Capital buys on Broadway.

Capital Properties will soon be the new owner of two landmark office buildings near Trinity Church on Broadway, principal Richard Cohen said.

"These buildings are unique in that there is nothing around them," Cohen said. "The sun and light on them is great."

When contacted last week, Cohen said he was expecting to complete the purchase within a few days of 111 and 115 Broad way for approximately $130 million. The sale price is close to $100 million over its sale price four years ago.

The Trinity Building at 111 Broadway, the larger of the two buildings, is a 21-story, Class B office building with 460,000 square feet. It is 93 percent leased with average rents at $44.89 per square foot, according to a Costar Property Group database.

The U.S. Realty Building at 113 Broadway is a 22-story, Class A office building with 430,000 square feet of space. It is 100 percent leased with average rents at $150 per square foot, according to Costar.

The two buildings are near Trinity Church and Trinity Cemetery, but few other office buildings are in the immediate vicinity. The buildings are separated by Thames Street, which Cohen is hoping to turn into more of a retail and pedestrian-focused strip.

"We have the ability to create a retail street along Thames Street using the existing archways on the street. There is also unused basement and retail space," Cohen said.

Current retail tenants at 111 Broadway include Cedar Wine & Spirits Co. which occupies 2,000 square feet and Fleet Bank and U.S. Trust Company of N.Y., which both occupy 4,000 square feet. A restaurant, Suspenders of Wall Street Restaurant, occupies 5,000 square feet in the basement.

At 115 Broadway, current tenants include Stanley Cobbler and Stanley's Cobbler Shop, which occupy 1,000 square feet, and Travel Network which occupies 2,000 square feet, according to Costar.

Capital Properties bought the two buildings, the company's first investments in New York City, from a pension fund controlled by Illinois Tool Works. The fund, which purchased the buildings as an investment in 1996, paid $37.38 million to owners Newmark Associates. Cohen said the company, which owns numerous commercial and residential buildings in Boston, Washington, D.C., and other locations, has been looking for property to purchase in New York for some time. Capital Properties typically purchases "highly specialized buildings" as long-term additions to its building portfolio, Cohen said.

Capital Properties was attracted to the location and quality of the buildings, which are notable for their limestone-faces, Gothic architecture, and meticulous details including towers, gables, and carvings. After conducting "due diligence" on the property, Capital Properties aggressively pursued the acquisition, placing on a non-refundable deposit on it.

The two buildings, built in 1904-7 and designed by Francis Hatch Kimball, are city landmarks so building alterations must receive approval from the city's Landmarks Preservation Commission.

"The construction of these enormous slabs was a major undertaking entailing the relocation of Thames Street and the construction of caissons 80 feet into the marshy subsoil," according to a commission description of the buildings.

Cohen said Capital Properties has hired architects Beyer Blinder & Belle to design changes to the buildings. One of reasons for selecting that particular firm is that it has worked on other city landmarks, like the Chrysler building, and is familiar with the governmental and other procedures dealing with landmarks.

"There's a lot of approvals that we need to get, but we're confident that we'll be able to do what we want with the buildings," Cohen said.

So far, plans for the two buildings are receiving positive reviews. Carl Weisbrod, president of the Alliance for Downtown New York, said he has had preliminary discussions with Capital Properties, but has not seen detailed plans for changes to the buildings.

"They're beautiful buildings," Weisbrod said. "We're optimistic that the change will them even more productive buildings."

Cohen said Capital Properties typically acquires $100 to $200 million in property each year, but in 2000, the company has completed more than $200 million in acquisitions. Although he expects the company will make fewer acquisitions next year, it will continue to look for New York City property to acquire.

"It's a very difficult market to break into. It's very competitive," Cohen said.