Government Properties Income Trust (NYSE: GOV) has acquired a 17-story, 187,060 sq. ft. office building in New York City that is 100% leased to the United Nations. The acquisition price was approximately $114 million, excluding acquisition costs.
New York-based Extell Development Corp. was the seller of the building at 305 E. 46th St. The translation department of the United Nations utilizes the office space.
Headquartered in Newton, Mass., Government Properties Income Trust owns properties throughout the United States that are majority leased to the U.S. government and several state government tenants. As of March 31, the real estate investment trust (REIT) owned 58 properties with 7.1 million rentable sq. ft.
Ken Hedrick of brokerage firm Stan Johnson Co. represented the buyer, and James Gross of Williamson, Picket, Gross, Inc. represented Extell Development in the transaction.
“A single-tenant office building leased to the United Nations in the heart of Manhattan was a perfect fit for our client,” says Hedrick. “We believe this asset will be a great addition to their portfolio.”
The going-in cap rate is 7.1% based on generally accepted accounting principles. The purchase by Government Properties Income Trust was funded using cash on hand and drawings under the REIT’s revolving credit facility.