Friday, December 30, 2011

2050 Main in Irvine Sold for $108.5M

AEW Capital Management announced that is had purchased the 13-story office building at 2050 Main Street in Irvine, CA for $108.5 million, or roughly $345 per square foot, according to a CoStar report. AEW bought the property on behalf of one of its institutional clients from a joint venture of Westbrook Partners, Walton Street Capital and Greenlaw Partners. AEW was self-represented in the transaction while the seller was represented by Eastdil Secured.

"We are very pleased with the acquisition of 2050 Main St.," said Daniel Bradley, AEW director, in a statement. "It is considered a high-quality trophy property in a premier location with high tenant demand. In addition, its pending LEED Gold Certification will help solidify the property's top-tier status."

The 315,000 square foot office building was built in 2007 and was reportedly 80% leased at the time of sale. 2050 Main Street is part of the Irvine Concourse Corporate Center, a development comprised of 10 office towers, hotels, a health club and three restaurants, in the Orange County John Wayne Airport submarket.

For more news and information visit Blumberg Capital Partners.

Thursday, December 29, 2011

Ventas Acquires Cogdell Spencer

Ventas, Inc. announced this week that it would acquire Cogdell Spencer Inc., a real estate investment trust (REIT) with 72 medical office buildings (MOB), according to a Bloomberg report. Cogdell shareholders will get $4.25 per share; at closing, Ventas's investment, including its share of debt, is expected to approximate $760 million to $770 million, before anticipated transaction expenses. Cogdell has reached an agreement under which Cogdell's design-build and development business will be sold to an affiliate of Lubar & Co., a private equity firm affiliated with David Lubar, prior to completion of the Ventas transaction.

"We are delighted to announce this strategic and accretive acquisition that further broadens our footprint in the attractive MOB sector, continues to diversify our business and tenant relationships and keeps our balance sheet strong," Ventas Chairman and Chief Executive Officer Debra A. Cafaro said. "Cogdell's high-quality properties enhance our medical office building market presence, especially in the southeast, and provide an opportunity to scale our Lillibridge Healthcare Services subsidiary platform. We look forward to successfully integrating the Cogdell properties into the Ventas portfolio."

After the deal, "Ventas will have the leading MOB business in the U.S., with over 20 million square feet owned or managed, and a coast-to-coast presence that is second to none in the healthcare real estate industry," Todd Lillibridge, executive vice-president of medical property operations at Ventas, said in a Reuters report.

For more news and information visit Blumberg Capital Partners.

Wednesday, December 28, 2011

RREEF America Sells Bay Area Industrial Assets for $520M

RREEF America REIT II Corp. and its affiliate, Northern California Industrial Portfolio, Inc., completed the sale of a 5.3 million square foot industrial and flex portfolio for $520 million this month according to a San Jose Mercury News article. PS Business Parks (PSBP) acquired the portfolio and, in connection with the transaction, assumed a $250 million secured loan that matures in December 2016. In addition to the secured loan, PSBP also entered into a three-year unsecured term loan for $250 million with Wells Fargo Bank.

"This is the largest transaction we're aware of in the Bay Area this year," said John Yandle, a senior vice president in the Santa Clara office of Cornish & Carey Commercial Newmark Knight Frank, a commercial realty firm. "There is nothing that would beat a half a billion dollars."

The portfolio consists of 18 multi-tenant business parks comprised of 2.9 million square feet of light industrial space and 2.4 million square feet of flex space in nine Bay Area cities and is currently 82.2% leased to 216 tenants.

For more news and information visit Blumberg Capital Partners.

Tuesday, December 27, 2011

MillerCoors HQ Sold for $91M

250 S. Wacker Drive in Chicago, IL sold for $91 million before the close of the year as Credit Suisse Asset Management, a unit of Credit Suisse Group, takes ownership from Boston-based AEW Capital Management. AEW originally purchased the property in 2007 for $57 million after it underwent a $40 million renovation.

CBRE began shopping the property in November of this year noting that the property is more than 93% leased to mostly long-term tenants, including MillerCoors with a lease of 167,256 square feet of office space covering 8 full floors of the building through 2024. Michael Vesper and Thomas McClayton of CBRE represented the seller, while Benjamin and Debra Lacy of Lacy Ltd. represented the buyer according to a CoStar report.

For more news and information visit Blumberg Capital Partners.

Friday, December 23, 2011

Austin Chamber of Commerce Buys $4.5M Office Space in Hilton

The Greater Austin Chamber of Commerce has purchased 20,000 square feet of office space for $4.5 million in the Austin Hilton Hotel according to an Austin Business Journal article. The space, previously occupied by Faulkner USA, will house 45 employees currently at 210 Barton Springs where the Chamber's lease expires next year. The Chamber will move to the Hilton at 500 E. Fourth St. this coming March.

"The Board was very, very excited about the prospects for this, and very excited that the Chamber of Commerce is going to have a permanent home," said Chairman Bobby Jenkins. He added that the new space will give the Chamber "room to grow — and room to meet."

The Chamber reportedly holds hundreds of meetings a year and, due to their current lease only offering 12,000 square feet of space, have had to rent out rooms at local hotels and other venues to accommodate the attendees. Paul Bury, President of Bury + Partners (which was instrumental in the search for the property), said the Chamber will save "significant dollars" by not having to rent off-site meeting space. He explained that hosting the monthly Board meetings elsewhere cost the Chamber as much as $15,000 a year. "After we evaluated everything, the purchase of the space rose to the top," Bury said. "It's just a win, win, win. We haven't really found a negative yet. We're really excited about the opportunity."

For more news and information visit Blumberg Capital Partners.

Thursday, December 22, 2011

UDR and Kuwait JV Make $154M DC Acquisition

UDR Inc. announced this week that it had acquired, in a joint venture with Kuwait Finance House (KFH), 1301 Thomas Circle in Washington, DC for $154 million. According to a National Real Estate Investor Online article, The acquisition is being funded through a five-year, 2.99%, $90 million interest-only loan from Fannie Mae, a 70% equity contribution by KFH of $44.8 million and a 30% equity contribution by UDR of $19.2 million. Since its formation in 2009, the joint venture has invested $281 million in metropolitan Washington, D.C. through the acquisition of three operating communities containing 660 homes.

1301 Thomas Circle is a ten-story building constructed in 2006 located just minutes from the Mt. Vernon Square and McPherson Metro Stations. Additionally, it is just a short walk from two of the Company's other operating communities, Andover House and View 14, as well as its development project, 2400 14th Street. Following the close of this transaction, the Company will own, or have an ownership interest in, 21 communities consisting of 5,934 apartment homes in the metropolitan Washington, D.C. market.

For more news and information visit Blumberg Capital Partners.

Wednesday, December 21, 2011

The Arbors in Harbor Town Sold for $31.5M to Behringer Harvard

Behringer Harvard announced this week that is had acquired the Arbors in Memphis, TN for $31.5 million according to a Memphis Business Journal article. Behringer Harvard acquired a 94% interest in Arbors through a joint venture between Behringer Harvard Opportunity REIT II, Inc. and Carter-Haston Real Estate Services, Inc. Behringer Harvard bought into the deal with $470,000 of the $500,000 earnest money and $29.1 million of the total acquisition cost, according to an SEC filing.

"Arbors boasts an exceptional infill location on the completely built-out Mud Island, downtown Memphis's strongest apartment submarket," said Mr. Samuel A. Gillespie, Chief Operating Officer of Behringer Harvard's opportunity platform. "We plan to enhance the value of this stabilized asset with an interior and exterior improvement program expected to further enhance its desirability and competitive advantage."

Built in 1991 on a 14.7-acre site at 671 Harbor Edge Drive, the 345-unit multifamily community comprises two phases containing 30 three-story residential buildings and two clubhouse buildings. The cumulative amenities of both clubhouses include three swimming pools, water volleyball areas and sundecks, lighted tennis courts, a sand volleyball court, grilling and picnic areas, laundry facilities, a car wash and vacuum area, and a 24-hour fitness center.

For more news and information visit Blumberg Capital Partners.

Tuesday, December 20, 2011

10 Exchange Place Sold for $285M

10 Exchange PlaceManulife Real Estate, the global real estate arm of Canada-based Manulife Financial Corporation, acquired 10 Exchange Place in Jersey City, NJ for $285 million this month. Manulife picked up the property from a client of Invesco.

"This is kind of unusual," Andrew J. Merin, of Cushman & Wakefield's Metropolitan Area Capital Markets Group, which orchestrated the sale, told GlobeSt.com. Merin, David W. Bernhaut, Gary Gabriel, Brian J. Whitmer and Kyle B. Schmidt represented the seller, a client of Invesco, in the transaction. "Over $1 billion in bricks and sticks will have traded. [...] There is not a lot of quality out there. In July, the market started to slow down. [But] Manulife did all their homework."

"Manulife is always looking for opportunities to grow our real estate investment portfolio and we're extremely pleased to secure these exceptional assets in what are three very important and diverse real estate investment markets," said Kevin Adolphe, Chief Operating Officer of Manulife's Investment Division and President and CEO of Manulife Real Estate. "We are optimistic about the possibilities in these and other key markets and we continue to look for core office, industrial and multi-family residential property investments throughout Canada, the United States and Asia."

Completed in 1988, the 748,005-square-foot building was the recent recipient of BOMA's 2011 TOBY (The Outstanding Building of the Year) award for buildings over 500,000 square feet. LEED-Gold and Energy Star certified, the iconic tower offers unobstructed views of lower Manhattan from every floor. The property was 100% leased at the time of sale with major tenants including ACE Insurance, Daikin McQuay, Kuehne + Nagel, Rabobank, Bank of America, Goldman Sachs and Amazon.com.

For more news and information visit Blumberg Capital Partners.

Monday, December 19, 2011

15 Properties in Japan Sold for $1.6B to JV

Global Logistic Properties Limited (GLP) and China Investment Corporation (CIC) have entered into a 50-50 joint venture to acquire 15 modern logistics facilities in Japan from LaSalle Investment Management for JPY122.6 billion (or $1.6 billion) in one of the biggest-ever property deals in Japan according to a Wall Street Journal report. This purchase marks the first collaboration between GLP and CIC with each company initially investing about $272.9 million. GLP will act as the asset manager of the acquired properties.

In a statement, LaSalle Investment Management said the deal marked the sale of all but two properties held by its US$1.6 billion Japan Logistics Fund, and reaps "strong returns" for the fund's institutional investors. "Global money has returned to Japan in a big way," said Masahiro Mochizuki, an analyst at Credit Suisse Group AG in a Businessweek article. "This transaction means that real estate prices in Japan have fallen to an attractive level."

GLP chief executive Ming Z Mei said: "Demand in Japan continues to come from companies working to become more competitive and are focused on ensuring they have more efficient warehouses. Companies are also rethinking how their supply chains are managed so they can minimise any risk of disruption. As a result, demand for quality modern warehouse space is on the rise, while there remains a lack of supply of modern warehouses. The properties we are acquiring come with a strong tenant profile - 67% of the space is utilised by large third-party logistics service providers and 13% is leased by e-commerce companies."

The portfolio of 15 properties to be acquired will have a Gross Floor Area (GFA) of 770,989 sqm with more than 90% of the GFA located within the Greater Tokyo and Osaka areas. The current occupancy of the properties is 98.3% with a weighted average lease expiry of 5.6 years. The portfolio comprises modern facilities with a weighted average building age of only 6.9 years.

For more news and information visit Blumberg Capital Partners.

Friday, December 16, 2011

Hines Picks Up Fisher Plaza for $160M

Fisher Communications announced this month that it had completed the sale of Fisher Plaza to Hines Global REIT, Inc. for $160 million in cash. Fisher disclosed that the company began marketing the property in early 2008 but, due to the then rapidly deteriorating financial market conditions, suspended the effort to unload the property until March 2011. Fisher has said that it will use a portion of the sale proceeds to redeem the remaining $61.8 million of its 8 5/8% Senior Notes. Moelis & Company and CenturyPacific, LLLP served as Fisher's real estate advisors on the transaction.

Built in 2001, Fisher Plaza is a 300,000-square-foot office and data center complex that includes two six-story buildings in downtown Seattle across from the Space Needle. The buildings and land at 100 and 140 4th Avenue North carried a value of $106 million as of Dec. 31, 2010, according to the company's annual report last year reported Bloomberg. The Seattle building serves as Fisher's headquarters and houses ABC-affiliate KOMO. Fisher will remain the 300,000-square-foot facility's largest tenant, with a 12-year lease for its corporate headquarters according to a Puget Sound Business Journal article.

For more news and information visit Blumberg Capital Partners.

Thursday, December 15, 2011

Southwest Bancorp Sells Nonperforming Assets

Southwest Bancorp, Inc., parent of Stillwater National Bank & Trust Co., announced this month that it had sold over $300 million in nonperforming loans, potential problem loans and other real estate assets. According to an American Banker article, roughly $170 million of the loans are nonperforming; the sale to SW Loan Portfolio Holdings LP and its affiliates will produce a pre-tax loss of $101 million, which it will record in the fourth quarter. The holding company was organized in 1981; on Sept. 30, 2011, it had total assets of $2.6 billion, deposits of $2.0 billion and shareholders' equity of $367.0 million reported Tulsa World.

Rick Green, President and Chief Executive Officer at Southwest, said, "These sales immediately and substantially reduce our nonperforming assets and potential problem loans. We believe this action is a major step toward achieving our goals of reducing problem assets, returning to sustained profitability, resuming dividends, and producing reliable and attractive returns for our shareholders. Southwest's Board of Directors decided to enter these agreements after careful consideration of the potential costs and benefits to Southwest and its shareholders and consultation with financial and legal advisors and management. This included consideration of the estimated costs and benefits of continuing the workout process for these assets over time versus the estimated costs and benefits of their immediate resolution by sale."

For more news and information visit Blumberg Capital Partners.

Wednesday, December 14, 2011

CRE Price Index Shows First Year-Over-Year Improvement in Years

CoStar has released its latest monthly National Composite Index of commercial real estate prices showing a 1.8% gain in October from September, and a 2.2% increase from the same period last year, marking the first year-over-year improvement since the economy and markets took a downturn in 2008. The year-over-year and monthly increases in October reflected long-awaited positive momentum in the composite index notes CoStar, which has now achieved a steady 1.3% average monthly growth rate over the six-month period between May and October 2011,

Other highlights from the CCRSI report include:

October's total of 743 sales pairs is on par with historical averages for transaction activity, according to the CCRSI December 2011 report. At the low point in the last downturn in January 2009, a total of 385 sale transactions were recorded.

As the average transaction size increases, overall transaction volume continues to trend upward, increasing by 29.4% annually in October, while the average deal size increased by 23%.

Stable fundamentals across most commercial property markets and product types, including improving occupancy, and softening downward pressure from distress sales, supported the solid performance of both the investment grade and general indices.

For more news and information visit Blumberg Capital Partners.

Tuesday, December 13, 2011

UnitedHealth Group Sells Eden Prairie Campus for $50M

UnitedHealth Group Inc. completed the sale of its Eden Prairie OptumHealth division to an affiliate of Angelo, Gordon & Co., a New York-based private equity group that buys distressed assets, for $50 million. The sale comes shortly after UnitedHealth bought the property this past June for $39.5 million according to a Minneapolis/St. Paul Business Journal article. UnitedHealth has said that Optum will remain on the campus in a 12 year sale-leaseback deal.

The 90-acre campus is the former ADC Telecommunications headquarters and includes three buildings at 13625 and 13675 Technology Drive in Eden Prairie, MN. The campus has been renovated to house roughly 700 Optum employees that had previously been scattered at various sites throughout the area. UnitedHealth has announced that it is also planning a five-year, $250 million expansion near Highway 62 and Shady Oak Road in Eden Prairie. The 71-acre site will include 1.5 million square feet of office space, a parking ramp and room for light rail.

For more news and information visit Blumberg Capital Partners.

Monday, December 12, 2011

Turkey Creek Sold for $131.7M

Colonial Properties Trust, a real estate investment trust (REIT) based in Birmingham, AL, announced this week that it had sold Colonial Pinnacle Turkey Creek in Knoxville, TN to an institutional pension fund advisor for $131.7 million according to a Knoxville News Sentinel article. Colonial had a 50% JV interest in the property with a group of local investors that were organized in entities called Turkey Creek Land Partners LLC and Farragut Land Partners LLC. "The disposition [...] is another step in the execution of our strategy to simplify the business and sell our non-core assets," stated Thomas H. Lowder, Chairman and Chief Executive Officer. A CoStar report notes that the REIT will use proceeds of the sale to repay a portion of outstanding balance on an unsecured line of credit, with the remainder used to acquire multifamily apartment communities across the South.

Colonial Pinnacle Turkey Creek is a 659,000 square foot retail center built in 2006 on more than 40 acres in the Campbell Station / Farragut submarket of Knox County, just three miles from the I-40/75 junction. The property includes Colonial Promenade and Pavilions and counts Belk, Best Buy, Panera, World Market, the Regal Pinnacle 18 cinema and H.H. Gregg as major tenants.

"The transaction highlights the continuing trend of institutional investors acquiring core assets in secondary markets with more compelling returns than those associated with major market core properties," said Chris Decoufle, one of two CBRE brokers who represented the seller on the Turkey Creek deal. "Both the seller and purchaser were highly pleased with the results."

For more news and information visit Blumberg Capital Partners.

Friday, December 9, 2011

Arco Center in Long Beach Sold for $81M

Arco CenterThe Swig Company of San Francisco announced this month that it had sold the Arco Center in Long Beach, California to Molina Healthcare, a Long Beach‐based medical provider and Arco Center’s largest tenant, for $81 million, or $176 per square foot. Other major tenants include California State Lands Commission and California Marine And Intermodal Transportation System Advisory Council.

Built in 1983, the Arco Center is a 460,000 square foot Class A office complex located at 200 & 300 Oceangate in downtown Long Beach. It was largest office sale in Long Beach since the real estate peak of 2007, said real estate broker Kevin Shannon of CBRE Group in a Los Angeles Times article. The average asking rent per year is approximately $24 per square foot, according to CoStar Group information.

"Arco Center is a tremendous asset to which we have added value through proactive onsite management, leasing and strategic capital improvements and we are delighted that Molina, once the property’s major tenant, is now its owner," said Jeanne Myerson, president and CEO of The Swig Company. "Successful completion of this sale allows us to focus on our goal of further building our portfolio in key markets," she added.

"Molina Healthcare has been doing business in Long Beach for over 30 years, and this purchase reflects our continued commitment to operating here and serving the Long Beach community," said J. Mario Molina, president and CEO of Molina Healthcare, Inc. "Owning this property will allow Molina Healthcare to continue to expand and to provide quality health care to even more people."

For more news and information visit Blumberg Capital Partners.

Thursday, December 8, 2011

USPS Downsizing, May Eliminate 252 Facilities

According to a CoStar report, the U.S. Postal Service is planning to move forward with its proposal to change service standards and massive cuts to its real estate footprint, which may include eliminating 252 out of its 487 mail processing facilities.

"The U.S. Postal Service must reduce its operating costs by $20 billion by 2015 in order to return to profitability," said David Williams, vice president, Network Operations. "The proposed changes to service standards will allow for significant consolidation of the postal network in terms of facilities, processing equipment, vehicles and employee workforce and will generate projected net annual savings of approximately $2.1 billion."

In a presentation delivered at a media roundtable organized by the International Post Corporation during the COP 17 climate conference in Durban, South Africa, U.S. Postmaster General Patrick R. Donahoe spoke about the future of the U.S. Postal Service and made the business case to go green. "Leaner, greener, faster and smarter is our sustainability call to action," said Donahoe. "It's environmentally responsible, as well as a very good business decision."

For more news and information visit Blumberg Capital Partners.

Wednesday, December 7, 2011

Avison Young Acquires Ramsey-Shilling

According to a Los Angeles Business Journal article, Avison Young, Canada's largest independently-owned commercial real estate services company, has acquired LA-based Ramsey-Shilling Commercial Real Estate Services Inc., a full-service real estate brokerage firm. While the terms of the acquisition were not disclosed, the company did note that Ramsey-Shilling Chief Executive Christopher V. Bonbright and Ramsey-Shilling President Mark Evanoff will join Avison Young as principals. Also joining as principals are John Tronson, a Ramsey-Shilling principal who focused on the entertainment division and Michael Dettling, principal and director of Ramsey-Shilling’s health care group.

"We are delighted to add Chris, Mark, John, Michael and the Ramsey-Shilling team to our rapidly-growing Southern California and U.S. platforms,"said Mark E. Rose, Chair and CEO of Avison Young. "Chris Bonbright and his team have a solid market share in Hollywood, West Hollywood, the Westside and other key Los Angeles markets, and are market leaders serving healthcare providers and the entertainment industry."

Avison Young opened its first L.A. office in August 2011, with industry veteran Neil Resnick joining as a Principal to help launch the company's brokerage business in Southern California.

For more news and information visit Blumberg Capital Partners.

Tuesday, December 6, 2011

Expanded $4B US Green Building Program

Former President Bill Clinton and President Barack Obama announced this month that the Better Buildings Challenge has made significant progress, including a $4 billion investment to be used for energy upgrades to buildings over the next two hears. Of the $4 billion, half of the money is a commitment to energy upgrades of federal buildings using long-term energy savings to pay for up-front costs at no cost to taxpayers.

"Upgrading the energy efficiency of America's buildings is one of the fastest, easiest, and cheapest ways to save money, cut down on harmful pollution, and create good jobs right now. But we can't wait for Congress to act. So today, I'm directing all federal agencies to make at least $2 billion worth of energy efficiency upgrades over the next 2 years – at no up-front cost to the taxpayer. Coupled with today's extraordinary private sector commitments of $2 billion to upgrade businesses, factories, and military housing, America is taking another big step towards the competitive, clean energy economy it will take to win the future," said President Obama.

"Investments in building retrofits and energy efficiency can make a real difference in the American economy, by creating jobs, growing our industries, improving businesses' bottom lines, reducing our energy bills and consumption, and preserving our planet for future generations," said President Clinton. "I am proud the Clinton Foundation has been able to help develop and grow President Obama's Better Buildings Challenge, and that so many members of the Clinton Global Initiative (CGI) have joined this Challenge. Working together, I am pleased the commitments to the BBC have grown from the initial $500 million and 300 million square feet that we announced in June at CGI America, to the $2 billion investment with over 1 billion square feet of retrofitted space that we are announcing today."

"The Better Buildings initiative has all the components to make a real difference-it will create profitable investment opportunities for worker pension funds, create badly needed good jobs, increase America's competitiveness around energy savings, and address the dangers of climate change," said AFL-CIO President Richard Trumka.

For more news and information visit Blumberg Capital Partners.

Monday, December 5, 2011

The Arbors Office Park Sold for $12.75M

RexxHall Realty purchased a multi-building office park in South Florida from TA Associates for $12.75 million this month. Details of the sale were not disclosed, but it was noted that Stuart T. Kapp of Proskauer Rose LLP served as RexxHall’s legal counsel while CBRE’s Institutional Group and Private Capital Group represented the seller. The property sits at 1615, 1625 at 1690 S. Congress Avenue in Delray Beach and is currently 45% occupied with major tenants including Alfred Angelo, Sperry & Hutchinson, Twin-Star International and Escalate.

RexxHall’s Aaron Stauber told the Business Journal that the company thinks South Florida has matured significantly in the last two decades. The Arbors is a great opportunity because each of the buildings is different, and each has potential that has not been maximized, he said.

"RexxHall has significant opportunity for upside potential through the lease-up of the vacant space, which they are confident that they will be able to accomplish," said CBRE Vice Chairman Christian Lee in a statement. "They have a big capital budget and plan to renovate the buildings and implement an aggressive leasing program."

For more news and information visit Blumberg Capital Partners.

Thursday, December 1, 2011

CIM Group Sells Hollywood HQ to Hudson Pacific

Hudson Pacific Properties announced this month that it had purchased 6922 Hollywood Boulevard in Hollywood, California from CIM Group for $92.5 million, or $450 per square foot. Sean Sullivan of Eastdil Secured negotiated for the seller and Bob Safai with Madison Partners represented the buyer.

"We are excited to add this highly regarded property to our growing portfolio of quality office assets," said Victor J. Coleman, Chairman and Chief Executive Officer of Hudson Pacific Properties, Inc. "This transaction marks our fourth Hollywood property and seventh acquisition in the last twelve months, as we build on the burgeoning presence of the media and entertainment industries in this submarket."

Commonly known as the TV Guide Hollywood Center and headquarters for CIM's corporate operations, the 12-story 205,522-square-foot office building is fully leased to a mix of media and entertainment tenants including Trailer Park, a movie trailer post-production studio and advertising agency, and J2 Global Communications, the owner of the eFax and KeepItSafe brands according to a CoStar report.

For more news and information visit Blumberg Capital Partners.

Wednesday, November 30, 2011

JV Developing $3.15B Mixed Use Project in China

CapitaLand Limited announced this week that its plans had been accepted by the Chongqing Government in China to develop a 817,000 square-meter mixed use development that will cost 6,536 million yuan (or US$3.15 billion). The project is being developed by a joint venture between CapitaLand, CapitaMalls Asia Limited, and Singbridge Holdings and will comprise residential, retail, office and hotel properties. Acccording to a Wall Street Journal report, the project—to be built over five years—will be funded with debt and equity. Including the land, the total development cost of the project is expected to be about 21.1 billion yuan (about $4.1 billion).

"The availability of credit is still there but it has gotten a little bit more expensive," CapitaLand Chief Financial Officer Arthur Lang said. "In the past, we would have gotten probably a 10% discount to the [People's Bank of China] reference rate; now we're getting probably a 10% premium to PBOC."

Designed by architect Moshe Safdie, the development’s design inspiration took the form of "powerful sails upon the river, symbolising a great city surging forward". The development will be linked to the key districts of Jiangbei and Nan’an by bridges, which are expected to be completed around 2013.

For more news and information visit Blumberg Capital Partners.

Tuesday, November 29, 2011

Cousins Picks up Promenade II in Atlanta for $134.7M

Cousins Properties announced this week that it had completed the acquisition of Promenade II in Atlanta, GA for $133.7 million in cash. Cousins bought the property from Charter Hall Office REIT. According to a CoStar report, Eastdil Secured and Jones Lang LaSalle handled the transaction for the seller.

The 774,000 square foot Class-A office building, located in the Midtown submarket, was 58% leased at the time of purchase with major tenants including Smith, Gambrell & Russell LLP and McGuireWoods LLP. "Promenade Two provides us with a unique opportunity to acquire a trophy asset well below replacement cost and with the potential for exceptional value creation," said Larry Gellerstedt, President and Chief Executive Officer of Cousins. "We now have a trophy offering in all three urban submarkets along the Peachtree Corridor, furthering our strategic goal of upgrading the portfolio as we recycle out of older, stabilized assets."

For more news and information visit Blumberg Capital Partners.

Monday, November 28, 2011

Watergate Building Sold for $76M

Penzance purchased one of two Watergate office buildings in Washington, DC for $76 million according to a CoStar report. Capri Capital Partners finalized the sale of the building at 2600 Virginia Avenue, NW for nearly $287 per square foot. According to the report, a group of investors led by BentleyForbes purchased the structure in 2005 for $86.5 million. Capri recently took over its management.

"The iconic Watergate office building and retail plaza, with its prime location in Foggy Bottom, has Potomac River frontage, proximity to the Kennedy Center, Georgetown and downtown," said Penzance Managing Partner and Co-Founder, Victor K. Tolkan. "Penzance will be applying a broad array of value enhancement strategies and an intense focus on day-to-day operations in order to reposition and revitalize this property. We are thrilled to have the opportunity to own and manage 2600 Virginia Avenue, which will once again become known for its architecture, amenities and its prime location in the Washington landscape."

Penzance's plans include marketing and leasing the vacant office space, 80,000 contiguous square feet of which is located on the top floors of the building. Penzance will manage both the office building and the retail plaza.

For more news and information visit Blumberg Capital Partners.

Friday, November 25, 2011

World Trade Center Retail Taking Shape

A new article from The Achitect's Newspaper takes a closer look at the growth at World Trade Center, focusing on the retail plans for the neighborhood that will include the introduction of more than 635,000 square feet of retail space. According to the article, three new shopping centers are rising in the area that will be connected via underground transit hubs and pedestrian walkways.

The largest complex is being developed by Westfield Group which will be responsible for all retail at the World Trade Center, adding 365,000 square feet of retail space. The company has said it expects to finalize an agreement with the Port Authority by the end of the year. In its third quarter financial update this month, Westfield explained that the company had reached an "in principle agreement on the $1.3 billion joint venture" [with the Port Authority] of the retail premises at the World Trade Center in New York. Westfield invested in the retail concourse at the original World Trade Center six weeks before it was destroyed in the Sept. 11, 2001, attacks, and sold its stake back to the Port Authority in December 2003.

Brookfield Properties is revamping 200,000 square feet at the World Financial Center, a $250 million investment to update the Cesar Pelli designed property and introduce new retail aimed at a fashion or luxury tenant. The plans for the property were originally announced in June declaring that construction was set to begin in October 2011 and would conclude in 2013. The broad-scope changes expand the retail offerings and include high-end fashion, a European-style marketplace, and waterfront dining. In addition, a dramatic glass pavilion on West Street will link the Center to Lower Manhattan’s new transit hubs and serve as the main entranceway to the eight-million-square-foot complex.

In late October, the MTA announced it would lease 70,000 square feet of retail at the $1.4 billion Fulton Street Transit Center to a single operator who will manage and rent out the space.

For more news and information visit Blumberg Capital Partners.

Wednesday, November 23, 2011

Toll Brothwers Acquires CamWest Development

Toll Brothers Inc., a premier builder of luxury homes, has purchased CamWest Development, one of the largest privately held home building companies in the Pacific Northwest. The undisclosed purchased price was paid in cash. Zelman Partners LLC acted as exclusive financial advisor to CamWest.

According to a Wall Street Journal report, Toll ended its fiscal year with more than $1 billion, allowing it to focus on growth at a time when some competitors are pinching pennies as they struggle to survive. It has purchased partially finished golf courses out of foreclosure for development and made money snapping up distressed debt via its Gibraltar Capital & Asset Management subsidiary.

Douglas C. Yearley, Jr., Toll Brothers' chief executive officer, stated: "We are excited to enter the Seattle market with the acquisition of CamWest. It is one of the premier luxury homebuilders in the region with a long history of delivering exceptional quality and value to its homeowners. Seattle is a high barrier-to-entry home building market with a robust employment base and a concentration of affluence. Eric Campbell and the CamWest team provide a great management platform with a strong land position and well-established relationships with local land sellers and subcontractors."

For more news and information visit Blumberg Capital Partners.

Tuesday, November 22, 2011

Energy Square in Dallas Sold to JV

Younan Properties announced this week that it had completed the sale of Energy Square in Dallas, Texas for an undisclosed amount. Real estate sources previously said that Energy Square could trade north of $100 million according to a Dallas Business Journal article. The property was acquired by Champion and Lincoln Property Company in a joint venture with Long Wharf Real Estate Partners. Jones Lang LaSalle's Capital Markets team of Evan Stone, Jack Crews and John Alvarado represented Younan in the sales transaction.

Energy Square is a three building Class A office complex built in 1974, 1980 and 1986 with major tenants including Davaco, Homecare Homebase, Reeder Energy, Hartline Dacus Dreyer, New York Life and Jacobs Engineering. The complex covers 953,622 square feet of office space in the North Central Expressway submarket of Dallas and has an average occupancy of 82%.

"There's plans to do a good deal of capital improvements," said Michael Elizondo, executive managing director at Long Wharf. "We're solidifying our ownership and we plan to bring capital to the table."

For more news and information visit Blumberg Capital Partners.

Monday, November 21, 2011

The Move for Bike Rooms in NYC Office Buildings

An article from the New York Times, A Room of Their Own for 2-Wheeled Commuters, examines the recent move by some building landlords to establish bicycle rooms for their tenants, and the related benefits and limits of offering the ammenity. The article used 345 Hudson Street in New York as an example, where the property manager says that the bike room they built in its storage space in 2008 is "always packed". "We have 35, 40 bicycles there a day," said Alfonse Amore, vice president for property management for the building's landlord, Trinity Real Estate.

Regulations established by the New York City Department of Transportation on December 11, 2009 requires commercial office buildings with at least one freight elevator to implement and post a Bicycle Access Plan that allows the tenant's employees to bring bikes into the tenant's office space. "The law doesn't require bike rooms," explained Noah Budnick, the deputy director of the nonprofit Transportation Alternatives. "The law just requires that the buildings let the people get their bikes from the street to their office. We're hearing more and more that this is a selling point for the real estate industry. You're seeing office spaces marketed with bike rooms, which is pretty awesome."

But, notes the article, one thing may be preventing landlords from building even more bike rooms: showers. An excerpt:

In new office buildings, the U.S. Green Building Council, which certifies buildings as LEED-compliant, awards points only for bike rooms with showers and changing rooms. And in existing buildings, bike rooms also do not automatically earn LEED points because they are based on behavioral changes in tenants — for instance, if a tenant allows employees to telecommute or if a landlord puts in a bike room that gets heavy use. LEED certification, shorthand for Leadership in Energy and Environmental Design, is important to landlords because it tells the public, and investors, that their buildings save energy.

The building council's requirement that new buildings have showers, which can be costly to install and take up more space, is a sticking point for some New York landlords. While a rinse may be necessary for riders pedaling 10 miles to a suburban office park, landlords say, Manhattan employees coming from, say, Park Slope in Brooklyn, usually won't work up much of a sweat.

"You have a lot of buildings here which would like to get LEED points," said Eric Gural, an executive managing director of Newmark Knight Frank who oversees the 1,000-square-foot bike room at 520 Eighth Avenue. "If we didn't have to put a shower in, I think you'd see a lot more bike rooms that would be provided by landlords."

For more news and information visit Blumberg Capital Partners.

Friday, November 18, 2011

Frisco Square Lands Big Tenant in Gearbox

Gearbox Software LLC signed a 61,000 square foot lease in the new Frisco Square project near the Dallas North Tollway according to a Dallas Business Journal report. Gearbox, currently headquartered off Park Boulevard in Plano, will move its site to the new offices being constructed in Frisco Square that are expected to be completed in Spring 2012. CBRE represented Gearbox in the transaction with Jones Lang LaSalle respresented the landlord and developer, Frisco Square Development.


"This project helps keep the momentum going for Frisco Square," said Jim Leslie, managing partner of Frisco Square Development. "It's one more domino that helps support the growth in that submarket."

Frisco Square is a master planned development which will encompass as much as 4.4 million square feet of office, retail, multi-family and municipal facilities in an area of 147 acres. Located at the intersection of the Dallas North Tollway and Main Street and only 30 minutes from Dallas, Dallas/Ft. Worth International Airport and Dallas Love Field, Frisco Square is similar to a European village; a pedestrian-friendly urban environment in one of the fastest growing cities in Frisco, Texas. The entire project is expected to introduce nearly 300,000 square feet of space to the development, bringing Frisco Square to more than 1 million square feet of mixed-used space.

For more news and information visit Blumberg Capital Partners.

Thursday, November 17, 2011

SL Green Sells One Court Square for $476M

SL Green Realty Corp. announced this month that it and its joint venture partner reached an agreement to sell One Court Square in Long Island city for $476 million, or roughly $340 per square foot, to a consortium of private investors. According to SL Green, which expects to realize $42.8 million in net proceeds from the sale, the transaction includes $315 million of existing debt to be assumed by the purchaser.

The 50 story skyscraper is fully leased to Citigroup Inc. and was originally acquired in part by SL Green in conjunction with its 2007 acquisition of Reckson Associates Realty Corp. The building was completed in 1989 and designed by Skidmore, Owings & Merrill.

SL Green also recently formed a joint venture with owner Joseph Moinian to refinance debt on the AIG Headquarters in lower Manhattan, purchasing a a 49.9% stake in 180 Maiden Lane according to a Businessweek article.

For more news and information visit Blumberg Capital Partners.

Wednesday, November 16, 2011

Cambridge Office Property Sold for $13.6M

An investment fund run by New York-based O’Connor Capital Partners has purchased 70 Fawcett Street in Cambridge, Mass. for $13.6 million according to a Boston Business Journal article. New Boston Fund originally acquired 70 Fawcett Street through its Fund VI in two phases. In 2003, Level 3 Communications sold New Boston the 4.9 acres of land and its interest in a ground lease. In 2005, New Boston then acquired the leasehold interest which included the 141,000-square-foot building.

"The sale of 70 Fawcett Street to O’Connor Capital Partners aligns perfectly with our disposition strategy," said Tim Medlock, President of New Boston Fund. "We felt it was an appropriate time to sell this property and we are confident that it will provide the perfect site for their planned residential development."

The sale was negotiated between New Boston Fund and Cabot, Cabot & Forbes on behalf of the buyer.

For more news and information visit Blumberg Capital Partners.

Tuesday, November 15, 2011

Flatiron Park Complex Sold for $60.8M

Goff Capital Partners completed the purchase of a 19 building office complex in Boulder, Colorado from the Flatiron Park Co. for $60.75 million, or $99 per square foot, according to a CoStar report. Flatiron Park Co. built, owned and managed the park, a complex built in stages between the 1970s and the late 1990s.

"It was never on the market. It was a situation where we knew some of the folks, and they had expressed some interest," Flatiron Park Co. Vice President and General Manager Dick Hedges said in a Boulder County Business Report article. "We're very happy these are the guys that bought the property," Hedges said. "They've indicated they're going to run the park as we have in the past, and they've taken on a number of our employees, which we're very happy about. There will be continuity."

NewOptions Partners represented Flatiron Park Co. in the transaction. Goff Capital is expected to redevelop and reinvest in some of the properties, according to information provided by Hedges and Scott Garel, a senior vice president with Grubb & Ellis Co., which oversees leasing of the properties.

For more news and information visit Blumberg Capital Partners.

Monday, November 14, 2011

CityWest Office Tower Sold

An affiliate of Thomas Properties Group, TPG/CalSTRS, LLC, announced the sale this week of 2500 CityWest Boulevard in Houston, Texas for an undisclosed price to a private party. The 578,284 square foot office tower, designed by Sikes, Jennings & Kelly, was sold along with two adjacent unused land parcels totaling 6.3 acres.

"The closing of this transaction represents another significant step in executing our strategic plan, which includes pruning our portfolio of certain joint venture investments that have been repositioned and stabilized, and reducing our land holdings," said Jim Thomas, Chairman and CEO of Thomas Properties Group. "2500 CityWest is a property that we have successfully repositioned and stabilized. We are pursuing a number of attractive opportunities for the investment of these sales proceeds. We remain committed to Houston as a long-term strategic investment market based on its compelling economic and job growth drivers."

For more news and information visit Blumberg Capital Partners.

Friday, November 11, 2011

NAR Expects CRE Market to Improve in Year Ahead

The National Association of Realtors held its Economic Issues and Commercial Real Estate Business Trends Forum at the 2011 Realtors© Conference & Expo this month exploring the conditions in real estate and particularly the commercial real estate industry in tandem with the nation's economic recovery. Chief Economist Lawrence Yun shared his predictions for the commercial real estate market in 2012 and 2013, anticipating a steady improvement in commercial real estate markets. Yun was joined by Kenneth Riggs, president and chairman of Real Estate Research Corporation (RERC) and chief real estate economist of the CCIM Institute, and Robert White, founder and president of Real Capital Analytics, who shared his outlook for slight improvements in commercial real estate markets in the year ahead.

"I anticipate a small recovery in the next year in home values, which would help small business owners; however, that's only if legislators and regulations don't add obstacles to hinder the housing market recovery, such as modifying or eliminating the mortgage interest deduction or increasing down payment requirements," said Yun. He predicted moderate improvements in commercial real estate markets and the broad economy because job growth and other economic factors are slowly improving. He said that despite the stock market's volatility, it is performing higher than it was in 2008, making it easier for companies to raise capital and for consumers to gain wealth. Yun doesn't anticipate a second economic recession in the near term, because of the strong cash potential that businesses could release into economy, which would help the country avoid a second recession. He said that international trade is expanding and that international home buyers are taking advantage of the weaker dollar and investing in commercial and residential real estate.

For more news and information visit Blumberg Capital Partners.

Thursday, November 10, 2011

Bloomington Southgate Office Tower Surrendered to Lender

American International Group (AIG) will be taking back the Southgate office tower in Bloomington in a highly unpublicized transaction. According to a Minneapolis/St. Paul Business Journal report, the New York-based lender provided funds for the property to Welsh Companies, which is not preparing to give the office property back.

While no official statements have been released from the companies, a letter from the Minneapolish office of Transwestern was delivered to tenants of the property on October 28 notifying them of the ownership change. One of the tenants described the letter to the Journal and explained that Transwestern was expected to take over building management on November 15, a contract formerly handled by Welsh through its unit known as Colliers International | Minneapolis-St. Paul.

For more news and information visit Blumberg Capital Partners.

Wednesday, November 9, 2011

Wells Fargo Establishes New REIT Finance Group

Wells Fargo & Company announced this week that it had formed the REIT Finance Group, a team of professionals from within Wells Fargo dedicated to serving publicly-traded REITs in the CRE industry. Acorrding to a Washington Business Journal article, the new group will provide corporate banking services, lines of credit, term loans and construction loans to REITs while also working with Eastdil Secured LLC, a Wells Fargo subsidiary, for real estate investment banking services, and with Wells Fargo Securities for capital markets needs.

Rex Rudy, based in Charlotte and formerly Managing Director of Real Estate Syndicated Finance at Wells Fargo Securities, has been appointed as Managing Director and head of the REIT Finance Group. Rudy will report to Chip Fedalen, executive vice president and head of the Wells Fargo Commercial Real Estate Institutional and Metro Markets Group.

"Rex has devoted his career to the REIT industry and I know his wealth of experience and widely-respected reputation will be beneficial to our clients," said Fedalen. "This new team will further enhance our ability to provide our broad platform of commercial real estate products and services to REITs."

"The REITs have held up amazingly well and clearly have an access to capital that most private clients don't have today," said Rudy in a REIT.com article. "But, like everyone else, the economic environment has had an impact on all of these properties, so we are all hoping for a more robust economic recovery."

For more news and information visit Blumberg Capital Partners.

Tuesday, November 8, 2011

Cedar Bend Professional Center in Austin Breaks Ground

Cedar Bend Professional CenterLive Oak-Gottesman broke ground recently on a new 70,000 square foot medical office building in Austin according to an Austin Business Journal article. Live Oak-Gottesman is developing the property along with Rooker & Associates, which will also serve as the general contractor on the project, which is expected to be completed by the third quarter of next year.

Adjacent to St. David's North Austin Medical Center in the heart of North Austin's medical center corridor, Cedar Bend Professional Center offers access to the hospital, high parking ratios with covered physician parking. Cedar Bend is located less than two miles from the Domain offering a high volume of restaurants and retailer options. The property is 90% pre-leased to tenants including the General Services Administration, Capital Otolaryngology, Head & Neck Surgeons, Nasal & Sinus Center of Austin, Renu Austin and Snoring Austin.

For more news and information visit Blumberg Capital Partners.

Monday, November 7, 2011

Sabal Acquires $385M Loan Portfolio

Sabal Financial Group announced at the end of last month that it had acquired a $385 million portfolio of loans from the from the Federal Deposit Insurance Corp. (FDIC) according to a National Real Estate Investor article. The portfolio includes performing and non-performing loans, a sale mandated by the FDIC for the assets of 42 failed banking institutions. The portfolio is secured by properties across the United States with the largest concentration in the southeast and Midwest.

"This is our third FDIC transaction and it brings our total number of assets under management to approximately $3 billion," said R. Patterson Jackson, Chief Executive Officer of Sabal Financial Group. "Sabal is uniquely qualified to oversee the management and work out of small balance distressed assets of this type with a model that is scalable to handle portfolios of this magnitude."

For more news and information visit Blumberg Capital Partners.

Friday, November 4, 2011

Concord Corporate Centre Sold by Transwestern

Transwestern Investment Company sold a two-building Class A office campus in Concord, California to Westcore Properties for an undisclosed sum this month according to a CoStar report. Westcore Properties was represented by Waveland Financial in the transcation. The 346,747 sqaure foot Concord Corporate Centre previously sold for $99 million in July 2007 when Transwestern acquired the property from Blackstone.

"Concord Corporate Centre is one of the top office projects in Concord and offers flexible and efficient floor plates, due to a center core configuration, that are ideal for smaller tenants," said Neil Johnson, managing director of acquisitions with Westcore Properties' Northern California office. "Westcore Properties recognized the opportunity to secure a Class A asset in a submarket that appears to be rebounding with 54,613 square feet of positive net absorption being reported for the quarter."

Major tenants of Concord Corporate Centre, located just 31 miles east of San Francisco in Contra Costa County, include Pacific Bell Directory, Eichleay Engineers, SeaBright Insurance Company and Gregory B. Bragg & Associates. Cornish and Carey Commercial will reportedly continue to be responsible for the leasing at the property.

For more news and information visit Blumberg Capital Partners.

Thursday, November 3, 2011

Wells Fargo Buying $3.3B in Loans

Irish Bank Resolution Corporation, formerly Anglo Irish Bank, has agreed to sell a portfolio of 61 performing loans worth $3.3 billion to Wells Fargo & Co. according to an Orlando Business Journal article. Wells Fargo said it closed on 25 of the loans, with a face value of $1.5 billion, last week and expects the balance of the loans to close in the fourth quarter.

Wells Fargo is Central Florida's third-largest bank, with 59 branches and $5.9 billion in deposits. Wells Fargo and Royal Bank of Scotland Group Plc also sold about $1 billion of bonds backed by commercial mortgages after relative yields on the debt fell reported Businessweek at the beginning of the month.

For more news and information visit Blumberg Capital Partners.

Wednesday, November 2, 2011

Goldman Sachs Buys VA Portfolio for $438M

Goldman Sachs Group was announced last week as the buyer of a nonbankrupt unit of Lehman Brothers Holdings Inc.'s stake in a ten office building portfolio in Virginia, paying Lehman a reported $438 million for its stake in the properties according to a Bloomberg report.

Separately, Lehman filed court papers on Monday announcing it had settled a lawsuit accusing Goldman of using pretextual excuses to avoid closing on the deal earlier in October. "This transaction is another example of our executing the sale strategy we laid out at the beginning of the year and has enabled us to achieve a strong result for our creditors," Jeff Fitts, who heads Lehman's real estate group, said in the statement.

Lehman Brothers filed the biggest bankruptcy in U.S. history in September 2008, listing assets of $639 billion. Lehman's reported share of the investment in the portfolio that traded hands with Goldman was $206 million with its partners' share at $56.5 million.

For more news and information visit Blumberg Capital Partners.

Tuesday, November 1, 2011

Newport Tower Sold for Landmark $377.5M Pricetag

Brookfield Office Properties announced that it had successfully sold the Newport Tower office building in Jersey City, New Jersey for $377.5 million, making it the largest single office asset transaction in New Jersey history. Multi-Employer Property Trust (MEPT) bought the 36-story, 1.1-million-square-foot office building with advisement from Bentall Kennedy; CB Richard Ellis represented Brookfield in the transaction.

"This was the optimal time to monetize this mature asset, having achieved opportunistic returns for us and our fund partners," said Dennis Friedrich, president and global chief investment officer of Brookfield Office Properties. "During our six-year period of ownership and management, we were able to successfully lease-up, stabilize, and incorporate sustainable strategies in the building to significantly increase value."

Brookfield originally acquired the building as part of a $7.6 billion purchase of Trizec in 2006. The building was reportedly 89% leased at the time of sale with major tenants including BNP Paribas and AXA Equitable.

For more news and information visit Blumberg Capital Partners.

Monday, October 31, 2011

One57 Tower Gets $700M Loan

Extell Development Co. closed a $700 million construction loan from Bank of America-led syndicate consisting of funds from Bank of America, Banco Santander S.A., Abu Dhabi International Bank, Capital One and the Bank of Nova Scotia for its massive mixed-use development at 157 West 57th Street, One57 Tower. According to a CoStar report, Bank of America will serve as administrative agent for the loan financing a portion of the project.

"It's a significant commitment from a major lender," said a spokesperson. "It shows the confidence [Bank of America] has in this development."

One57 is a new 90-story condo tower project that began selling units earlier this month; Extell is asking up to $4,000 per square foot for one-bedrooms; up to $4,150 per square foot for two bedrooms; up to $6,580 per square foot for three bedrooms; and up to $8,413 per square foot for four bedrooms, according to a copy of the Schedule A provided to The Real Deal.

For more news and information visit Blumberg Capital Partners.

Friday, October 28, 2011

Two Grand Central Tower Sold for $401M

Two Grand Central Tower in New York, which went to market in June of this year expecting a sale price of $370 million, sold this month for $401 million according to a National Real Estate Investor article. The tower was sold by a joint venture between Boston Properties, Goldman Sachs and Meraas Capital, which is controlled by Dubai's ruler, Sheikh Mohammed bin Rashid. The unnamed buyer assumed $176.6 million of mortgage indebtedness according to the REIT.

The 667,000-square-foot building at 140 E. 45th St. was developed in 1982 and later sold by Harry Macklowe. The joint venture originally purchased the property in 2008 from affiliates of Macklowe Properties as part of a $705 million deal that also included 540 Madison Avenue in New York City.

During an Earnings Call, Boston Properties' Douglas T. Linde commented on the sale of the property saying:

"The office mark-to-market is still getting stronger, about a positive $1.41 per square foot. It was nice to be able to announce today in our supplemental aspect that we actually closed our sale of Two Grand Central. I would say I was a little gun-shy, given what our experience was with the New Jersey sale or lack of sales for the last couple of quarters. But we sold the building for $400 million, $617,000 a square foot. And if you look at the supplemental information for the third quarter on an annualized basis, the income is $13.9 million. But the building, again, is only 74% leased. So you can do the math and figure out what the conical cap rate is if you want to think about things in that way.

The sale of this asset was really always a possibility ever since the initial acquisition. To be truthful, and I think a lot of you acknowledged this and commented to us, the building has a very different market position and leasing profile than the other portions of our New York City portfolio. And was distinct enough from that portfolio, that we just came to the conclusion that there was very little synergy to owning the building. And so we sold it when the time was right."

For more news and information visit Blumberg Capital Partners.

Thursday, October 27, 2011

2012 Outlook Shows Slow, "Grind-It-Out" CRE Recovery

PricewaterhouseCooper (PwC) and the Urban Land Institute (ULI) released the Emerging Trends in Real Estate 2012 survey and forecast. The report predicts a "slowing, grind-it-out economic recovery" following a period of mostly sporadic growth, confined largely to a few real estate markets. Survey participants predict that 2012 will see an increased supply of properties for sale; however, due to economic uncertainty, interest among buyers may diminish.

"Job creation is clearly the critical ingredient for a sustained recovery in commercial real estate and the market participants we surveyed uniformly struggled to identify new employment engines. As a result, businesses are focused on squeezing profitability out of productivity gains, and families forced into belt-tightening are using less square footage, which follows ‘The Era of Less' sentiment we forecast last year," said Mitch Roschelle, partner, U.S. real estate advisory practice leader, PwC. "In 2012, investors expect pricing to level off in the top markets – and overall ‘buy' sentiment will subside, selling appetites will increase, and more owners will hold until the economy untracks. This is part of 'the new normal' as investors are coming to grips that they may not be selling for more than they paid."

For more news and information visit Blumberg Capital Partners.

Wednesday, October 26, 2011

Inland Real Estate Acquisitions Inc. announced this month that it had purchased a five property portfolio of retail buildings from NewQuest Properties on behalf of Inland American Real Estate Trust, Inc. Inland acquired the portfolio for $172 million with financing provided by Prudential Mortgage Capital Company.

"This portfolio is a natural complement to our current properties in the region," said Jeff Manno, vice president of asset management for Inland American HOLDCO. "These necessity-based shopping centers are the type of core real estate assets that fit our retail investment strategy. We believe this transaction will enhance our portfolio and be accretive to our earnings."

The properties cover over 710,000 square feet of retail space with an average occupancy rate of over 90%. Major tenants at the time of sale include Kohl's, Kroger, Lowe's, Sports Authority, 24 Hour Fitness, Best Buy, Cinemark and Dollar Tree.

For more news and information visit Blumberg Capital Partners.

Tuesday, October 25, 2011

Moody's CPPI Up 2.4% in August

The latest Moody's/REAL Commercial Property Price Indices report for October 2011 was released this week recording a 2.4% increase in August for the National — All Property Type Aggregate Index (CPPI), bringing it to 15.3% above the post-peak low recorded in April 2011. An excerpt from the report:

The share of distressed transactions included within this month's CPPI was 21.7%, down 5.9% from last month and the lowest level since January 2010. Prices for distressed transactions were down by 3.5% from the last month and are 6.9% above their post peak low set in August 2010. The reduced share of distressed transactions helped drive this month's overall price increase.

Looking forward, we do not envision significant price increases over the next year. While distressed transactions should be at or near their high water mark for this cycle, there is less CMBS loan origination to help support acquisition pricing, especially beyond the portfolio lender sweet spot of trophy properties and top tier markets.

"There's more caution," Robert Bach, chief economist for Grubb & Ellis Co., a Santa Ana, California-based brokerage, said in a telephone interview with Businessweek before the Moody's report was released. "Investors in general are a little more cautious, and that includes investors in commercial real estate."

For more news and information visit Blumberg Capital Partners.

Monday, October 24, 2011

$1.8B London Loan Portfolio Sold

Kennedy Wilson, an international real estate investment and services company headquartered in Beverly Hills, CA, announced this week that it had entered into an agreement to purchase a loan portfolio from Bank of Ireland for $1.8 billion according to a Bloomberg report. "The biggest opportunities are in Europe," said Chief Executive Officer William McMorrow in a telephone interview. "The U.S. banks have all raised capital and they're not under as much pressure right now to sell assets." The purchase will close in two phases, with $1.4 billion completed on Friday, October 21 and an additional $400 million expected to close at the end of November.

Mary Ricks, executive vice chair of Kennedy Wilson, said of the deal that the "Kennedy Wilson team did an excellent job on this complex transaction, and we believe that this closing will serve as a base for the company's further expansion in Europe."

About 70% of the loans are secured on office, apartment and retail properties in London reported The Irish Times. Bank of Ireland disclosed the transaction when it announced earlier this month that it had deleveraged the bank by disposing of about €5 billion of loans – half of it non-core loans – at a discount of 9% on their face value.

For more news and information visit Blumberg Capital Partners.

Friday, October 21, 2011

KS Partners Buys Building from New Boston Fund

33 Boston Post RoadKS Partners announced this month that is had successfully acquired 33 Boston Post Road in Marlborough, MA for $8.15 million from New Boston Fund according to a Boston Business Journal article. The purchase price reflects a value of $72 per square foot on the 6-story, 113,050 foot office buiding. Avidia Bank, a community bank based in Hudson MA, provided the acquisition financing and a funding facility for future capital improvements & leasing costs. The property was last purchased in 2000 for $12 million.

33 Boston Post Road , at the intersection of Boston Post Road and Northboro Road just west of the intersection of Route 495 and Route 20, was constructed in 1986 and caters to small to medium-sized tenants. The property is supported by strong retail, restaurant and hotel amenities, along with on-site amenities including a cafe and fitness center. The property also includes two annex buildings totaling 6,702 square feet. The building is currently 70% leased with major tenants including ECC, BayPath, Forefield and the Law Offices of Gary H. Kreppel.

"What we're seeing in the market is small-tenant growth," said Richard M. Griffin, senior vice president and director of investments at KS Partners. Most are companies already in the market that "are in need of expansion space," he said.

For more news and information visit Blumberg Capital Partners.

Thursday, October 20, 2011

Office Market Shows Strong 3Q Absorption

A new market report from CoStar shows that continued strong leasing activity, coupled with barely any new construction, could lead to office rent increases in some U.S. office markets. The report notes that the U.S. office market absorbed 19 million square feet in the third quarter of this year according to data presented at CoStar Group's Third-Quarter 2011 Office Review & Outlook. An excerpt from the report.

The leasing activity helped lower the national office vacancy rate slightly to about 13.1% -- down nearly a half percentage point since hitting its peak a year ago. Should leasing activity remain at the level seen this past quarter, it would set the stage for future rent increases, since little to no new supply is being added. CoStar's analysis found office rents firming or already trending up in some key metros, and more increases are expected to spread across the country by 2013.

Leasing activity, which bottomed out in early 2009, increased in the third quarter as tenants signed long-term commitments to lock in low rents for higher-quality Class A and B buildings. Gross leasing is now approaching levels not seen since the first Internet company boom a decade ago.

The San Francisco Bay area, which has seen some of the most heavily discounted rental rates among office markets, led the country with 4.4 million square feet of net absorption in the third quarter. Similar net absorption strength was found in markets with heavy presence of technology and energy firms. The top five metros for absorption included Seattle/Puget Sound (2.5 million square feet absorbed) Boston (2.1 million square feet), Philadelphia (1.9 million), Houston (1.9 million) and Washington, D.C. (1.7 million). Northern New Jersey led a handful of markets that experienced negative absorption, also including Atlanta, Los Angeles, Westchester/So Connecticut, and Minneapolis.

For more news and information visit Blumberg Capital Partners.

$150M Constitution Square Project Breaks Ground

StonebridgeCarras broke ground this week on a new 345,000 square foot spec office building in Washington, DC at 3 Constitution Square according to a Washington Business Journal article. 3 Constitution Square, a $150 million investment, is speculative only in a technical sense explained Douglas Firstenberg, founding principal of Bethesda-based StonebridgeCarras; while the property has yet to sign on any tenants, Firstenberg is concerned with whether the building will go federal or private. "We think it's going to be a fun competition to see which it is," Firstenberg told the told the Journal. "Obviously our view is there's little development going on right now, and we're pretty excited about a project delivery in late 2013." Cassidy Turley has been retained to market the space.

The initial build phase of the complete Constitution Square project will comprise 1.6 million square feet including two Class A, LEED Gold Certified office buildings, 440 luxury apartment units, a new 50,000 square foot full service Harris Teeter grocery store and a 204 key Hilton Garden Inn. The site, master planned as a 2.5 million square foot, transit oriented, mixed-use development, encompasses an entire city block between 1st and 2nd and M and N Streets, N.E. and is designed as a model for integrated, mixed-use development. Constitution Square has partnered with NoMa's Business Improvement District and the D.C. Office of Planning to achieve designation of the area as one of the pilot programs areas for "LEED for Neighborhoods."

For more news and information visit Blumberg Capital Partners.

Wednesday, October 19, 2011

Crescent Sells 6 Properties to JPMorgan

Crescent Real Estate Holdings completed a transaction at the end of last month that didn't make many headlines but gave its stake in six Texas office properties to its partner, a unit of JPMorgan Chase & Co., according to a Fox Business News article. The properties are valued at about $2 billion and include The Crescent, a 1,134,826 square foot office and retail complex in Dallas, and Houston Center, a major mixed-use urban real estate development covering four buildings and almost 4.5 million square feet of Class A office space.

Crescent, owned in a joint venture between Barclays Capital and Goff Capital, originally bought into the portfolio in 2009 for an undisclosed sum. Details of the current sale were not disclosed, but it's reported that Crescent will continue to operate the properties for its former JPMorgan partners. The total value of the Texas properties in the deal is approximately $1.85 billion, which means the value of Crescent’s stake was about $444 million according to a Houston Business Journal article.

For more news and information visit Blumberg Capital Partners.