Sean Ryan is associate editor of Real Estate New Jersey
About $10.5 million of the net proceeds and $8 million of the restricted cash were used to pay down existing debt, leaving WWG with no mortgage debt. The remaining $20.2 million in cash, after selling expenses, will be ready for WWG operations and distribution to partners. WWG expects to gain $10.1 million on the transaction.
The Archon Group led the transaction on behalf of the WWG. Regional directors Fred Arena and Sam Morreale, along with director of dispositions John McNamara, led the transaction from Archon's Chatham office. Additionally, Cushman & Wakefield's Financial Services Group represented Archon.
"This asset is an excellent fit for our portfolio," says Mark Yeager, president of Gale. Archon Financial LP and Gramercy Capital Corp. provided the mortgage and mezzanine financing. An unnamed affiliate of the Manhattan-based SL Green Realty Corp., which has an investment with Gale through a multi-state, 35-building, 4.7-million-sf office portfolio, provided participating preferred equity.
McNamara describes Archon's plan with regards to 105 Challenger as "to acquire the asset, redevelop it, secure a full building user, and sell it at a record market price." With the completion of this sale, WWG has sold 13 buildings and one parcel of land since the beginning of 2005. It has just one 129,000-sf office building in Warren and one parcel of land in Hanover Township left in its portfolio, which WWG intends to sell before the end of the year.
105 Challenger Rd. is a nine-story class A office building adjacent to I-95, I-80 and Route 46. Samsung is the majority tenant, with 75% of the building; Chase Mellon has the remainder. Amenities include a cafeteria, loading docks and storage facility. Wellsford/Whitehall Group is a joint venture between Wellsford Real Properties Inc. and the Whitehall Funds. WRP is a New York-based merchant banking firm with a 35.21% stake in WWG. WRP's share of this money is $3.5 million. Whitehall is a private equity fund manager by the Goldman-Sachs Group Inc., which also wholly owns Archon Group.
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