(For more retail coverage, click GlobeSt.com/RETAIL.)
NEW YORK CITY-Equity Office Properties is under agreement to take title to the office portion of 1540 Broadway in Times Square, sources tell GlobeSt.com. And Vornado Realty Trust has entered into an agreement to take the retail, signage and parking components for a purchase price of $260 million. The deal has an aggregate value of approximately $820 million.
Eastdil Secured acted as the exclusive advisor the seller, Paramount Group. An EOP spokesperson tells GlobeSt.com that the firm is not commenting as of yet. Built in 1990, the site has an office roster that includes BMG Entertainment Worldwide and Gruner + Jahr Int'l Marketing and Media Services. Last year, media giant Viacom Inc. inked a deal for 305,000 sf, comprising 10 full floors.
Paramount realized a $400-million profit from its mid-2004 acquisition of the asset. "Though we tend to be long-term investors, we saw an opportunity to leverage the demand for Times Square office properties and offered 1540 for purchase," says Paramount Group president and CEO Albert Behler. "The sale happened very quickly." Paramount intends to reinvest its profits in the Paramount Group Real Estate Fund by acquiring additional class A, CBD-located office properties throughout the US.
Also known as the Bertlesmann building for a previous owner, the site it located between 45th and 46th streets. Vornado will take the 152,000-sf retail space, which is currently 60% occupied by tenants including Virgin Records and Planet Hollywood. Vornado officials say the deal should close in the third quarter. The REIT previously spent $158 million for a residential/retail development at East 66th Street and $113-million on the 17,000-sf retail condominium portion of the former Westbury Hotel. Vornado also acquired a 35,752-sf site at 692 Broadway for a price between $700 and $800 per sf.
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