Vornado Spends $40M on Retail Site

NEW YORK CITY-Vornado Realty Trust picks up a 62,000-sf free-standing retail site located just off of Union Square at 25 West 14th St. here for $40 million. The building, which originally constructed in 1929 and recently renovated, is currently 87% occupied. According to the REIT, the purchase will be funded as part of a Section 1031 tax-free “like-kind” exchange with a portion of the proceeds from the sale of its Palisades Residential Complex which is expected to be completed by the third quarter.

Last month, the Paramus, NJ-based REIT picked up the 165,000-sf Forest Plaza Shopping Center on Staten Island for approximately $32.5 million in a similar 1031-like exchange. The firm also completed a $300 million refinancing of its 1.5 million sf Two Penn Plaza. That loan bears interest at 4.97% and matures in February 2011. Vornado realized net proceeds of $147 million after repaying the existing $151 million loan on the property and closing costs.