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399 Jefferson Road
Parsippany, NJ

Recognizing the inherent value of this well located 180,000-square-foot single-story granite and glass office building, Prism outbid several major, institutional organizations in 2003 when it acquired 399 Jefferson Road. The company paid $20.7 million at a federal bankruptcy auction, completing the "all-cash," transaction in just 10 days. Factors that contributed to Prism's confidence in the building included: 50% below-market rent being paid by the property's existing tenant, Medco Health Solutions, with three years remaining on its lease; the building's heavy mechanical infrastructure, high ceilings, a tenant-invested capital commitment and an outstanding approved parking ratio of 7 cars per 1,000 square feet.

Medco subsequently announced its intention to leave the property at the end of its lease and ceased operations in July 2005, contrary to the pro forma underwriting. In response, Prism immediately commenced marketing, and by the year-end, HSBC, an international banking company, had signed a definitive agreement to purchase the asset for more than $33 million. HSBC gutted the building, but its intended use for the property changed, and the company never took occupancy.

When 399 Jefferson Road again came online in 2010, Prism re-purchased it at a highly opportunistic discounted price of $5,125,000. Relying on the very same fundamental reasons that made it an attractive investment back in 2003. By year's end 2010, Pinnacle Foods leased 85,000 square feet there for its headquarters and subsequently expanded its commitment by 20,000 square feet. Currently, Prism is finalizing plans for the redevelopment of the building's main entrance and exterior courtyard.