when they go down to the vault, they are in for a surprise


Fri, 10/18/2013 - 15:57 | 4070002 BaBaBouy
BaBaBouy's picture

Chinese Now Can BUY All US GOLD And Not Have
To Give Their Game Away.
Just Stash It Right Here Until The Time Is Right
And The Price Is Right ... $50K ...
G E N I U S !!!

Fri, 10/18/2013 - 16:01 | 4070016 bank guy in Brussels
bank guy in Brussels's picture

China is paying for Chase building with US Treasury Bond, which is on Chinese internal books as having long term value = 0

So 'real cost' of building in China's terms is 0, building is free

China gets rent and use of building for short- to medium-term - so profit and win for China

China estimates 40% chance of future US seizure of all Chinese assets in USA ... assets mostly bought for 'free' with marked-to-zero US Treasury bonds

When Chinese assets are seized, China gets to trumpet to the world that US is confirmed as thieving government with no rule of law, that cannot be trusted (world half thinks that already) ...

So US building confiscation creates global win for China, soon to be trusted global business leader in place of the USA

Perfect Chinese plan

Fri, 10/18/2013 - 16:16 | 4070062 ApollyonDestroy
ApollyonDestroy's picture


Fri, 10/18/2013 - 16:19 | 4070072 Pinto Currency
Pinto Currency's picture


America has the most productive economy in the world.

They could buy huge swaths of that economy with some of their gold when gold is revalued.

Fri, 10/18/2013 - 16:53 | 4070168 Ying-Yang
Ying-Yang's picture

Sure.... sure, We be happy to house a bunch of your gold here in the good ol USA.

It will be right nice and plenty safe.

Fri, 10/18/2013 - 20:30 | 4070281 Pinto Currency
Pinto Currency's picture


Perhaps China could just sell say 1/10 of their gold for ownership of 1/2 of US industry after the gold revaluation.

Barry would probably be all over that given his marxist roots.

Desperate times call for despotic measures.

The best part will be to listen to Barry berate everyone for the crash after he has run the whole show off the cliff.


p.s. in the comment 2 blocks above I said "They could buy huge swaths of that economy with some of their gold when gold is revalued."  I mean "China could buy huge swaths of that economy with some of their gold when gold is revalued."

Fri, 10/18/2013 - 23:47 | 4071221 James
James's picture

Read up on China "Special Enterprise Zones" here in the U.S.

My last count was about 60 of them.

These allow Chinese to set up shop on U.S. soil w/Chinese laws. No EPA for example.

Fri, 10/18/2013 - 15:37 | 4069928 strannick
strannick's picture

Bloomberg, CNBC et all found this unnewsworthy...

I @#$%ing LOVE Zerohedge

Fri, 10/18/2013 - 15:06 | 4069826 FEDbuster
FEDbuster's picture

That does seem a bit cheap.  Wonder how much of the building is empty, besides the gold vaults?  Maybe they are going to do a condo conversion on the top 2/3 of the building and sell them to investors (suckers) in Asia?

Fri, 10/18/2013 - 17:33 | 4070305 Urban Redneck
Urban Redneck's picture

Perhaps they bought the vault because they are getting frustrated by the slow rate of withdrawing German gold from FRBNY (matched only by the even slower rate at which Germans are permitted withdrawals) - with a tunnel bewteen the two vaults they are no longer constrained by the 5 ton or so limit of an armored car (which are rather conspicuous if you start running them in shifts to speed up withdrawals).

Sat, 10/19/2013 - 06:54 | 4071406 Element
Element's picture

This is very dodgy, a gold-vault, under a steel-framed building?

Sat, 10/19/2013 - 08:23 | 4071482 Urban Redneck
Urban Redneck's picture

Not if it is an ACTUAL vault (as opposed to a vault door)- since it would have at least 1/2 million cubic feet of structural steel and over 8 million cubic feet of high strength concrete in the outer walls to be the size of football field and the minimum ASTM F1247/F1090 spec for a real vault. You could fly planes into the building all day long and practice "pulling it", and it would be like watching BHO trying to smack down a young Mike Tyson in a boxing ring. That thing wouldn't be "blobbing up" (or going anywhere else) even in the event of nuke in the neighborhood, if it "is" what they say it "is".

Fri, 10/18/2013 - 14:58 | 4069797 Herd Redirectio...
Herd Redirection Committee's picture

This is obviously in exchange for China to NOT dump Treasuries.

Possession, its 9/10ths of the law.  And yes, of course any gold that may or may not be in the vaults (or belong to someone else) are a part of the deal.

Fri, 10/18/2013 - 16:04 | 4070035 Manthong
Manthong's picture

“Possession, its 9/10ths of the law”

True, but I don’t see them moving that building to Shanghai.

On second thought, they just might figure out a way to do that.

On third thought, they can build a skyscraper in a little over two weeks, so why would they bother?


Fri, 10/18/2013 - 17:43 | 4070339 Urban Redneck
Urban Redneck's picture

The VAST MAJORITY of bank vaults built today are pre-fab, so the materials already exist for the Chinese to do a huge vault VERY quickly - the one caveat being the way the UL codes are written with maximum spans and areas, they would have to go through a custom design review "process" (the right word escapes me) for certification, which is one reason why no one goes for bragging rights (other than the astronomical cost per ft2 which would basically go unused).

Fri, 10/18/2013 - 17:55 | 4070395 ich1baN
ich1baN's picture

Ya, and they had planned to build the world's tallest building in 30 days but had to cancel because they realized the absurdity about doing something on a massive scale with prefab chinese made material. 

I can't wait for the DOLLAR to plummet because that will finally bring an end to our crony corporatists in China manufactuing goods there that last 1/10th as long as the same product made in the USA, let alone we don't have to spill corporate secrets.

The "Average Kingdom" is just that. Chinese are some of the most xenophobic people I have lived with while I was in China. They actually believe they are a superior race of people. The CCP perpetuates this myth ad nasuem and makes fake demon "laowai" dragons in the news all the time.

They have threatened to nuke 100s of US cities on 2 different occassions now and even are willing to go to WWIII over Iran or Taiwan. Mention the word "Japan" in China and you will see their faces boil over.

There are still 2.9 million slaves in China that work in the trafficking and sex trade industry. Are these really the people we want ruling our lives?

Wake up America, return to your roots. Respect our Founding Fathers and the ideal of a Republic. Fight for freedom, justice, and the greater good because there is a sycophant in Beijing that thinks you are a barbarian. They believe they are molders of men. Ah what hubris! 

Fri, 10/18/2013 - 18:34 | 4070519 Freddie
Freddie's picture

Until Americans pull the plug on TV and Hollywood than O and the Dems plus their Chinese overlords are in charge.  Conservatives rationalize saying they watch Fox which just as bad.  Your cable and sat TV fees keep all of them in the money because they all get a cut of that. 

Fri, 10/18/2013 - 15:28 | 4069895 WillyGroper
WillyGroper's picture


guess you can't post chinese caligraphy.

Mon, 01/20/2014 - 13:07 | 4348401 fedupwhiteguy
fedupwhiteguy's picture

this site is limited in other ways also. ah well.

Sat, 10/19/2013 - 05:57 | 4071395 StychoKiller
StychoKiller's picture

Perhaps they really want to check and see if there's a secret tunnel to the NY Fed gold vault...

Sat, 10/19/2013 - 06:42 | 4071412 Tompooz
Tompooz's picture

"Unless there's something going on behind the scenes like the US literally having a killswitch on the Chinese leadership"

Killswitches galore, around the world, to be found in the NSA database...




Fri, 10/18/2013 - 15:02 | 4069811 pulp1
pulp1's picture

That is the GOAL!

3 - 5 years>

Fri, 10/18/2013 - 15:18 | 4069862 dontgoforit
dontgoforit's picture

I believe New Patriot may have nailed it: FOB - Forward Operating Base.  If you were going to head out on a 'bloodless' world domination, gold in all the right places would sure help your efforts. 

Fri, 10/18/2013 - 14:47 | 4069749 qussl3
qussl3's picture

The US has a naval base in Singapore, China has nothing.

What they do have is a Freeport, where physical goods can be vaulted outside national boundaries, ie Singapore customs wont touch stuff moved into the vaults.

Pretty convenient huh?

Fri, 10/18/2013 - 14:16 | 4069650 Grande Tetons
Grande Tetons's picture

No seven year wait time for the not so patient Chinese. 

Fri, 10/18/2013 - 14:52 | 4069778 ziggy59
ziggy59's picture

...but the cupboards were bare....

Fri, 10/18/2013 - 19:37 | 4070699 xtop23
xtop23's picture

Perhaps a means to sell Gold to the Chinese directly in a private manner that keeps them from buying on the open market? No silly Comex reports that will reveal just how depleted their stores are becoming.

Fri, 10/18/2013 - 14:06 | 4069606 Mark Carney
Mark Carney's picture

China will be mad when they find no gold there, lol

Fri, 10/18/2013 - 14:15 | 4069643 diogeneslaertius
diogeneslaertius's picture

"China will be mad when they find no gold there, lol"

the gold has already been moved of course and this is known by the buyer. but i still almost shot coffee out of my nose.

Fri, 10/18/2013 - 15:04 | 4069812 Renewable Life
Renewable Life's picture

So wait......."old JPM HQ" being bought for its largest gold vaults" today, and yesterday JPM Chase banks says NO MORE INTL WIRE TRANSFERS, after Nov. 17th!!!!

Nope, nothing going on here, I'm sure its totally unrelated! Shit always happens for no reason!

Remember Jamie is rich "because he's smarter then you" and he gets the information before other people do, I wonder what he knows????

Fri, 10/18/2013 - 15:20 | 4069871 dontgoforit
dontgoforit's picture

Enter the Dragon - the REAL new world order.

Fri, 10/18/2013 - 14:00 | 4069576 Bluntly Put
Bluntly Put's picture

You mean someone actually bought the manipulation mechanism? I wonder if they did their due diligence to know the extent of the fraud?


Fri, 10/18/2013 - 14:33 | 4069701 blackholes
blackholes's picture

Don't have to worry about delays in delivery when you own the place, I guess.

Fri, 10/18/2013 - 17:59 | 4070406 kita27
kita27's picture

possession is 9/10 of the law!     

Fri, 10/18/2013 - 18:40 | 4070544 Jumbotron
Jumbotron's picture

"Welcome our new owners, call them master."

They're just protecting what's their's.  Can't say that I blame them.

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