BOSTON - Old South Church has finally parted with the building that sits on property the church has owned since 1669.

The church recently sold the office building at 294 Washington St. to RAK Group Acquisition Corp., the investment arm of New York-based RAK Group. The 11-story, beaux arts-style building - also known as the Old South Building - was constructed in 1903 by an outside group. However, the church retained the ground lease and took back the property during the Depression.

"This is an extraordinary opportunity to upgrade and maximize the upside potential of a strategically located property in one of the country's strongest office markets," says Randy Kohana, president and founder of RAK. The company specializes in under-performing office, residential and retail assets in the central business districts of major cities.

"Boston fits in perfectly with our strategy of investing in selected major U.S. cities," adds Michael Zerner, a RAK principal. "It's a great complement to our assets in Dallas and Chicago."

The building, which houses more than 140 tenants, has little available space.

However, RAK cannot stand pat because 75% of the leases expire during the next two years. Of course, RAK also has an opportunity because the current lease rates are significantly below market rates for downtown Boston.

"We're planning a major renovation that will bring this property into the 21st century as an outstanding Class-B+ building," Kohana says.

The modernization program will include upgrading the lobby and elevators, replacing window air-conditioning units, installing new windows installing state-of-the-art wiring. A concierge service also will be added to the building.

SANTA MONICA, Calif. - The Macerich Partnership LP and Ontario Teachers' Pension Plan Board closed Feb. 23 on the first phase of their two-phase acquisition of properties from various Safeco Corp. entities.

Phase I includes the purchase of three regional malls and one mixed-use project totaling 3.2 million sq. ft. The total purchase price of Phase I properties is about $427 million. Macerich owns 51% of the purchasing entity, and Ontario Teachers' owns 49%.

Phase II, which covers the purchase of the mixed-use portion of Redmond Town Center near Seattle, is expected to close in May. The 581,000 sq. ft. complex is home to the headquarters of AT&T wireless.

The allocated purchase price for the AT&T complex will be approximately $115 million.

In the January edition of NREI, the Newsletter section included an item of the revitalization of downtown Silver Spring, Md. While the news item mentioned the overall project architect, it did not mention that Gensler's Washington, D.C., office is the architect of record for the renovation of the historic Silver Theater on Colesville Road.

Gensler also is building an East Coast location for the American Film Institute adjacent to the theater.

Kate Kirkpatrick says Gensler is working closely with Fougler-Pratt Development, the Art Deco Society of Washington and the Montgomery County and Maryland governing bodies to recreate the art-deco theater that used to highlight the Silver Spring landscape.

"The addition of the latest in theater activity will create a 'retro-futuristic' atmosphere that will fit well with the modern attractions being brought to the neighborhood," she says.

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