CB Richard Ellis Brokers Largest Office Sale Ever in New Jersey

Campus Drive In a transaction that sets the standard for valuing trophy suburban commercial real estate assets, Park Avenue at Morris County in Florham Park, NJ traded for $362.4 million or $323 PSF––the largest office sale ever transacted in the State of New Jersey. Jeffrey Dunne, Kevin Welsh and David Gavin of CB Richard Ellis’ New York Institutional Group collaborated with Samuel Buckley of CB Richard Ellis’ Saddle Brook office to represent ownership. The team was also responsible for procuring the buyer, KBS Real Estate Investment Trust II (KBS REIT II).
Park Avenue at Morris County (Park Avenue), located at 100-600 Campus Drive in Florham Park, New Jersey, consists of six Class A office buildings totaling 1,123,545 SF set on a picturesque 136± acre site. The initial closing of 100 and 200 Campus Drive to KBS occurred in September and the four remaining buildings, located at 300-600 Campus Drive, closed on October 9, 2008.

Park Avenue, the New York Tri-State region’s preeminent suburban office park, was developed between 1989 and 1999 and is a multiple BOMA Award winner, including: the 2007 BOMA Building of the Year Award for suburban office campus, the 2006 BOMA Mid-Atlantic Region Building of the Year Award (100 Campus), and the 1998 International TOBY Award. The property’s unparalleled reputation is confirmed by its unmatched “best in class” mix of credit tenancy (nearly 70% investment grade), headquarter-quality construction and finishes, a comprehensive amenity package and a prime commuter location––highlighted by convenient train access to Manhattan from Convent Station situated only two miles from the property––in affluent Morris County. Together, these features rank Park Avenue not only as Metropolitan New York’s top office park asset but also as one of the finest in the nation.

At the time of sale, Park Avenue was 99.1% leased to a diverse and marquee tenant roster that includes a “who’s who” of companies, each having 2007 sales of $4.5 billion or greater: Accenture, BASF, BlackRock, The Hartford Fire Insurance Company, Mapfre Reinsurance, McKinsey & Company, Merrill Lynch, PricewaterhouseCoopers, Quincy Mid Atlantic, Smith Barney, UBS and Wachovia Securities. With its balanced lease roll and extensive and varied tenant roster, Park Avenue offers the kind of secure investment profile desirable in any real estate cycle.

CB Richard Ellis Vice Chairman Jeff Dunne, who led the sales effort, comments that, “The availability of a trophy office asset of this magnitude is highly unusual and a one-of-a-kind investment opportunity. KBS recognized the ability to capture substantial near-term upside by renewing existing tenants at market rents as leases rollover. KBS should experience great, long-term appreciation with this asset.”