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NEW YORK CITY-A Fifth Avenue office building marks the first acquisition by a newly formed joint venture between Olympus Real Estate Partners and Murray Hill Properties. A source close to the deal tells GlobeSt.com the price tag in the neighborhood of $127M.

Olympus, with offices here and in Dallas, and locally based Murray Hill are the new owners of 417 Fifth Ave., an 11-story class B office property located between 37th and 38th streets in Midtown’s Grand Central District. Darcy Stacom represented seller EBS Fifth Property Associates LLC, a partnership of Blackacre Capital Group and Emmes & Co. The deal, which closed on Thursday, was one of Stacom’s last acts on behalf of Cushman & Wakefield before leaving the firm to join rival CB Richard Ellis. It is Olympus’ first New York City acquisition.

“This property is unique in that it offers good current yield as well as near-term upside through several substantially under-market leases, which will expire over the next several years of our contemplated hold period,” Clark Hanrattie, a partner in Olympus Real Estate’s New York office tells GlobeSt.com. Hanrattie says Olympus’ “typical four-to-six-year investment in assets” is “consistent with how we underwrote this” transaction.

“Properties such as 417 Fifth Avenue cater to a broad base of tenants and typically provide for a significant rental-rate advantage over Class A buildings, particularly when in-place rents are significantly below market, as is the case with this property,” says Norman Sturner, a co-founder of Murray Hill Properties who directs the firm’s acquisitions and dispositions.

Management and leasing of the building, formerly handled by Emmes Realty Services LLC, will be done in-house going forward, according to an Emmes spokesperson.

“With an intensive ownership, management and leasing focus, buildings like 417 Fifth Avenue can be extremely attractive to astute tenants and investors alike, and provide an intelligent space/value proposition for the tenants while also yielding superior risk-adjusted returns to the owner,” Sturner states.

Built in 1911, the 412,000-sf tower contains 36,000 square feet of retail space and 35,000-sf floor plates for above-grade office tenants. The building has undergone nearly $15 million in capital improvements during the last several years, with additional renovations and investment to be provided by the Olympus/Murray Hill JV going forward. The property is 98 percent occupied, predominantly by full-floor tenants from the financial services, consulting, telecommunications, consumer software and real estate industries.

Hanrattie declines to specify the JV’s plans, but says he is open to the idea of expanding the venture with Sturner and Murray Hill. “If you look at our track record, we look for assets where we can create value,” he tells GlobeSt.com. “If an opportunity presents itself here in New York, it’s likely we would pursue it with Norm.”

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