A joint venture between Madison Marquette and Perella Weinberg Partners has acquired a 450,000-square-foot mixed-use property in Long Island City. The purchase is the first by a newly-formed venture between the two firms that plans to invest in US commercial real estate.
The venture between the Washington DC-based real estate investment and operating company and the New York-based global advisor and asset manager purchased The Center Building, a multi-tenant office property located at 33-00 Northern Boulevard, from Hampshire Properties. Although the financial terms of the transaction were not disclosed, data provider Real Capital Analytics lists the purchase price at $84.5 million.
The mixed-use property is 88 percent occupied, with 71 percent of the rentable space occupied by New York City government agencies. The largest tenant is the Metropolitan Transportation Authority, which occupies 133,000 square feet, according to The Real Deal.
The open-ended joint venture, which does not have a set investment target and will be opportunistic in its purchases, expects to invest in strong cash-flowing investments in a handful of selected key markets across the US. Affiliates of Madison Marquette will manage all properties acquired by the joint venture.
Perella Weinberg invested in this venture on behalf of its asset-based value strategy. Since its inception in 2008, the firm’s asset-based value strategy has grown to encompass in excess of $2 billion in equity capital through a number of different investment vehicles.
David Schiff, a partner at Perella Weinberg and portfolio manager for the firm’s asset-based value strategy, said in a statement: “This investment is consistent with our focus on acquiring properties with quality tenants and strong cash flow in high density urban areas.”
The joint venture and the acquisition of The Center Building are part of a strategic effort announced by Madison Marquette at the beginning of 2012 to broaden its investment platform by establishing a New York City investment team and portfolio holdings. Madison Marquette initiated its New York City efforts at that time, when Arvind Bajaj and Ryan Colbert joined the firm.