GlobeSt.com EXCLUSIVE: RPW Group Closes on $40M Purchase of Altria Group Building

Robert Weisz, president and chief executive officer of RPW, tells GlobeSt.com that the transaction closed on Friday, Sept. 10. He would neither confirm nor deny that the purchase price for the property was $40 million. "It is a very unique opportunity to own a building like this. Properties such as this are not up for sale very often."

CB Richard Ellis' Jeffrey R. Dunne, vice chairman and Steve Bardsley, first vice president, represented the Altria Group. CB Richard Ellis officials also provided no details on the purchase price for the complex.

Weisz says that he plans to convert the former headquarters building into a multi-tenanted property. He plans to spend between $10 million to $12 million in mostly tenant-improvement related work on the conversion.

He reveals that RPW Group has retained CBRE as the exclusive leasing agent for the complex. CBRE first vice president William Cuddy will head the leasing team on the project. Cushman & Wakefield has been retained as the asset manager for the property. Glenn P. Walsh, senior director, will head the assignment for C&W.

Weisz says that his firm, which has previously converted a number of office properties in the region from single to multi-tenanted buildings, is already in discussions with prospective tenants at the Altria complex that are interested in anywhere from 7,000 sf to as much as 150,000 sf of space.

A contract was signed on July 13 by RPW Group to acquire the Altria Group complex, which includes the main building at 800 Westchester Ave, and another smaller building at 760 Westchester Ave. The facility once housed the headquarters of General Foods, as well as operations of Philip Morris International. The property also includes 500,000 sf of enclosed parking--approximately 1,100-car capacity--and a large man-made pond at the entrance to the property.

RPW will receive $2.02 million in sales tax exemptions and an unspecified amount in mortgage tax exemptions in connection with the acquisition and repositioning of the property from the Westchester County Industrial Development Agency.

"The 760 and 800 Westchester Ave. portfolio should perform admirably for RPW Group given its prime location, premier finishes and enormous package of amenities," says CBRE's Dunne. "It should lease very well in Westchester's tightening market where there is a dearth of available large blocks of quality office space."

Dunne adds that RPW Group bested a "substantial list of quality investors" for the property that some in the brokerage trades in years past nicknamed the "Taj Mahal." Some of the other bidders for the property had sought to convert the buildings to residential use or to a hotel/conference center.

In January of this year, the Altria Group announced it was putting the Rye Brook complex on the market for sale and would relocate approximately 1,000 employees from its Kraft and Philip Morris divisions to other locations in Westchester County, Northbrook, Ill., and Miami, Fla. The company will vacate the complex by year's end.

Weisz says tenants who wish to take their space "as is" could begin occupancy in January 2005. Those wishing some improvements to their space could begin moving in by March 2005. With the purchase, the RPW Group has approximately 1.3 million sf of commercial space in Westchester County and 1.5 million sf portfolio-wide.