DivcoWest Properties has acquired an office building in Boston for its latest fund, for which it is still raising capital.
The US fund manager has bought the 955 Massachusetts Avenue building for $66m (€58.6m), according to sources familiar with the matter.
The asset will be one of the first assets to be held by DivcoWest Fund V, according to industry sources.
DivcoWest, which declined to comment, is understood to be seeking $1.6bn for the fund, having already attracted a number of US pension funds, including the California State Teachers’ Retirement System.
The acquisition in Boston comes days after it was revealed that DivcoWest had sold an office portfolio in the city on behalf of the predecessor vehicle, DivcoWest Fund IV.
The 95,000sqft building at 955 Massachusetts Avenue was sold by Brickman Associates, which purchased it for $35.7m in 2007.
It is located with the Mid-Cambridge office market of greater Boston, within walking distance to Central Square and public transportation links.
Boston is one of the target markets for the new fund, alongside office markets in the San Francisco Bay Area, Seattle, Austin and Washington DC.
Fund V will be investing in existing assets that can be improved and development projects with a view to selling them as core, stablised assets.
DivcoWest is aiming for an internal rate of return of 10% to 13%, using around 65% leverage.