NEW YORK — Columbia Property Trust (NYSE: CXP) has acquired three Class A office buildings located in major East Coast markets for a total of $588 million. The transaction includes a 341,330-square-foot office building in Manhattan’s Gramercy Park submarket, a 244,565-square-foot building in the Washington, D.C., submarket of Reston, and a 274,218-square-foot building in Boston’s Back Bay district.
The Manhattan property is a historic office building located at 315 Park Ave. South. It was purchased as part of an office portfolio that included the D.C. building, located at 1881 Campus Commons Drive. They were acquired from Spear Street Capital in an off-market transaction for a total of approximately $436 million.
The Boston property is located at 116 Huntington Ave. It was purchased from Broadway Partners for $152 million.
The Manhattan property is 95 percent occupied, while the other two stand at 78 percent occupancy.
“With these two significant transactions, we continue to execute our strategy of improving the overall quality of Columbia’s portfolio through investment in value- creation opportunities in our target markets,” says Nelson Mills, Columbia’s president and CEO. “These acquisitions provide us with a greater presence in Manhattan, as well as a significant foothold in Boston’s urban core — two of the nation’s most desirable markets. Each property offers favorable upside potential, with in-place rents below market and significant lease rollover in the next two to five years. We are confident that we can once again achieve our targeted returns on these projects with our demonstrated leasing capabilities.”
The acquisitions were financed with a $300 million bridge loan; a $140 million draw under Columbia’s unsecured credit facility; and $148 million of cash on hand, primarily generated by the firm’s 2014 disposition activity.
Columbia Property Trust is a publicly traded REIT based in Atlanta. It invests in high-quality commercial office properties in primary markets nationwide. Columbia Property Trust’s stock price closed at $25.16 per share on Thursday, Jan. 8, up from $23.07 per share a year ago.