Investcorp Makes $156M Manhattan Office Buy

By Corina Stef

256 W. 38th St., New York City

As part of its extended $2 billion investment strategy, Investcorp has partnered with Brickman to acquire two office buildings in Midtown Manhattan. New York REIT sold the assets, which total 267,000 square feet of space, for a combined $156 million. Brickman will handle the property management and leasing services for both properties.

The first asset is located at 229 W. 36^th St., and encompasses more than 117,000 square feet of space throughout 12 floors. According to Yardi Matrix, it was built in 1921 and underwent renovations in 2008. The second building is situated at 256 W. 38^th St., and spans 118,200 square feet across 14 floors. It was completed in 1924 and previously served as an industrial building. Following an adaptive reuse in 1980, it was converted to office and once again renovated in 2012. The property features upgraded lobbies and elevators, as well as improved HVAC systems and façade.

Stabilized assets

The buildings are located in the borough’s Garment District, minutes away from each other. Neighborhood amenities include hotels, retailers, art galleries, eateries and cafes, in addition to multiple transportation options. Additionally, both assets are fully leased to more than 20 long-term tenants, including Mobile Health, the American Language Communication Center and Neoscape Inc.

“These centrally located properties are well-positioned to benefit over the long term from the development activity around Hudson Yards, Manhattan West, Penn Station and Moynihan Station, while providing stable, in-place cash flows to our investors,” Investcorp Managing Director Brian Kelley said in a prepared statement.

Public records show that New York REIT purchased both assets in January 2013—229 W. 36^th St. traded for $64.9 million, while 256 W. 38^th St. traded for $48.6 million.

Image courtesy of Yardi Matrix