Newmark Knight Frank Brokers $845 Million Boston Office Sale

Newmark Knight Frank, New York, completed the $845 million sale of 53 State Street in downtown Boston.

A joint venture between Allianz Real Estate of America, New York, Beacon Capital Partners, Boston, and the Massachusetts Pension Reserves Investment Management Board, Boston, purchased the asset.

Allianz has deployed $728 million in new real estate equity transactions this year, including the Ferry Building in San Francisco and the Terminal Stores in New York in addition to 53 State Street.

A fund managed by UBS Asset Management, Zurich, Switzerland, acquired the 1.2-million-square-foot Class A office tower in 2011. Also known as Exchange Place, 53 State Street combines the 11-story Boston Stock Exchange building that dates to 1891 with a modern 40-story reflective blue-glass office tower joined by a seven-story atrium lobby. The asset is presently 93 percent leased to tenants including Hill Holliday, Nixon Peabody LLP, Acquia, The Boston Globe and Marcum LLP.

NKF Vice Chairman Edward Maher, Executive Managing Director Matthew Pullen, Managing Director James Tribble and Co-Head of U.S. Capital Markets Robert Griffin oversaw the transaction. A team led by NKF Executive Managing Director David Douvadjian secured financing for the transaction.

The Boston Globe reported the purchase represented the Massachusetts Pension Reserves Investment Management Board’s second large real estate investment in Boston. The board manages the $70 billion Massachusetts State Pension Fund.

The asset comprises an entire city block where State and Congress Streets meet near Faneuil Hall Marketplace and the Park at Post Office Square. Transportation options include on-site access to the MBTA Blue and Orange Lines, walkability to the MBTA Red and Green Lines, South Station and North Station and access to Interstates 90 and 93.

Newmark Knight Frank also advised New York State’s Empire State Development authority on its recent successful bid for Amazon’s East Coast HQ2 operations, the largest state development project in New York’s history.

NKF helped the Empire State Development authority understand Amazon’s selection criteria and how to position itself for the deal. NKF’s Location Strategy and Site Selection practice provided information on large headquarters’ case study site selection, labor analytics, competitive assessment and benchmarking, financial modeling and experiential advice on aspects of the combined Empire State Development and City of New York proposal bid.

Robert Hess, Vice Chairman of Global Corporate Services, led the NKF team. Managing Director Tim Walden handled day-to-day client service. Senior Managing Director Rajeev Thakur, Managing Director Chris Volney and Senior Financial Analyst Rob Peck also assisted the effort.