The deal is the first acquisition in the New York Tri-State area for the company, which focuses exclusively on buying and developing properties in inner cities. Since February 2000, it has purchased 19 buildings with 2.4 million sf of space that are valued at $178 million.
"As a New York-based company, we're thrilled to be 'coming home' with this acquisition," says Richmond S. McCoy, president and chief executive officer of the company. "Last year, UrbanAmerica found so many can't-miss investment opportunities in other cities, from Washington, DC to Miami to Las Vegas, that we put our program for the New York region on hold. Now, we're committed to conquering New York's barriers to entry and to making our investment philosophy work here--with this deal and many more in the future."
Reiff adds that the company is reviewing properties in New Rochelle, Mount Vernon and Yonkers as well as in Brooklyn, the Bronx and Queens. The company has not ruled out Manhattan and is interested in owning office space in Harlem sometime in the future. However, the economic renaissance taking place there has caused office prices to rise, which is making it difficult to strike a deal, he says.
UrbanAmerica is in serious discussions with prospective sellers for more than $100 million of commercial real estate nationwide, company officials say. Founded in September 1998, the company has raised $60 million and recently received another $30 million commitment from the Los Angeles County Employee Retirement Association (LACERA). UrbanAmerica hopes to raise $119 million in equity in order to leverage the acquisition of a $450-million portfolio of office and retail properties located primarily in urban markets in the Northeast and Southeast.
Utendahl Capital Partners, LP, a major minority-owned bank and broker/dealer, is the company's sponsor. In addition to LACERA, some of the other investors in UrbanAmerica include Deutsche Bank, JP Morgan Chase & Co., PNC Bank Corp., Prudential Insurance of America, Equitable Life Assurance Society, Citibank, First Union, Washington Mutual Bank, the Dime Savings Bank of New York, Summit Bank, General Mills Pension Fund, Constellation Energy Pension Fund and the Heron Foundation.
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John Jordan
John Jordan is a veteran journalist with 36 years of print and digital media experience.
