As investors continue to show a strong interest in New Jersey’s office market, Northeast Capital Group has closed on the acquisition of The Offices at Bedminster in Bedminster, N.J., for $32.8 million. JLL Capital Markets marketed the property on behalf of the seller, New York Life Real Estate Investors and its client, while also procuring the buyer.
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Located at 500 and 550 Hills Drive, the two-building property includes 190,000 square feet of Class A office space. The 16-acre site also offers covered executive parking, a cafe, fountain pond and outdoor courtyard with a picnic area. Anchored by the New Jersey-based Peapack Gladstone Bank and North Carolina-based Aerie Pharmaceuticals, The Offices at Bedminster is 86 percent leased with a weighted average lease term of roughly seven years.
As the office buildings were originally developed in 1988 and 1989, the properties underwent a multimillion-dollar renovation that included upgrades to the common areas, a new fitness center and a lobby that features a three-story atrium. Both buildings earned efficiency certifications: 500 is ENERGY STAR certified, while 550 is LEED certified and also has WiredScore Platinum certification.
JLL’s Jose Cruz, Kevin O’Hearn, Michael Oliver, Steve Simonelli and J.B. Bruno from the Capital Markets team represented New York Life in the transaction. Previously in 2019, Northeast acquired another office complex in New Jersey for $19.3 million. The New York-based investment group purchased a 178,000-square-foot office in East Hanover from Boxer Property, which was also represented by Cruz, O’Hearn, Oliver and Simonelli, while they were working at HFF.
Active interest in Jersey offices
Cruz said in prepared remarks that despite the current COVID-19 situation, there are still buyers interested in long-term investments in office assets in the northern and central New Jersey markets.
“We are still seeing significant interest from the private buyer pool in New Jersey and are hopeful that the institutions will get more active in the suburban office market over the short term given yields compared to other product types,” Cruz told Commercial Property Executive. “Groups are relatively bullish that at current pricing levels the upside is achievable with expansion of current tenants in the market and the potential for NYC tenants to expand in the state post pandemic.”