A New York hedge fund has paid $565M for a majority stake in 21 suburban office buildings spread from Pennsylvania and New Jersey to Houston and Las Vegas.

Lexington Realty Trust sold the portfolio, which spans 3M SF, to a joint venture controlled by Davidson Kempner Capital Management. Lexington, a publicly traded real estate investment trust, announced that it would retain 20% ownership of the new joint venture and provide asset management services for it. DKMC would own 80% of the new partnership that acquired the portfolio for $726M.

The sale continues Lexington's aim of selling off its vast holdings in suburban office buildings and pivoting to ownership of net-leased industrial assets, it said Tuesday morning when announcing the deal. Sixty percent of its portfolio will be in industrial assets once the deal goes through, compared with 44% at the end of 2017.

The office portfolio is 98.6% leased and averaged $15.38 per SF in rent last year, Lexington said in a shareholder presentation. Six of the properties are in Texas, including two in Houston, and four are in Colorado. Tenants leasing space include Amazon for its Huntington, West Virginia, customer service center and the U.S. government.

DKMC owns assets worth more than a combined $30B, and it states on its website that it seeks to invest with a "bottom-up" and "event-driven" strategy.