By Mihaela Coste
Boston—LaSalle Investment Management recently closed on the acquisition of an interest in 10 Post Office, a 14-story office building located in the center of Boston’s central business district, recapitalizing a joint venture with Synergy Investments, who will continue to act as operating partner. The asset was acquired on behalf of the company’s closed-end, U.S. value-add fund, LaSalle Income & Growth Fund VII. Newmark Grubb Knight Frank worked on behalf of both parties.
According to Suffolk County records, the transaction of the Class A property amounts to $184.8 million, recorded in mid-March. Yardi Matrix data shows that the asset last changed hands in October 2014, when Synergy Investments acquired the property from Broadway Partners for $136.5 million, or approximately $302 per square foot.
Located on 0.35 acres at the corner of Milk and Pearl streets with frontage along Park at Post Office Square, 10 Post Office encompasses more than 450,000 square feet in two interconnected towers. The historic property, completed in 1920, has been substantially renovated and offers tenants great views, flexible floor plates, standard and high ceilings. The property is situated within walking distance of three metro stations.
The asset is home to 36 diverse tenants, with an average remaining term of six years. The new owner plans capital investments through Fund VII’s objectives, including upgraded building systems, new tenant amenities, renovated common areas and the addition of an upscale, ground-level restaurant that will further elevate the property’s image.
“Ten PO represented a unique opportunity to recapitalize a landmark asset with a prestigious Boston address. The property’s below-market rental rates provide a compelling canvas to drive further value creation with Synergy, who has demonstrated a strong track record of success in this space,” said David Schreiber, managing director of acquisitions at LaSalle, in a prepared statement.
“We are excited to continue the extensive capital improvement program for this well-known property. LaSalle has consistently grown its ownership in the Boston CBD, and will bring its market knowledge and renovation experience to our partnership with Synergy to maximize returns for the fund’s investors,” added President of LaSalle’s Income & Growth fund series Jim Hutchinson.
Images courtesy of LaSalle