Paramus-based fund buys troubled asset from AIG

NJBIZ, Jun 8, 2009 by Lee, Evelyn

KABR Real Investment Partners LLC last week announced it acquired 85 Challenger Road, a 235,000square-foot Class A office building in Ridgefield Park, from insurance giant AIG.

85 Challenger Road was the first large vacant building to be put up for sale by a lender since the 1990s, said Gary Gabriel, executive vice president at the East Rutherford office of commercial real estate brokerage Cushman & Wakefield, which brokered the deal.

The previous owner, Westport, Conn.-based Heyman Properties - which had unsuccessfully tried for three years to lease the building - had given the building back to the lender under a deed in lieu of foreclosure, said Gabriel, whose firm marketed the property for three-and-a-half months before closing the deal June 1 .

The property, built in 1990, had received 17 bids ranging between $6 million and $12 million, said Kenneth Pasternak, chairman of Paramus-based KABR, a newly formed opportunistic real estate fund. KABR paid in the upper end of that range for the property, which had an assessed value of $38 million, he said.

AIG's sale of 85 Challenger Road was unique, Gabriel said. "We've seen every available attempt from all the lenders that are out there to extend loans, work with borrowers and keep transactions afloat," he said. "AIG made the election to hit a market-clearing price and get their dollars back in the door and move on." - Evelyn Lee