August – Briefs/Sales & Development

$1.4B GM Building Share Sale Tops NYC Post-Recession List; Hudson Pacific JV Completes 231 KSF Buy in Burbank; Suburban New Orleans Office Trades for $150M; USAA Sells 5 MSF Industrial Portfolio to Duke; Trophy NYC Tower Trades for $1.3B; CBRE Global Investors Buys 437 KSF Dallas Office Space; KBS REIT III Buys Three-Property Office Portfolio; First Potomac Completes $259M Industrial Sale; Ground Breaks on $450M Boston Research Center.

$1.4B GM Building Share Sale Tops NYC Post-Recession List

A 40 percent stake in Manhattan’s General Motors Building has traded hands in what is unofficially being touted as a $1.4 billion transaction. That makes the CBRE Group Inc.-brokered deal the largest New York investment sale since 2008. The buyers were the Sungate Trust, formed for the benefit of the family of Zhang Xin, and M. Safra and Co., the New York-based investment firm of the Safra family.

The two buyers bought the 40 percent stake together, though the specific structure was not disclosed. The sellers were the Goldman Sachs U.S. Real Estate Opportunities I fund and Meraas Capital. The 1968-built asset sits 50 stories tall and occupies the entire block between Fifth and Madison avenues bounded by 58th and 59th streets. Its 2 million square feet of space is occupied by a tenant roster including the likes of the Estee Lauder Cos.; Icahn Enterprises; law firm Weil, Gothal and Manges; and the Apple store on Fifth Avenue.

Hudson Pacific JV Completes 231 KSF Buy in Burbank

A joint venture between Hudson Pacific Properties and M. David Paul & Associates/Worth Real Estate Group has completed its acquisition of the second part of The Pinnacle, a 625,640-square-foot office property located in Burbank, Calif. Pinnacle II, a 231,864-square-foot Class A property, was acquired for $130 million. It is currently 100 percent leased to Warner Bros. Entertainment through December 2021. The partnership had acquired the 393,776-square-foot Pinnacle I building in November 2012 for $212.5 million, $129.9 million of which was financed with a new 10-year loan.

 Suburban New Orleans Office Trades for $150M

Lakeway Center, a 1.2 million-square-foot office property in Metairie, La., has come under new ownership. The Feil Organization now calls the asset its own, having purchased the three-building complex from Equity Office Properties for roughly $150 million. Holliday Fenoglio Fowler L.P. orchestrated the sale of Lakeway Center on behalf of Equity Office Properties, which had owned the property since 1993. Carrying addresses on Causeway Boulevard along Lake Pontchartrain, the Lakeway Center towers sprouted up between 1981 and 1987, and all three underwent renovations in 1996. Today the complex is 90.5 percent leased, with such names as People’s Health Network and the U.S. Drug Enforcement Administration taking up space on the tenant roster.

USAA Sells 5 MSF Industrial Portfolio to Duke

Duke Realty Corp. continues boosting its industrial holdings with its latest acquisition of a nearly 4.9 million-square-foot portfolio comprising eight Class A properties sold by USAA Real Estate Co. for $311 million. The distribution centers are located in high-growth, major supply chain markets in California, Pennsylvania, New Jersey, Texas, Kansas and Missouri. The portfolio is fully leased, with a tenant roster including Home Depot, The Clorox Co., Kimberly Clark, Jo-Ann Stores, Sears and Walgreen Co. CBRE Group Inc. represented USAA Real Estate in the sale. The deal calls for Duke to assume $99 million in secured debt.

Trophy NYC Tower Trades for $1.3B

A joint venture between New York-based retail developer Crown Acquisitions and Highgate Holdings has acquired the trophy 27-story glass-and-steel office and retail tower at 650 Madison Ave. The seller, global alternative asset manager The Carlyle Group, secured a sales figure of $1.3 billion. The Class A building is a 600,472-square-foot complex that encompasses the entire westerly block-front on Madison Avenue between 59th and 60th streets. Prior to the sale, the building underwent a capital improvement program that included a bespoke lobby, marquis canopy, glass curtain wall entrance, new elevators and common areas all designed by Moed de Armas & Shannon Architects. The asset is currently 92 percent leased, and includes the 276,826-square-foot international headquarters of Polo Ralph Lauren Corp. Major retail tenants in its Madison Avenue frontage include Crate & Barrel and luxury designer Tod’s.

CBRE Global Investors Buys 437 KSF Dallas Office Space

CBRE Strategic Partners U.S. Value 6 continues adding to its holdings with the purchase of Signature Place I and II, a 437,364-square-foot, two-building, Class A office property in the Far North Dallas submarket. The fund, sponsored by CBRE Global Investors, bought the eight- and 11-story buildings from DRA Advisors. The price of the 1983- and 1986-built property was not disclosed. The buildings are 77 percent leased, with a roster including EMC; the law firm of Wright, Ginsburg, Brusilow; and insurance companies Summit Alliance and Combined Group.

KBS REIT III Buys Three-Property Office Portfolio

KBS Real Estate Investment Trust III has completed its largest acquisition of the year with the $269 million purchase of a 1 million-square-foot portfolio comprising three office properties in Dallas and suburban Washington, D.C., from seller CBRE Global Investors. With the purchase of Preston Commons and Sterling Plaza, KBS REIT III added a respective 427,800 and 313,600 square feet to its presence in Dallas. And by grabbing the 321,000-square-foot One Washingtonian Center, the REIT made its entrée into the state of Maryland. All told, the portfolio is 87 percent leased. The acquisition was financed with a four-year, $170.8 million mortgage loan through Bank of America N.A.

First Potomac Completes $259M Industrial Sale

First Potomac Realty Trust has completed its previously announced disposition of 23 institutional-quality industrial properties. The portfolio was picked up by an affiliate of Blackstone Real Estate Partners VII for $241.5 million. IndCor Properties, Blackstone’s national industrial portfolio company, will manage the assets. Proceeds from the 4 million-square-foot sale will be used by First Potomac Realty Trust to repay outstanding debt, improve balance sheet flexibility and take advantage of future industrial purchases in the Washington, D.C., region.

Ground Breaks on $450M Boston Research Center

Boston’s status as the leading life sciences hub in the country will only be bolstered now that ground has been broken on Brigham and Women’s Hospital’s $450 million Brigham Building for the Future. The new 360,000-square-foot medical research lab and clinical facility will sprout up on BWH’s campus in the Longwood Medical Area. The 11-story tower will feature advanced imaging facilities, a conference center and a 460-space parking garage. NBBJ is the architectural firm onboard for the development, which is being designed to achieve LEED Gold certification.