A joint venture between majority owner Pearlmark Real Estate Partners and minority partner The Blackstone Group has sold a Class A office tower in Philadelphia to the former owner of Chicago’s Sears Tower for $143.5 million.
According to an announcement from Jones Lang LaSalle, which brokered the deal, the Pearlmark-led joint venture sold the 841,172-square-foot trophy office building to an entity formed by real estate mogul David Werner. Data provider Real Capital Analytics lists the building as 85 percent leased.
Werner acquired the building, located at 1700 Market Street, with more than $123 million in financing provided by UBS. The bank granted Werner a senior mortgage of $110 million and a $13.2 million mezzanine loan for the purchase.
The 32-storey building originally was acquired in early 2006 on behalf of Pearlmark's Aslan Realty Partners II fund, according to Stephen Quazzo, chief executive officer of Pearlmark. The Chicago-based real estate principal investment firm owned an 89 percent stake in the building, while Blackstone owned an 11 percent interest.
“[The property] is in a fund that we established in 2002,” said Quazzo. “Our fund life is usually in the 10-year range, so this is coming up on the end of the fund life. This is the natural course of what we do: we acquire assets then try to sell them when their cash flow is stable. That's certainly the case with 1700 Market.”
Pearlmark Real Estate Partners previously was known as Transwestern Investment before officially spinning off from Houston-based Transwestern in June. The firm currently is looking to raise $300 million in equity for its second multifamily fund, Pearlmark Multifamily Partners II.