Piedmont Sells N.J. Office Building
- Dec 10, 2010
December 10, 2010
By Barbra Murray, Contributing Editor
Piedmont Office Realty Trust Inc. has sold a 410,000 square-foot office asset in Englewood Cliffs, N.J., to LG Electronics USA Inc. in a transaction valued at approximately $55 million. The property, located 10 miles outside Manhattan at 111 Sylvan Ave., is 100 percent leased–for now. Citigroup Inc., the sole occupant, signed a new lease with LG to remain in its digs, but only through spring 2011.
Piedmont had owned 111 Sylvan Avenue, which sits just off Palisades Interstate Parkway and near Interstate 95 in Bergen County, since acquiring it in 2003 under the company’s previous incarnation, Wells Real Estate Investment Trust Inc., for approximately $70.5 million. Proceeds from the sale to 111 Sylvan to LG–in conjunction with cash flow generated by Piedmont’s properties, distributions from joint ventures and proceeds from the company’s $500 million unsecured credit facility–will be utilized as a source of immediate and/or long-term liquidity, as Piedmont notes in its third quarter earnings report.
As for LG, the company is not panicked about Citigroup bidding adieu to 111 Sylvan in just a few months. Spanning 27 acres, the property offers ample room for development and can easily accommodate a larger home for the growing electronics firm, which presently maintains its headquarters two miles north at 1000 Sylvan Avenue. The company also has space at two other buildings for a total three-location occupancy of 187,000 square feet.
LG has not solidified any development plans for the 111 Sylvan site, but the company is seeking the green light from the appropriate local and state entities, and expects to pursue a state incentives package as well. Construction could get underway within two years, but LG isn’t making any promises. Company president Wayne Park noted that whether the firm builds in Englewood Cliffs or elsewhere, the long-term goal is to create workplace efficiencies.