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RIDGEFIELD PARK, NJ-A newly formed investment group has snapped up 85 Challenger Rd., a vacant, 235,057-square-foot office building here. The property had been listed on Real Capital Analytics’ “Troubled Asset Radar” for the New York Metropolitan region.

The buyer was KABR Real Estate Investment Partners LLC, which targets opportunistic purchases in the New York Metro area and South Florida. It was founded by its chairman, Kenneth Pasternak, former CEO of Knight Trading.

The newly formed value fund, comprised largely of its partners’ capital, looks to buy through the market cycle bottom. “Eighty-five Challenger is a terrific, class A property that came onto the market at the right time for the right price,” says Pasternak in a statement. “KABR is fortunate to be unencumbered by the typical ‘market top’ purchases of the last several years, so we are able to employ a fresh balance sheet to acquire distressed properties.”

Adam Altman, managing director and partner at KABR, tells GlobSt.com that his firm had entered into the bidding for the building only three weeks earlier. However, since it was able to pay all-cash, KABR was able to win the deal over more than 17 other bidders, he says.

He declines to reveal the price KABR paid for the building, which was acquired from an affiliate of AIG, in an REO sale. “They needed to find a market,” Altman says, “and they were realistic about the asset’s worth.”

Arranging the sale was Cushman & Wakefield’s Metropolitan Area Capital Markets Group, which consisted of Andrew Merin, Gary Gabriel, David Bernhaut and Jose Cruz. Merin tells GlobeSt.com that his team was brought on board to sell the property in late January. “It was a highly watched deal not only in New Jersey, but the region,” he says. “There are few transactions taking place, but we were able to find a market for a vacant office building.” He also declined to reveal the sales price, but said both seller and buyer were “pleased.”

Having an all-cash buyer further facilitated the deal. “In today’s market, buyers are not only looking at price, but the capital stack” of the buyer, Merin states. Back in 2003, the building, which was built in 1990, was sold by Daewoo International (America) Corp. to an affiliate of Heyman Properties of Westport, CT, for $20.5 million.

Altman says that several medium-size and large users have expressed interest in renting space in the building. “I was shocked by the number of inquiries,” Altman says. He declines to specify the asking rents for the building, but says that class A space in the state typically leases from the mid- to high-$20s per square foot. To recreate the building today would cost between $250 to $350 a square foot, he adds. The previous owner renovated the lobby with stone flooring, wood wall paneling and designer furniture for $1 million, Altman notes.

The property sits within the 60-acre Overpeck Centre, which is adjacent to the junction of Route 46, Interstate 80 and the New Jersey Turnpike. It has an historic occupancy rate of more than 90%. The mixed-use office park serves as home to Bank of America, Samsung and AGFA. It is the only office park in Northern New Jersey to have its own exit off the Turnpike–Exit 68. The complex offers access to mass transit and is within walking distance to a 22-acre county park.

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