Allied Partners sells share of Citigroup Tower for $400m.

Allied Partners has announced it will sell its share of the landmark Citigroup Tower to co-owner, Boston Properties.

"We want to take advantage of the appreciation that trophy properties have realized and redeploy this capital to mine opportunistic real estate investments for greater returns," said Eric Hadar, CEO of Allied Partners. "Boston Properties is a phenomenal partner, owner and property manager, and we are leaving the very stable Citigroup Center in great hands for the long term."

The two companies bought the 59-story 1.65 million square foot office and retail tower at 153 East 53rd Street for $725 million in 2001. Although neither party has disclosed terms of the sale, the New York Post reported that the REIT paid $400 million for Allied's 35% share of the building. It further reported that Boston Properties had paid $1.5 million for the building's naming rights, a move that should make it more attractive to any future buyer the REIT may decide to court.

It has been on a selling streak of late. In March, the company announced it was in talks to sell two Manhattan properties, 280 Park Avenue and 5 Times Square and would use the proceeds to cut down its debt, buy back shares and for future acquisitions. Although a deal to sell the Times Square tower to Istithmar fell through earlier this month, the Dubai-based investment holding company did slap down $1. 2 billion in cash for 280 Park, according to recent SEC filings.

By press time, Boston Properties had not returned calls seeking comment on the latest transactions.

Allied Partners, meanwhile, has a $500 million purse for new investments, according to president, Robert Vahradian, who indicated the firm would now focus on existing properties, real estate development and mezzanine lending in New York and certain major metropolitan markets worldwide

"We have tremendous in-house capital and move very quickly for the right opportunities," Vahradian said.

The Allied portfolio consists of 25 properties including recent acquisitions 568 Broadway, 95 Wall Street and 50 West 40th Street

In addition, Allied Partners is a principal in Terra Holdings, which generate $3 billion in sales annually through its Brown Harris Stevens, Halstead Property and Feathered Nest companies.

Allied Partners is also an active lender, specializing in the origination of mezzanine and preferred equity, as well as the acquisition of existing subordinate debt positions.

Said Eric Hadar, "We are delighted by our relationship with Boston Properties, and look forward to working with them again in the future."