News
INTERCONTINENTAL'S BIG NJ DEAL
August 9, 2011
| Boston-based Intercontinental Real Estate Corp laid down $215M to purchase and renovate of a 770k SF Plainsboro, NJ data center into the new US HQ for Danish pharma firm Novo Nodisk. |
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| We snapped Intercontinental CEO Peter Palandjian with a favored painting by Melanie Taylor Kent and a sculpture called The Entrepreneur by Jim Rennert. Peter says that the deal that closed last week for 800 Scudders Rd in Plainsboro (the largest NJ CRE transaction this year—not counting Snooki's last haircut) is a signal of commercial banks? renewed confidence in the US CRE sector. Since ?07, he says, there have been few deals of this size. That the lenders, Sovereign Bank and Wells Fargo, are willing to put a large, construction loan directly onto their balance sheets shows that they see significant upside for this JV of Intercontinental with Montvale, NJ-based Ivy Equities, and NYC-based LCOR Corp. |
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| Intercontinental CFO/COO Paul Nasser tells us that lenders like the limited risk of Intercontinental?s latest venture: Novo Nordisk has agreed to lease 563k SF for 15 years as its new US HQ and has an option to take the entire building at any time. As Peter says, this deal has the appeal of value-add returns but the assurance of safe, core attributes since Novo Nordisk is a long-term, credit-worthy tenant. Also, since at least half of the subcontracts have been bought out, the project cost is set. LCOR, the construction manager, will start the gut renovation next month with completion scheduled for spring '13. The JV team plans to strip the ?85 vintage former Merrill Lynch-cum-Blackrock data center to its skeletal frame then replace the fa ade, roof, interior, mechanical systems and be LEED certifiable. |
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| At Intercontinental, Tom Taranto and Michael Keyes led the acquisition effort. Boston-based HHF?s NYC office brokered the sale. Intercontinental?s lead investor (in for $55M) is the Northeast Regional Council of Carpenters whose executive secretary-treasurer Michael Capelli said the deal will create 500 construction jobs and an investment that will strengthen his members? pension and annuity portfolios. Also investing with Intercontinental are the NJ Laborers and NJ Operating Engineers. Together, the three unions will invest $100M. Novo Nordisk, which will relo from Princeton, was repped in the lease by Newmark Knight Frank's Steven Tolkach. |
