Murray Hill Properties and Olympus Real Estate subsidiary Milestone Group brought in Israeli developer El Ad Group as majority equity partner for their recent purchase of New York's Gift Building, a 380,000-square-foot office/showroom at 225 Fifth Avenue

Real Estate Alert, May 5, 2004

Murray Hill Properties and Olympus Real Estate subsidiary Milestone Group brought in Israeli developer El Ad Group as majority equity partner for their recent purchase of New York's Gift Building, a 380,000-square-foot office/showroom at 225 Fifth Avenue. Word is that El Ad contributed $13 million of equity for the $111 million purchase.

The deal is a "forward sale," which means El Ad won't receive a controlling stake until 2007, when 95% of the leases expire. The owners would likely convert the building into residential condominiums at that point, although they would have to buy out remaining leases first. The buyers will receive an initial annual yield of 5.1%. CB Richard Ellis handled the sale for Japanese investor Green Stamp America.