The California State Teachers Retirement System (CalSTRS) has been revealed as the buyer of a $470m (€400m) down-town New York City office property.
The US pension fund has invested $260m in the asset – around 55% of the deal – through a joint venture with New York City-based MHP Real Estate Service.
The deal was carried out via CalSTRS’s separate account real estate manager Clarion Partners.
The property is currently 66% vacant, with around 800,000sqft left empty by the departure of Goldman Sachs.
CalSTRS said it had a full-scale capital and leasing plan for the next five years that would result in an increase in capitalisation for the property.
The pension fund classified the 1.2m sqft asset, at 180 Maiden Lane, as value-added.
Gary Rufrano, director and a member of the acquisitions group at Clarion, said there would be “many tenants who will be looking for space” in the area.
“Rental rates in the sub-market are 25-35% less than in Manhattan,” he said.
“There also is the fact that, in the down-town area, new amenities like shops, restaurants and housing options have been added to the sub-market over the past couple of years.”
MHP, which will oversee the day-to-day operations of the property, will carry out a $28m refurbishment of the property’s lobby and amenities.
The redevelopment includes the addition of a cafeteria and fitness centre for tenants.