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NEWARK-The process is off and running as Verizon New Jersey gets ready to sell three key assets, including its headquarters, and Grubb & Ellis has been given the assignment. As reported by GlobeSt.com, the telecom company is looking to divest the three properties and ultimately consolidate to a new location in Northern New Jersey.

“We’re putting the properties up for bid, subject to sealed bids, either for the individual assets or all three,” Matthew Schnurr, SVP in Grubb & Ellis’ Fairfield, NJ office, tells GlobeSt.com. Schnurr and colleagues John Hoffman and Mike Harrington of the firm’s capital markets group are taking the properties to potential investors, and three of the firm’s brokers on the user side are courting that audience.

The three buildings include the landmark 20-story, 450,000-sf headquarters building at 540 Broad St. here. The second is 175 Park Ave. in Madison, a 210,000-sf facility currently used as a switching center and for general offices, “but everyone looking at the deal assumes it will be rehabbed to class A standards,” Schnurr says. The third is a 30,000-sf building at 1000 Cellar St. in Scotch Plains, and while it sits on five acres, a small stream might preclude future expansion.

In terms of timeline, bids are due October 31. Any disposition also has to be cleared through the state’s Board of Public Utilities, which could take anywhere from a couple of months to a half-year. “We’re estimating that the close will probably be in Q2 of next year for all three assets,” Schnurr tells GlobeSt.com.

“Verizon has said that they will probably be leasing back all three buildings for six months,” he says. “So they will probably have space in all three buildings until the end of next year. And they will likely be leasing back the entire fourth floor of 540 Broad St. on a longer term basis for executive use.”

And while some have suggested that because of its age the late 1920s-vintage 540 Broad St. might be converted to other uses, such as residential, “the building was completely rehabbed over the past few years for approximately $55 million,” Schnurr says. “Virtually all of the internals are brand new. It’s a fabulous building. Most of the investors talking to use right now are looking to re-tenant the building.”

The brokers have sent out more than 3,000 electronic “teasers” on the offering, Schnurr says, “and we have more than 100 confidentiality agreements back already. It’s very encouraging.”

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