American Realty Capital Pays $112M for NY Office Building

NEW YORK CITY-American Realty Capital New York Recover REIT has acquired the fee simple interest in 218 W. 18th St. in the Chelsea section of Manhattan for $112 million.

The 167,000-sf office building was acquired from a joint venture of Atlas Capital Group Inc. and GreenOak Real Estate. Last year, Atlas and GreenOak purchased the defaulted loan and subsequently took ownership of the property through a prepackaged bankruptcy restructuring. Since that time, Atlas and GreenOak have entered into lease agreements with Red Bull North America, Inc., SAE Institute of Technology Corp. and Yammer, Inc. (a subsidiary of Microsoft Corp.) for seven floors of the building. Company 3, LLC and SY Partners round out the tenant roster at the property, which is now 84% leased. Atlas and Green Oak paid $62.5 million for the property last February, according to the New York Post.

“This acquisition will 'kick-start' 2013 for our fund by adding another institutional-quality office building to our portfolio," says Michael A. Happel, chief investment officer of ARC. “This significant acquisition comes on the heels of the $124.4 million of purchases that we completed at the end of 2012. With this addition, our portfolio nears $500.0 million of asset value. 218 West 18th Street gives ARC its first exposure to the Midtown South sub-market known as "Silicon Alley" in exclusive Chelsea. The building has a roster of first-class tenants and has recently undergone a comprehensive renovation.” See story in the New York Post.