The 300,000-sf Downtown property, the Shelbourne REITs' only Manhattan asset, is owned by 568 Broadway Joint Venture, a partnership in which each of the Shelbourne REITs hold an interest. Roughly one third of the building is leased by Scholastic Publishing. The property is also occupied by a number of art galleries and high-end showrooms, but is perhaps best known as the SoHo home of A/X Armani Exchange and Eddie Bauer.
Insignia/ESG executive managing directors Richard Baxter, Kevin Haggerty and Ron Cohen negotiated on behalf of Shelbourne. The buyer, described by Baxter as "as group of high net worth individuals, not a name that anyone would recognize, not a REIT or a fund," was represented by Insignia managing director Kenneth Zakin.
According to Baxter, competition for the 12-story class B office building was hot. "We were retained in early September and we marketed the property for six weeks," Baxter tells GlobeSt.com. "We had 15 bids to acquire the property and several parties put in pre-emptive bids. One party made a very firm offer to buy and that offer was accepted in an all-night session last night."
Baxter notes that the strong retail presence of Armani and Eddie Bauer lends the building cachet that sparked competition. "This property generated the same amount of interest as a major class A property. It was hotly contested. Everyone was happy."
In addition 568 Broadway, which was built in 1897 and is located at the corner of Broadway and Prince Street, the Shelbourne REITs collectively own 15 properties including shopping centers, office buildings San Diego and the Seattle Central Business District and warehouse facilities in Columbus, OH, among others.
Shareholder approval of the REITs' liquidation plans, expected last month, came through two days ago. The Board of Directors of each of the trusts had already approved the plan.
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