SEC FORM 4

SEC Form 4

FORM 4

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934
or Section 30(h) of the Investment Company Act of 1940

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Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

1. Name and Address of Reporting Person^*

SCHEETZ W EDWARD

(Last)

(First)

(Middle)

C/O NORTHSTAR REALTY FINANCE CORP.

527 MADISON AVENUE, 16TH FLOOR

(Street)

NEW YORK

US 10022

(City)

(State)

(Zip)

2. Issuer Name and Ticker or Trading Symbol
NORTHSTAR REALTY [ NRF ]

5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)

X	Director	10% Owner
	Officer (give title below)	Other (specify below)

3. Date of Earliest Transaction (Month/Day/Year)
11/16/2006

4. If Amendment, Date of Original Filed (Month/Day/Year)

6. Individual or Joint/Group Filing (Check Applicable Line)

X	Form filed by One Reporting Person
	Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)		4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	Code	V	Amount	(A) or (D)	Price		6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
Common Stock	11/16/2006		C		3,608,515	A	$0	3,608,515	I	By NorthStar Capital Investment Corp.⁽¹⁾
Common Stock	11/16/2006		S		3,608,615	D	$14.95	0	I	By NorthStar Capital Investment Corp.⁽¹⁾
Common Stock								134,471⁽²⁾	D
Common Stock								29,472⁽³⁾	I	By minor children of reporting person

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)		5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	Code	V	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares	8. Price of Derivative Security (Instr. 5)		10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
OP Units⁽⁴⁾⁽⁵⁾	⁽⁴⁾	11/16/2006		C		3,608,515		⁽⁴⁾	⁽⁴⁾	Common Stock	3,608,515	⁽⁴⁾	3,608,515	I	By NorthStar Capital Investment Corp.⁽⁴⁾⁽⁵⁾

Explanation of Responses:

1. NorthStar Capital Investment Corp. ("NCIC") indirectly beneficially owned 3,608,615 shares of common stock, par value $0.01 per share ("Common Stock"), of NorthStar Realty Finance Corp. (the "Company"). By virtue of his position as co-chief executive officer of NCIC, Mr. Scheetz may be deemed to have had voting and/or investment power over such 3,608,615 shares of Common Stock. Mr. Scheetz disclaimed beneficial ownership of such 3,608,615 shares of Common Stock, except to the extent that he may be deemed to have had a pecuntary interest therein, and this report should not be deemed an admission that Mr. Scheetz is or was the beneficial owner of such 3,608,615 shares of Common Stock for purposes of Section 16 or for any other purposes.

2. Includes 11,111 restricted shares of Common Stock previously granted pursuant to the Company's 2004 Omnibus Stock Incentive Plan.

3. Such shares of Common Stock are held directly by one of two trusts for the benefit of one of the two minor children of Mr. Scheetz.

4. Represents common units of partnership interest ("OP Units") in NorthStar Realty Finance Limited Partnership ("NRFLP"), the operating partnership and a majority-owned subsidiary of the Company. The Company is the sole general partner of NRFLP (the "GP"). Each of these OP Units is redeemable at the election of the holder for: (1) cash equal to the then fair market value of one (1) share of Common Stock, or (2) at the option of the Company in its capacity as GP, one (1) share of Common Stock. The right of a holder to redeem these OP units does not have an expiration date.

5. NCIC indirectly beneficially owned 3,608,515 OP Units. On November 16, 2006, NCIC tendered for redemption (the "Redemption") all 3,608,515 OP Units and the Company, in its capacity as the GP, elected to issue NCIC 3,608,515 shares of Common Stock upon the Redemption. By virtue of his position as co-chief executive officer of NCIC, Mr. Scheetz may be deemed to have had voting and/or investment power over such 3,608,515 OP Units. Mr. Scheetz disclaimed beneficial ownership of such 3,608,515 OP Units, except to the extent that he may be deemed to have had a pecuntary interest therein, and this report should not be deemed an admission that Mr. Scheetz is or was the beneficial owner of such 3,608,515 OP Units for purposes of Section 16 or for any other purposes.

	Albert Tylis, as Attorney-in-Fact for W. Edward Scheetz	11/22/2006
	** Signature of Reporting Person	Date
Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* If the form is filed by more than one reporting person, see Instruction 4 (b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
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