"We believe this acquisition reinforces our commitment to selectively acquire well-positioned, net-leased properties, with an increased focus on enhancing our position in major metropolitan areas," Lexington CIO Richard Rouse says in a release. 147 Milk St. is the first asset purchased in the Hub by the REIT. A New York City firm, Lexington does own five other properties in Massachusetts, its portfolio here now totaling more than 750,000 sf.

Jones Lang LaSalle secured the buyer and negotiated 147 Milk St.'s sale on behalf of JER Partners, the private equity investment arm of JE Robert Cos. The transaction, which equates to $382 per sf, was orchestrated by JLL managing directors Michael Smith and Catherine Daume, and national directors Scott Jamieson and Gail McDonough. Daume says there was solid interest for the building, which is 100% leased to Harvard Vanguard Medical. "With one of the largest private practices in the state, Harvard Vanguard is a leading healthcare provider with a long-term commitment to the building," Daume says. "These kinds of assets are not easy to come by in strong urban cores like Boston."

JER Partners official Cia Buckley praised the sales process, and maintains that LRT has bought into an "irreplaceable" location and a building "positioned to thrive with the continued recovery of the Boston market." The Financial District had an office vacancy rate of 8.7% at the end of the first quarter, according to JLL statistics, with the average asking rental rate there at $45.62 per sf. Despite those solid numbers, there was 155,000 sf of negative absorption in the 33.6-million-sf market during the first three months of 2007, the report adds.