ALEXANDRIA, VA-New York State Common Retirement Fund, or NYSCRF, has acquired a core office building here through two funds working on its behalf--Artemis Real Estate Partners and American Real Estate Partners. The 167,000-square foot Carlyle Center is the newest building in the Carlyle Development, which houses the 2.5-million square foot Patent and Trademark Office.

Its purchase price was not disclosed. Eastdil Secured represented the buyer.

The trade occurred through NYSCRF's $300 million real estate Emerging Manager Program, which invests in commercial real estate around the country through its partnership with Artemis.

American Real Estate Partners kicked in about $50 million of equity as part of its participation in the deal, Brian Katz, president and COO of American Real Estate Partners tells GlobeSt.com.

The program's goal is to invest in high-quality, high-grade assets on a relative risk return basis, Katz explains. The Carlyle Center trade fits with that mandate, he says. "It is a trophy asset in a market that we think has long-term fundamental growth opportunities and we were able to buy it at a slight discount to replacement cost on a low leverage basis."

In short, he says, "it will generate a nice cash flow without taking a lot of risk."

As for American Real Estate Partners, the deal also represents a change in investment focus. "This is transformative for our company in the type of capital we are placing in the market," Katz says. "Typically we have looked at opportunistic and value-add deals. "

Instant Insights /

Core Alexandria Office Trades to Pension Fund

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