NEW YORK CITY—In a $734-million transaction that expands its Manhattan portfolio by 1.64 million square feet, Empire State Realty Trust Inc. reports it has completed the acquisition of the ground and operating leases at 112 West 34th St. and the ground lease at 1400 Broadway.

The company acquired the interests in the two properties for $734 million in cash, common stock and operating partnership units. 112 West 34th St. is a 26-story, 650,769-rentable-square-foot office tower, with 92,455 square feet of retail space located in the 34th Street/Penn Station submarket. An 89,529 square foot block of retail space located directly across from Macy's flagship location is currently being marketed for occupancy in mid-2016. The property's office and retail space is 77.5% occupied and 83.2% leased, as of June 30, 2014, the company states.

1400 Broadway is a 37-story 880,131-rentable-square-foot office tower with 19,815 square feet of retail space, located in the Times Square South submarket. The property's office and retail space is a combined 92.6% occupied and 92.7% leased, as of June 30, 2014.

The leaseholds and fee title to a small contiguous property at 112 West 34th St. were acquired for approximately $423.6 million, or approximately $570 per square foot, consisting of $87.7 million by assumption of existing mortgage debt, $106.8 million in cash and $229.1 million in shares of Class A and Class B common stock and Series PR OP units, the company states.

The leasehold at 1400 Broadway was acquired for $310 million, or approximately $346 per square foot, consisting of $80 million by assumption of existing mortgage debt, $79.7 million in cash, and $150.3 million in shares of Class A and Class B common stock and Series PR OP units. In connection with these transactions, the company issued 2.7 million shares of Class A and Class B common stock at a per share price of $16.65 and 20.1 million Series PR OP Units at a unit price of $16.65.

Anthony E. Malkin, chairman, president and CEO of Empire State Realty Trust, says of the firm's purchases, “Our acquisition of these high-quality midtown office properties represents an excellent opportunity to enhance shareholder value. Their redevelopment programs are well underway, and we believe there is excellent upside in the re-leasing of the office and retail space at both properties that we expect to capture over time.”