NEW YORK CITY–Gramercy Capital Corp. and partner Garrison Investment Group closed on the purchase of a 5.6-million-square-foot portfolio. The price was $485 million on the asset, which is leased primarily to Bank of America. The seller is an affiliate of KBS Real Estate Investment Trust Inc.

The deal, announced in August, was funded on a 50/50-basis by the two New York City-based partners with a combined equity investment of $141 million. Gramercy reports it funded its equity contribution with $56 million in cash and the issuance of 6 million shares of common stock valued at $15 million to KBS.

Commenting on the deal, Gramercy Capital CEO Gordon F. DuGan states, “The transaction allows Gramercy to deploy a significant amount of capital into an attractive, high-yielding, net-lease opportunity. Furthermore, Garrison has been a tremendous partner in closing the largest and most complicated deal in my 24-year career.”

Bank of America leases approximately 81% of the 115-property portfolio, which has a total occupancy rate of 88%. The core portfolio, which the Gramercy-Garrison JV plans to retain, consists of 67 properties in 10 states, while the held-for-sale component had 48 assets located in 13 states.

The new ownership reports that, concurrent with the purchase, the joint venture netted $141 million in the sale of two multi-tenanted office buildings—a 1-million-square-foot office building in downtown Chicago and a 406,000-sf building in Charlotte, NC.

The core portfolio is 98% occupied, with 96% leased to Bank of America under a 10.5-year master lease located in what the company terms are primary and strong secondary markets. The joint venture financed the core portfolio with a $200-million first mortgage. Gramercy-Garrison expects the core portfolio to generate approximately $27.2 million in operating income next year.

The joint venture plans to sell the remaining 46 held-for-sale assets in next 12 to 18 months and anticipates net proceeds from the sales of approximately $50 million. The JV anticipates generating net operating income from the held-for-sale properties of approximately $3.2 million in 2013.