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Boston Properties (BXP) Buys 360 Park Avenue South in Manhattan

Boston Properties (BXP) expands in the Manhattan market with the acquisition of the office property, 360 Park Avenue South.

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This story originally appeared on Zacks

Boston Properties, Inc. BXP has acquired 360 Park Avenue South in the Midtown South submarket of Manhattan, NY, from Enterprise Asset Management, Inc. Per the press release, Boston Properties began transforming the 450,000 square-foot, 20-story office property immediately after the acquisition.

- Zacks

As part of its Strategic Capital Program, Boston Properties accomplished the buyout through a newly formed joint venture (JV) with two institutional partners for roughly $300 million.

Boston Properties, which owns 42% interest in the property will serve as the managing member and provide customary property management, leasing and other services. BXP expects this investment in the JV to be accounted for under the equity method of accounting.

The acquisition seems a strategic fit with Midtown South submarket emerging as a preferred location for companies and young professionals in the technology, advertising, media and information (TAMI) sector.

Moreover, the property is positioned in a highly desirable location for the growing cluster of technology companies. With the addition of amenities, public and private spaces through repositioning, the property is likely to lure technology and creative firms.

Per management, “360 Park Avenue South marks the second acquisition we have completed through the Strategic Capital Program since July, underscoring the Program’s impact as we seek to enhance the Company’s competitive position when evaluating new investment opportunities.”

BXP owns and operates 8.8 million square feet of premier office space in Manhattan, mainly in the Park Avenue and Plaza Districts. As of Sep 30, 2021, the properties were 94% leased to credit-strong clients. With its portfolio of modern, class A office buildings, Boston Properties is well-poised to benefit from the flight-to-quality preference of office tenants.

Shares of this currently Zacks Rank #3 (Hold) player have gained 17.8% year to date, underperforming the industry's rally of 26.5%. You can see the complete list of today’s Zacks #1 Rank stocks here.

Zacks Investment ResearchImage Source: Zacks Investment Research

Stocks to Consider

Some better-ranked stocks from the REIT sector are OUTFRONT Media OUT, Cedar Realty Trust CDR and Condor Hospitality Trust CDOR.

The Zacks Consensus Estimate for OUTFRONT Media’s 2021 fund from operations (FFO) per share has been raised 13.8% over the past two months. OUT’s 2021 FFO per share is expected to increase 45.71% from the year-ago quarter’s reported figure.

OUTFRONT Media flaunts a Zacks Rank 1 (Strong Buy) at present. Shares of OUT have gained 21% year to date.

The Zacks Consensus Estimate for Cedar Realty’s current-year FFO per share has been raised 2.6% to $2.36 in the past two months. Over the last four quarters, CDR’s FFO per share surpassed the consensus mark twice and missed the same on the other two occasions, the average surprise being 6.4%.

Currently, CDR sports a Zacks Rank of 1. Shares of Cedar Realty have appreciated 120.7% year to date.

The Zacks Consensus Estimate for Condor Hospitality Trust’s 2021 FFO per share has been raised 25.8% over the past two months. CDOR’s 2021 FFO per share is expected to increase significantly from the year-ago quarter’s reported figure.

Condor Hospitality carries a Zacks Rank of 2 (Buy) at present. Shares of CDOR have soared 101.7% year to date.

Note: Anything related to earnings presented in this write-up represent FFO — a widely used metric to gauge the performance of REITs.





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