Columbia Property Trust Buys Two Office Properties in Manhattan for $514M
Twitter’s New York headquarters occupies the majority of the boutique buildings on 17th Street in New York's Chelsea neighborhood.
NEW YORK CITY — Columbia Property Trust Inc. (NYSE: CXP) has purchased two office properties in the Chelsea submarket of New York for $514 million. The acquisition includes two adjoining office buildings that total 281,294 square feet at 245-249 W. 17th St., as well as a 165,670-square-foot office building at 218 W. 18th St. The seller was not disclosed.
Twitter’s New York headquarters occupies the majority of the boutique buildings on 17th Street. The adjoining buildings include a six-story western tower and a 12-story eastern tower that serves as a showroom for the high-end modern furniture chain Room & Board. The nearby 12-story building on 18th Street houses the New York City headquarters of beverage and lifestyle company Red Bull, along with several other office tenants.
This acquisition has allowed Columbia to increase its New York presence to a total of 2.6 million square feet of Class A office space spread throughout seven assets. This represents 44 percent of the trust’s overall portfolio.
“Our acquisition of these prime Midtown South buildings allows us to expand within New York, where we already held the largest concentration in our portfolio, and will further establish Columbia as a significant player in Manhattan’s most dynamic office district,” says Nelson Mills, Columbia’s president and CEO. “We view these acquisitions, along with our recent share repurchases, as an excellent use of the capital raised from our non-core dispositions.”
This transaction will be a strategic purchase for the firm as office demand and leasing activity continue to ramp up in Chelsea, according to Adam Popper, Columbia’s senior vice president.
“Based on the leasing momentum we are experiencing at our nearby assets, particularly with our recent track record at 315 Park Ave. South, we remain very confident in the Midtown South and Chelsea submarkets,” he says. “Financial services users continue to embrace these submarkets as one of the preferred destinations for tenants in New York City, with strong demand for assets like these that offer smaller floor plates, fully renovated interiors and attractive amenities.”
The company’s recent renewal of DLA Piper for 119,000 square feet in Silicon Valley puts its overall lease rate at 95 percent.
New York-based Columbia Property Trust owns and operates Class A office buildings concentrated in high-barrier-to-entry gateway markets. Its portfolio includes 19 operating properties totaling more than 9 million square feet primarily in New York, San Francisco and Washington, D.C. Columbia’s stock price closed at $21.91 per share on Thursday, Oct. 12, up from $21.83 per share one year ago.
— Nellie Day