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SL Green Realty Corp. (SLG - Analyst Report), a real estate investment trust (REIT), recently acquired 635 Sixth Avenue and 641 Sixth Avenue office properties for a total purchase price of $173.0 million. The properties along the lower Sixth Avenue retail corridor in New York were acquired from Atlas Capital Group, LLC in an off-market transaction.

635 Sixth Avenue spans 104,000 square feet and is currently vacant. SL Green plans to redevelop the property as a high quality retail and commercial centre. 641 Sixth Avenue is a multi-tenant office building spanning 163,000 square feet and is currently 100% occupied.

This is an important acquisition for SL Green owing to the location of the two properties in virtually the heart of the vibrant Midtown South submarket in New York. The two adjacent properties cover the whole block between the 19th and 20th street in Midtown South.

Midtown South is one of the prime office submarkets of the city with a vacancy rate of 4% (according to a research report by real estate services firm Colliers International). The acquisition is in line with SL Green's policy of investing and harnessing the potential of prime properties through strategic off-market transactions.

SL Green Realty primarily acquires, owns, repositions and manages Manhattan commercial properties. As of June 30, 2012, SL Green owned interests in 71 Manhattan properties totaling more than 39.2 million square feet. This included ownership interests in 27.4 million square feet of commercial properties.

SL Green Realty currently retains a Zacks #3 Rank, which translates into a short-term Hold rating. We also have our long-term Neutral recommendation on the stock. One of its competitors, Boston Properties Inc. (BXP - Analyst Report) also holds a Zacks #3 Rank.

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