July – Briefs/Sales & Development

Fallon Sells Vertex HQ for $1.1B; Beacon JV Grabs $100M Chicago Loop Office Tower; Lincoln Sells Office Park in Orange County, Calif.; KDC, State Farm Break Ground on 17-Acre M-U Project in Georgia; ARCP to Grab Red Lobster RE in $1.5B Sale-Leaseback; Savanna, KBS Capital Acquire NYC FiDi Asset for $261M; Coldwell Banker Commercial Brokers $350M San Francisco Sale; Hersha Buys Key West Resort for $100M.

Fallon Sells Vertex HQ for $1.1B

0714_Briefs_Sales_VertexHFF has closed a massive deal with the sale of the Vertex Pharmaceuticals Inc. global headquarters on Boston’s Fan Pier. The 2013-built asset was sold by The Fallon Co. and an institutional investor advised by Cornerstone Real Estate Advisors L.L.C., and was acquired by Senior Housing Property Trust for $1.1 billion. The campus consists of two 16-story towers with office/research space, ground-floor retail and a 740-space parking garage. The office-and-lab component of the property is leased by Vertex through 2029.

Beacon JV Grabs $100M Chicago Loop Office Tower

Beacon Investment Properties L.L.C., in a joint venture with Harel Insurance Investments and Financial Services Ltd. of Tel Aviv, has bought a 23-story office tower in Chicago’s West Loop from Monroe Acquisition L.L.C. for $100 million. Florida-based Beacon and Harel acquired the 535,911-square-foot high-rise as a value-add investment opportunity. The average in-place rental rate in the 91 percent-leased high-rise is below market. The deal was handled by Jeff Bramson and Jaime Fink, senior managing directors, and Mark Katz, managing director, in the Chicago office of HFF. Built in 1973 and renovated in 2006, 200 W. Monroe is located in the center of the West Loop, Chicago’s fastest-growing submarket. The property has a contemporary two-story lobby and a 33,528-square-foot Equinox fitness center and spa.

Lincoln Sells Office Park in Orange County, Calif.

Nearly three years after acquiring One Pacific Plaza through a receivership sale, Lincoln Property Co. and GEM Realty Capital have sold the three-building, Class A office asset in Huntington Beach, Calif., to Prudential Real Estate Investors for $93.6 million. The trophy property has a 12-story main tower and two six-story buildings with 384,303 square feet of rentable space. The partners acquired One Pacific Plaza in October 2011 through a receivership sale and made significant upgrades, including remodeling the lobby and elevators, updating common areas and creating outdoor courtyard areas.

KDC, State Farm Break Ground on 17-Acre M-U Project in Georgia

KDC has begun construction on Park Center, its new 17-acre master-planned project in the Perimeter Center area of Dunwoody, Ga. The full-site plan includes 2.2 million square feet of office space, 100,000 square feet of retail and a 200-room hotel. KDC plans to achieve LEED Silver certification for the project, which will be built in phases over the next decade. State Farm will lease 585,000 square feet in the development’s first office building and will lease additional space as the project unfolds. The first office building at Park Center will consist of a 13-story building situated on a seven-level parking structure with ground-floor retail space. The Class A building is located on a nearly four-acre site at Hammond Drive and Perimeter Center Parkway, adjacent to the Dunwoody MARTA station.

ARCP to Grab Red Lobster RE in $1.5B Sale-Leaseback

As part of Golden Gate Capital’s acquisition of the Red Lobster chain from Darden Restaurants Inc., American Realty Capital Properties Inc. will buy more than 500 Red Lobster restaurant properties and lease them back to GGC. The deal is valued at about $1.5 billion. The purchase price reportedly represents a GAAP cap rate of 9.9 percent and a cash cap rate of 7.9 percent. About 93.5 percent of the portfolio’s leases will be structured with a 25-year initial term and the remainder (constituting leasehold assets) will have a weighted average 18.7-year initial term. The portfolio master leases will also include 2 percent annual contractual rent escalations. Once this transaction closes, ARCP will have achieved its $3 billion 2014 acquisition target well ahead of schedule.

Savanna, KBS Capital Acquire NYC FiDi Asset for $261M

A joint venture between Savanna and KBS Capital Advisors has acquired 110 William St., a 32-story, 928,000-square-foot office tower at the corner of William and John streets in Manhattan’s Financial District. The power duo bought the asset from Swig Equities and the Dubai Investment Group for $261.1 million. Eastdil Secured served as the exclusive advisor for the transaction. Newmark Grubb Knight Frank will lead leasing efforts, while Swig Equities will be retained for property management services.

Coldwell Banker Commercial Brokers $350M San Francisco Sale

Coldwell Banker Commercial NRT has brokered the sale of one of San Francisco’s landmark office towers, 225 Bush St., for $350 million. German firm Seb Immobilien Investment, Flynn Properties and GEM Realty Capital were the sellers, while China-based Kylli Inc. became the majority joint venture partner in the transaction. Flynn Properties will remain an investor in the new joint venture, and will continue to serve as the property manager. JLL identified Kylli Inc. as Flynn Properties’ new joint venture partner, and provided support on the transaction. The deal marks the biggest Bay Area transaction ever recorded for Coldwell Banker Commercial NRT and is the largest San Francisco office sale since 2012. The 583,000-square-foot, 22-story building was constructed in 1922 by John Rockefeller and had served as the headquarters for Standard Oil of California (now Chevron) for more than half a century. Today, tenants include Shield of California, Wells Fargo Bank, Groupon and Zillow.

Hersha Buys Key West Resort for $100M

High yields and a resurgence of the resort sector are driving an interest in the Florida Keys’ lodging market, according to JLL. The service firm recently sold Parrot Key Resort in Key West for $100 million on behalf of Northwood Investors L.L.C. Hersha Hospitality Trust was the buyer. Managing director Gregory Rumpel and vice president Carolina Lacerda led the JLL team on the transaction. Parrot Key Resort sits on five acres of waterfront property. Amenities include a tiki bar, four private swimming pools, a fitness center, waterfront sun-bathing terraces and water sport rentals.