The Real Deal New York

Boston Props to sell NJ office park for $468M

April 25, 2011 10:28PM
By David Jones

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Boston Properties said it agreed to sell Carnegie Center, a 2 million square foot office park in Princeton, N.J., to a joint venture between Normandy Real Estate Partners and the Landis Group for $468 million.

In January, Doug Linde, president of Boston Properties, said the company might sell most or all of the 16-building complex, as part of a group of suburban properties that it was thinking about selling.

“I talked to Carnegie Center and we’re recapitalizing to sell a significant portion or a full on the entire Carnegie Center asset base depending on what that pricing looks like,” Linde told analysts in the January call, according to a transcript from SeekingAlpha.com. “We’d like to try and retain management and development because we still control the land for another seven-plus years and that will kind of play out.”

The firm said that the deal is contingent on closing by June 21, 2011, as part of a “like kind exchange,” under section 1031 of the Internal Revenue code, adding that either party may end the agreement at any time, without penalty.

Analysts said the complex was about 87 percent occupied and Colliers International is reporting that average asking rents are $26.31 per square foot in the Princeton area.

Normandy, based in Morristown, N.J., previously acquired a 1.6 million-square-foot property in Westchester in 2009, and announced plans in late February to launch a new brand for the Exchange and a multi million-dollar renovation of the complex.

Normandy and Five Mile Capital previously sold the John Hancock Tower to Boston Properties for $930 million. Under that deal, Normandy will continue to manage the Hancock Tower for two years.

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