MetLife, Norges Buy Big in Boston

August 26, 2021

Office In Focus Investment News More Northeast

The $825 million sale price is the highest paid for a single office asset this year.

In an $825.1 million deal that marks the largest single-asset office sale so far this year, MetLife Investment Management and Norges Bank Investment Management have teamed up to buy One Memorial Drive in Cambridge, Mass., the investors announced on Thursday. The per-square-foot price of $2,000 represents a record for an office asset in Greater Boston.

One Memorial Drive Cambridge, Mass. Image courtesy of Oxford Properties

Located on the Charles River, the 409,422-square-foot property rises 17 stories next near the Massachusetts Institute of Technology. It is fully leased to Microsoft Corp. and to InterSystems Corp. The 35-year-old property was renovated in 2018.

Eastdil Secured represented the sellers, Oxford Properties Group and institutional investors advised by J.P. Morgan Global Alternatives. Oxford and J.P. Morgan had acquired the property in 2014 as part of a portfolio sale.

Four years ago, Oxford repurposed a floor of underutilized parking space into office space, increasing the property’s rentable footprint by 10 percent. InterSystems leased the additional space.

Office deals on this scale have been relatively uncommon of late, but the sale price for One Memorial Drive eclipses even such major deals as Harbor Group International’s recent $760 million acquisition of the CBS Building in Midtown Manhattan.

Both buyer and seller have been active in the investment market this summer. MetLife acquired MetLife Real Estate Investment has purchased The Offices Two at Frisco Station, part of a $1.8 billion mixed-use campus in Frisco, Texas. For Oxford, the sale of One Memorial Drive marks the second major transaction in less than a week. On Aug. 17, the company announced that it had agreed to pay $2.2 billion for an industrial portfolio owned by KKR.

Oxford will use proceeds from the sale to fuel investment in the Boston area and elsewhere, said Chad Remis, executive vice president for North America, in a statement. Remis cited the investor’s interest in life science, multifamily and logistics properties. As part of its $1.2 billion investment in life science properties this year, Oxford has acquired three fully leased assets in the Boston area.