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Boston Properties selling in Washington, DC; SL Green in $100M deal for tenant

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Boston Properties selling in Washington, DC; SL Green in $100M deal for tenant

Commercial real estate

* Boston Properties Inc. is divesting the 1333 New Hampshire NW property in Washington, D.C., to The Meridian Group for $140 million, GlobeSt.com reported, citing an unnamed source. The 321,000-square-foot, 12-story property, selling for $436 per square foot, is roughly 84% occupied but will be fully vacant in 2019 when law firm Akin Gump Strauss Hauer & Feld LLP departs, the according to the report.

* SL Green Realty Corp., under an estimated $100 million deal, has committed to take over Carlyle Group LP's existing office lease at 520 Madison Ave. in Manhattan, N.Y., in order to secure the private equity firm as a tenant for the $3 billion One Vanderbilt office tower that it is developing, Crain's New York Business reported, citing unnamed experts.

According to the sources, SL Green agreed to take over Carlyle's existing lease for nearly 120,000 square feet of space at the Tishman Speyer-owned property. Crain's, citing CoStar, reported that Carlyle's lease term in the building will run until 2031, approximately 10 years after it will move into One Vanderbilt.

SL Green's commitment could see the company negotiate a termination of Carlyle's lease agreement for 520 Madison Ave. or fill the office space with another tenant that would take on the remaining rent.

* IPE Real Assets reported, citing confirmation from a spokeswoman, that a consortium led by Deutsche Finance Group is investing in the top floors of the Gucci Building on Manhattan's Fifth Avenue that was owned by GGP Inc. and Thor Equities.

The consortium includes German institutional investors Bayerische Versorgungskammer and Versicherungskammer Bayern Group, Turkish private equity real estate firm BLG Capital, and institutional funds managed by Deutsche Finance Group. The responsible entity for the recently acquired property is Deutsche Finance Group's newly established U.S. arm, Deutsche Finance America.

* Maintenance supply company W.W. Grainger has subleased 100,000 square feet at Vornado Realty Trust's theMART building in Chicago from Motorola Mobility, Crain's Chicago Business reported, citing unnamed sources. The property was formerly known as Merchandise Mart. Grainger also has the option to expand up to 150,000 square feet in the building, the report noted, citing the sources.

* Bloomberg News featured a report on a showdown over Canadian developer Onni Group's plan to replace Seattle's famous Showbox theater with a 44-story apartment tower. The development proposal became public in late July, and an online petition to designate the theater as a historic landmark has garnered more than 90,000 signatures along with support from notable musicians.

* The Chicago area industrial market's second-quarter vacancy rate fell to its lowest point since early 2001, Crain's Chicago Business reported, citing Colliers International. The vacancy rate came in at 6.44%, compared to 6.69% in the second quarter of 2017.

* Nicola Crosby Real Estate paid $50 million for the Westgate I office building in Houston, Texas, Commercial Property Executive reported, citing Yardi Matrix data. The 5.9-acre class A property at 17220 Katy Freeway was sold by Miller Global Properties. The building is 95.7% leased.

After the bell

* Brookfield Asset Management obtained an option to purchase the land underneath the 666 Fifth Ave. office condominium in New York City from Kushner Cos. as part of a 99-year lease deal, The Real Deal reported, citing a memorandum of lease.

* Columbia Property Trust Inc. could acquire a 50% stake in the office project at 799 Broadway in Manhattan from Ares Management LP, Bloomberg News reported, citing people familiar with the matter.

The day ahead

Early morning futures indicators pointed to a higher opening for the U.S. market.

In Asia, the Hang Seng dropped 0.66% to 27,752.93, while the Nikkei 225 gained 2.28% to 22,356.08.

In Europe, around midday, the FTSE 100 gained 0.02% to 7,643.69, and the Euronext 100 rose 0.43% to 1,065.51.

On the macro front

The import and export prices report and the Redbook Index for retail sales are due out today. The National Federation of Independent Business' index of small business optimism increased to 107.9 in July from 107.2 in June.

Click here to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

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