Reckson did not reveal the buyer in its prepared release; however, Heritage Realty Services' president and CEO George Constantin confirms the pending deal to GlobeSt.com. During a company conference call, Scott Rechler, Reckson's president and chief executive officer, confirmed that the buyer also owned the adjoining properties. He called it a "natural strategic" move for them to own this building.

"Heritage Realty Services LLC, on behalf of its investors, is under contract to acquire 3 Gannett Dr.," Constantin says. "We hope we will close by the end of the first quarter. This conforms with our strategy and in our strong belief in the White Plains office market." The law firm Wilson, Elser, Moskowitz, Edelman & Dickler, LLP occupies a majority of 3 Gannett Dr. under a long-term lease, he adds.

Last year, Heritage entered the Westchester office market with its purchase of the adjacent 2 and 4 Gannett Dr. from the Treeline Cos. That acquisition, valued at $200 per sf, set the record for the highest price per sf paid for an office building in Westchester at the time, only to be broken by Reckson's 711 Westchester Ave. purchase a few months later.

Constantin says the deal for 3 Gannett Dr. is prompted by his firm's desire to create an office park with the three buildings (formerly known prior to their sales as Gannett Office Park). One Gannett Dr. is owned and occupied by the Journal News. One real estate source notes however that Heritage had another key motivation since most of the mechanicals for its 2 and 4 Gannett Dr buildings are located in the 3 Gannett property. Constantin alludes to that issue when he says that with the deal his firm will "have complete control of delivering the level of quality services to our tenants."

Heritage Realty was at one time during the bidding process considered the front-runner for the purchase of the 1.6-million-sf EastRidge office portfolio. Reckson eventually won the bid and acquired the 14-building portfolio for $255 million or $163 per sf. In its fourth quarter and full-year 2005 filing, Reckson says that based on the sale of 3 Gannett Dr., its purchase of the EastRidge portfolio is valued at $220 million or $156 per sf.

Instant Insights /

Heritage Contracts to Buy 3 Gannett Dr. for Record Price

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