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Jericho Plaza (Photo by Judy Walker)
By: David Winzelberg January 4, 2022
A New Jersey-based real estate investment firm has purchased the two-building Jericho Plaza office complex for $213 million.
The Birch Group, headquartered in Jersey City, acquired the iconic 695,000-square-foot complex on 51 acres in the deal that closed last week.
This is the third ownership change in the last six years for the Jericho Plaza property, which has experienced a comeback of sorts from the last recession. The complex had dropped to about 60 percent occupancy in 2014, when its appraised value sunk to around $100 million.
Today, Jericho Plaza has an occupancy rate of 96 percent, thanks to extensive renovations that helped attract new tenants over the last few years. The healthier occupancy was boosted by the recent leasing of 96,867-square-feet at 2 Jericho Plaza by 1-800-Flowers.com.
Paul Amoruso, who’s brokerage firm Oxford & Simpson spearheaded the leasing campaign at the complex, says its tenant roster, which includes Deloitte, Morgan Stanley, UBS, Valley National Bank, Oppenheimer and many others, speaks for itself.
“We took on this opportunity to be not only the exclusive leasing agent, but also a partner in the property,” Amoruso told LIBN. “The location has always been pristine, but the complex became tired with deferred maintenance. The Onyx Equities and Oxford & Simpson team rejuvenated the design and its overall presentation to attract tenants like 1-800-Flowers.”
Jericho Plaza’s trapezoid-shaped buildings, designed by Woodbury-based Spector Group, were developed on the site of a former sod farm in 1980 by the Chasanoff family, who sold the office property to S.L. Green and Onyx Equities for $210 million at the height of the market in April 2007.
The acquisition was financed with a $163.75 million commercial mortgage-backed securities loan based on an appraisal back then of $234 million, according to Trepp, a Manhattan-based CMBS analyst.
In order to refinance Jericho Plaza, S.L. Green and Onyx needed a large injection of capital, so they added two new equity partners in Taconic Capital and Triangle Capital Group in 2015, which resolved the original CMBS loan at a $73.6 million loss.
That same year, Onyx and its ownership partners embarked on a nearly $10 million renovation of the trophy asset that Long Island Business News once named one of the top 10 office addresses on Long Island.
In June 2019, Manhattan-based DRA Advisors partnered with Onyx Equities to purchase the two-building, 695,000-square-foot Jericho Plaza for $158.25 million in a transaction that was more of a recapitalization than an outright sale.
Last week, the complex’s ownership group of DRA, Onyx and Amoruso sold the two buildings to Birch Group. Meanwhile, Onyx is partnering with Amoruso’s Oxford Hospitality on a project to develop a hotel on 5.88 acres of the Jericho Plaza property. The planned 113,815-square-foot, $56 million hotel and conference center just received economic incentives from the Nassau County Industrial Development Agency.
The Jericho Plaza acquisition is the second major Long Island office buy in 13 months for Birch Group. In Nov. 2020, the company purchased the 348,500-square-foot office complex on 8.64 acres at 1979 Marcus Ave. in Lake Success for $62 million.
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