Equity, Blackstone Sell New England Executive Park for $216M
- Jun 19, 2013
The New England Executive Park, a 10-building office park in suburban Boston with more than 1 million square feet and approved for another 750,000 square feet of new development, was acquired for $216 million by Charles River Realty Investors and National Development.
The 56-acre office park located off Route 128 in Burlington, Mass., is the latest office property to be sold by Equity Office and Blackstone. Built in the 1970s and acquired by Equity Office more than 10 years ago, NEEP is 86 percent leased to a mix of technology, legal, finance and professional services firms. It is 12 miles from downtown Boston in one of the region’s top submarkets and includes 1, 3, 6, 7, 8, 12, 15, 16, 17 and 24 New England Executive Park.
“Charles River Realty Investors and National Development expressed significant interest in the portfolio due to the property’s redevelopment potential, unmatched location and quality of the buildings and tenancy. This sale is certainly mutually beneficial on both ends,” Mark Smith, market managing director, Equity Office, said in a news release.
Cushman & Wakefield’s Capital Markets team of Robert Griffin Jr., Edward Maher, Jr., Matthew Pullen and leasing specialist Mark Roth represented the buyer and seller.
“New England Executive Park is one of the best ‘super parks’ in New England,” Griffin said in the release. “This was a great opportunity for Charles River Realty Investments and National Development to purchase an asset with strong, diverse tenancy in a thriving and transforming area.”
The local government has already approved development of an additional 750,000 gross square feet that is expected to include more mixed-use offerings. The campus, which has parking for more than 3,350 vehicles, has two full-service restaurants, a fitness center, bank and credit union, dry cleaner and tailor and a conference center. It is currently permitted for office, commercial, retail, hotel and structured parking.
New England Executive Park is in the busy 128 Central submarket that has the highest average rent per square foot of any of the suburban Boston submarkets – $25.67 per square foot in the first quarter of 2013, according to a market report by Cassidy Turley. Of the total office inventory of 35,123,236 square feet in the submarket, just less than 7 million was available during the first quarter. The vacancy rate was 12.6 percent, the report said. In its MarketWATCH report, Cassidy Turley described growth in the 128 Central submarket as “steady and organic” with leasing occurring mainly by smaller tenants taking less than 20,000 square feet.
The Boston Business Journal reported that the joint venture beat out bidders that included Clarion Partners, Davis Cos., Rockpoint Group and Walton Street Capital.
Charles River Realty Investors and National Development, founded in 2006 to make value-added investments for institutional clients, are located in Newtown, Mass., and have been active in several area development projects. They are partners, along with Alexandria Real Estate Equities, Inc., and Clarion Partners, in the $300 million Longwood Center, a 414,000-square-foot medical research center in Boston. National Development is also ready to begin the redevelopment of the former Boston Herald headquarters in the city’s South End into a mixed-use project that is expected to cost at least $200 million.
Blackstone, which acquired Equity Office in November, 2007, for $39 billion, has been shedding many of the office properties in the Boston region and elsewhere in the United States. The three-tower, 1.2 million-square-foot Lakeway Center in Metairie, La., was sold this month by Equity Office to The Feil Organization for an undisclosed amount. In early April, Hines Global REIT, Inc., acquired Riverside Center, a 510,000-square-foot, three-building office complex in Newtown, Mass., from Equity Office for $197.3 million.