JV Investing up to £200M in London's West End

A joint venture between Grosvenor Fund Management and the Canada Pension Plan Investment Board (CPPIB) has formed this summer to invest up to £200 million in London's West End office market over the next two years according to a Benefits Canada article. Grosvenor will invest £10 million and lead asset sourcing and management activities while CPPIB will invest the remaining £190 million.

Wenzel Hoberg, Canada Pension Plan Investment Board's managing director and head of European real estate investments, said, "This venture with Grosvenor Fund Management provides us with an entry into an attractive, niche commercial real estate market in West End London. This investment aligns with our existing European real estate investment strategy and introduces us to a well-respected partner in Grosvenor Fund Management, which has a unique knowledge of the West End office market and strong active management and refurbishment expertise."

Mervyn Howard, Director Grosvenor Fund Management, said: "We are delighted to have formed this venture with CPPIB who share our belief in the future strength of the central London office market. Grosvenor and Grosvenor Fund Management have been active in the London office market through many cycles. We have the in-house skills to execute the strategy of the Partnership and believe the timing is right."

For more news and information visit Blumberg Capital Partners.

Wal-Mart Buys Leased Property for $104.5M

Wal-Mart Corp. has acquired the 4 million square foot distribution center it's been leasing since 2005 from the Texas Permanent School Fund for $104.5 million according to a CoStar report. The Baytown property was built in 2004 and originally sold shortly after completion by Wal-Mart to the state's General Land Office, which invests in real estate property for the Permanent School Fund. The state reportedly has made more than $40 million on the deal in rent and proceeds.

According to CoStar the deal totals 4 million square feet and includes two industrial buildings at 4554 E. Greenwood Road in Baytown. The property is on a 473-acre tract in Chambers County, about 14 miles from the Houston Ship Channel.

For more news and information visit Blumberg Capital Partners.

New Development Planned at Bosch-Hogg Building Site in Austin

Developers in Austin have applied for a zoning change at the 800 block of Congress Avenue in Austin to pursue a boutique hotel with 120,000 square feet of office space according to an article from The Statesmen. The project would occupy the land currently taken by the Bosch-Hogg Building which was originally built in 1897 as a three story building with three additional floors added to the structure in 1984. Austin developer David Kahn, managing partner of Colina West Limited, plans to build a 28 story mixed use property in its place but will need the zoning change to allow for a larger building than is currently permitted for that site.

"I saw an opportunity to bring some excitement and energy to that part of downtown," said Kahn. He also explained that while financing for his project is not in place, he expects to fund it with local investors and bank financing.

"The downtown Austin hotel market is one of the strongest in the state, which should be able to support more hotel rooms," said Randy McCaslin, vice president in the Houston office of PKF, a hotel industry research and consulting firm. "However, there are a lot of hotel projects in various stages of planning, so a lot will depend on who gets financing first."

For more news and information visit Blumberg Capital Partners.

Fort Lauderdale's One Financial Plaza Sold for $44M

One Financial Plaza in Fort Lauderdale was sold to a joint venture between Crocker Partners and Westcity Realty for $44 million according to a Sun Sentinel article. The price is a 25% discount on the $58.7 million mortgage; in June 2009 the previous owner, One Financial Center LLC, agreed to a $64.2 million foreclosure judgement on the property. The developer had originally purchased the property for $65 million in 2007.

The 28 story property at 100 SE Third Ave. is home to the Tower Club and Regions Bank. At the time of sale the 236,000 square foot building was roughly 80% leased. One Financial Plaza was initially opened in 1972 and in 2009 construction was completed to rebuild a storm-grade curtain wall and modernize the facade in accordance with post-Hurricane Andrew building codes.

For more news and information visit Blumberg Capital Partners.

Jayna Purchases Trinity Square Business Park

Jayna Inc. is expanding into the Dallas Fort Worth area with the purchase of Trinity Square Business Park at 2555 Tarpley Road in Carrollton. Ohio-based Jayna bought the complex on nearly 1.9 acres of land for an undisclosed amount with plans to open a business at the 32,480-square-foot office and warehouse property. Cushman & Wakefield represented Jayna in the transaction with Bradford Commercial Real Estate Services representing the Cleveland-based seller, PAI Dallas.

"The third quarter is typically the slowest quarter in Texas," Jean Russo of Cushman & Wakefield said in a D Magazine article. "Boards don't meet in the late summer, everybody's on vacation, and it's hot, so new companies that are in the market typically wait until after Labor Day."

For more news and information visit Blumberg Capital Partners.

STAG Picks Up Two Properties for $17.9M

STAG Industrial, Inc. announced this week that it had acquired two industrial properties for $17.9 million according to a Dallas Business Journal article. STAG also closed a $65 million acquisition mortage facility with Connecticut General Life Insurance Company which will be used to fund future acquisitions.

The first building at 1801 Riverbend West Drive in Fort Worth, Texas was built in 1997, renovated in 1999, and is 100% leased to Ecolab, Inc. The second building at 18285 NE Halsey in Gresham, Oregon was originally built in 1960 and last renovated in 2006 and is now leased in part to both Unisource Worldwide and Benson Industries, LLC.

For more news and information visit Blumberg Capital Partners.

LodgeWorks Selling 24 Property Portfolio to Hyatt for $802M

LodgeWorks LP, a private hotel developer, and its private-equity partners has signed an agreement to sell their 24 property portfolio to Hyatt Hotels Corporation for approximately $802 million in cash according to a Bloomberg report. The acquisition includes 24 hotels and related assets, including management, franchise and intellectual property rights; Hyatt indicated that key members of the LodgeWorks management and development teams are expected to join Hyatt.

"We are very proud of our hotels and our teams," said LodgeWorks founder, Chairman and CEO Rolf Ruhfus. "It is exciting to build a portfolio that brings value to our investors and teams and now to an industry-leading Hyatt. We respect the Hyatt heritage and culture and are very pleased to contribute to its growth."

"This is a significant expansion of our presence in the United States and enhances our extended-stay representation with a great collection of high-quality hotels," said Mark Hoplamazian, President and CEO of Hyatt.

For more news and information visit Blumberg Capital Partners.

Millennium Warner Center Trades at $133M

Wesco, a joint venture sponsored by Essex Property Trust, purchased the Millennium Warner Center from developer Warner Center Apartments this month for $132.85 million according to a Los Angeles Times article. The newly built 438-unit Millennium Warner Center apartments feature a mix of units from one to three bedrooms, with common area amenities including two resort-style swimming pools with sun decks as well as a 24-hour health club facility.

"There is tremendous demand for newer, Class A assets in core California markets, and these opportunities are few and far between," broker Stan Jones of Institutional Property Advisors, which represented the seller in the transaction, told the Times. "Given the intense buyer demand and leasing momentum, investors are willing to assume the lease-up."

Ron Harris of Institutional Property Advisors, added that this demand "has also created an environment in which developers are building new ground-up construction again in many Los Angeles neighborhoods, as is evidenced by the number of cranes in view all over the city."

For more news and information visit Blumberg Capital Partners.

Falls Church Corporate Center Towers Sell for $83.7M

Pearlmark Real Estate Partners sold two office towers in the Falls Church Corporate Center of Falls Church, VA for $83.7 million according to a CoStar report. The JBG Companies purchased the properties for $210 per square foot in a deal brokered by Transwestern's DC Institutional Commercial Group.

Located at 6400 & 6402 Arlington Blvd in Falls Church, the Falls Church Corporate Center was reportedly 88% occupied at the time of sale. The property consists of two 13-story office buildings totaling 399,049 square feet and a development site that can accommodate a 200,000 square foot office building. Gerry Trainor, executive managing director of Transwestern, told GlobeSt.com that "JBG's game plan is to lease it up and enjoy the cash flow."

For more news and information visit Blumberg Capital Partners.

Apollo Sells $195M Hotel Portfolio to REIT

Innkeepers USA Trust, a real estate investment trust (REIT) and subsidiary of Apollo Investment Corp., sold a portfolio of hotels to Chatham Lodging Trust for $195 million according to a CoStar report. Chatham acquired the five hotels listed below, which comprise a total of 764 rooms, for approximately $255,000 per room; the purchase nearly doubles Chatham's existing hotel investments. Chatham funded the acquisition through the assumption of five individual mortgage loans, secured by the hotels, totaling $134.2 million, as well as available cash and borrowings under its senior secured revolving credit facility.

- Residence Inn Anaheim, Garden Grove, Calif.

- Residence Inn San Diego, Mission Valley, Calif.

- Residence Inn Tysons Corner, Tysons Corner, Va.

- Doubletree Guest Suites Washington, D.C., Washington, D.C.

- Homewood Suites on the Riverwalk, San Antonio, Texas

The hotels will continue to be managed by Island Hospitality Management, a hotel management company 90% owned by Jeffrey Fisher, Chatham CEO and president.

"These top-tier branded hotels give us a strong presence in some of the country's prime hotel markets," said Fisher.

For more news and information visit Blumberg Capital Partners.

Dune and Ocean Buy Orange County Office Tower for $70M

A partnership between Dune Real Estate Partners and Ocean West Capital Partners has successfully acquired 2600 Michelson in Irvine, CA for $70 million according to a Bloomberg report. The office building was previously owned by MPG Office Trust, the Los Angeles-based landlord formerly known as Maguire Properties.

Russell Gimelstob of Dune Real Estate Partners stated, "We've seen early signs of improvement in the Orange County office market and believe there is significant value in its long-term fundamentals. The structured nature of this transaction highlights the team's ability to capitalize on opportunities at the intersection of the real estate and capital markets."

"2600 Michelson's contiguous upper-floor vacancies, available building-top signage, and 52% occupancy rate – compared to peak rates of 95% in 2007 – present attractive leasing conditions and create a substantial opportunity to re-introduce and reposition the property in the recovering marketplace," said Troy Miller of Ocean West. "We are confident that the combination of Dune's substantial capital markets expertise and Ocean West's prior experience operating and leasing this property will drive value for this investment."

For more news and information visit Blumberg Capital Partners.

Shreveport Chase Tower Gets $12.2M Refinance Loan

Cohen Financial reportedly arranged a $12.2 million loan for the Chase Tower in Shreveport, LA under a 10-year, non-recourse commitment with a 30 year amortization schedule according to a National Real Estate Investor article. The borrower was only named as an Hawaii-based client of Cohen Financial and the lender listed as a regional bank, which is providing the loan at a fixed 5.5% interest rate for the first five years.

"Due to our strong lender relationships, and the fact that the borrower had increased occupancy and the value of the property, Cohen Financial was able to structure a non-recourse, cash-out refinance transaction, utilizing the office building and an adjoining parking garage for collateral," said Joseph Hevey Jr., managing director of Cohen Financial in the firm's Dallas office.

For more news and information visit Blumberg Capital Partners.

American Assets Picks Up $92M Office Portfolio

Ashforth Pacific, Inc. let go of a 593,117 square foot portfolio of office buildings this month as it sold six properties in Portland, Oregon for $92 million to San Diego-based American Assets. According to a CoStar report, the portfolio covers six office buildings within four contiguous blocks, including a condominium interest that totals 213,533 square feet in the 20-story Lloyd Tower, the 16-story Lloyd 700 Building, the 710 Oregon Square Building, the 830 Oregon Square Building, the 710 Oregon Square Building, and the Oregon Square 729 Building.

American Assets paid for the portfolio with proceeds from its IPO in January 2011. John Chamberlain, American Asset’s president and CEO, said the company is looking forward to expanding to other markets on the West Coast, including Santa Barbara and Seattle.

For more news and information visit Blumberg Capital Partners.

Offce Vacancies Decline in Q2

According to CBRE Econometric Advisors (CBRE-EA) the U.S. office vacancy rates dropped to 16.2% in the second quarter of this year. This drop, down 20 basis points from the previous quarter, marks the fourth consecutive quarterly decline reports CBRE.

"The property sectors outside of retail are benefiting from the modest pace of economic recovery and muted construction activity," noted Asieh Mansour, head of Americas Research for CBRE. "The retail sector continues to feel the effects of a cautious consumer, hit by rising food and energy prices, as well as elevated rates of unemployment. Mounting competition from online shopping has also hurt demand for bricks-and-mortar retail."

For more news and information visit Blumberg Capital Partners.

Pension Fund Sells Stake in Manhattan Tower for $341M

The California State Teachers' Retirement System (CALSTRS) recently sold its 65% stake in 120 Broadway to UBS Realty Investors for $341 million according to a Wall Street Journal report. The sale price marks a big profit for the pension fund as it originally acquired the asset for $240 million in 2004. The remaining 35% ownership of the property is held by developer Larry Silverstein. The building is currently 90% leased with major tenants including the New York State Attorney General and Bank of New York Mellon Corp.

The property, also known as the Equitable Building, is a 38-story skyscraper designed by Ernest R. Graham and finished construction in 1915; upon its completion, the building was the largest (in total floor area) in the world. After buying the building in 1980, Larry Silverstein had the building renovated and restored at a cost of $30 million, with renovations completed in 1990. As reported by the WSJ, the $155 billion California fund and Silverstein launched a partnership in 2006 to invest up to $2 billion in the tri-state area.

For more news and information visit Blumberg Capital Partners.

Report Shows DC Real Estate Slowed

A new article from the Washington Business Journal examines a quarterly report released by CB Richard Ellis showing that commercial real estate in the DC Metro area has cooled a bit. The report shows that vacancy rates fell to 12.6% in the second quarter from 12/7% in the previous quarter, while the office vacancy rate little changed at 10%. According to the article, CB Richard Ellis reported that only four of the top 25 deals in the District were with the federal government, and only one government deal over 10,000 square feet was recorded in suburban Maryland in the second quarter, a two-year low.

"While we remain one of the strongest and most stable commercial real estate markets in the country, everyone seems to have hit the pause button as they take a "wait and see" approach," said John Germano, executive managing director of CBRE's Washington-Baltimore region. "We are poised to see improvement in subsequent quarters but not until there is a clearer picture of where the economy is headed and what will happen with regard to the federal government, a key driver of real estate activity here in our region."

For more news and information visit Blumberg Capital Partners.

Nomura Takes 900,000SF in Midtown

Worldwide Plaza signed a new tenant this week as Nomura Holding America Inc., a subsidiary of Tokyo-based Nomura Holdings, Inc., leased over 900,000 square feet of space in the Midtown tower for its Americas headquarters. According to a GlobeSt.com article, Nomura expects that by mid-2013 the company will relocate from its current home at 2 World Financial Center in Lower Manhattan, where it subleases from Bank of America Merrill Lynch. John Cefaly, Rob Lowe, Clark Finney and Anthony Pasqual of Cushman & Wakefield, along with Ed Donery and David Heller of C&W's Transactions Group, represented Nomura in the deal. Peter Duncan, George Comfort and Matt Coudert represented building ownership in-house.

"We are delighted to welcome one of the financial services industry’s global leaders to Worldwide Plaza," said Peter Duncan.

"This demonstrates our long-term commitment to build a top-tier investment bank in the US," said Atsushi Yoshikawa, President & CEO Nomura Holding America Inc.

Nomura has leased 20 full floors in the 1.8 million square foot Class A office tower between 49th and 50th Streets on Eighth Avenue. Nomura is taking 10 vacant floors as well as 10 floors presently occupied by Universal Music Group, which is leaving the building at the end of the year.

For more news and information visit Blumberg Capital Partners.

Jackson National Life Building Sold for $41.5M

Wells Core Office Income REIT (Wells Core REIT) announced last week that it had purchased the Jackson National Life building in Englewood, Colorado for $41.5 million according to a Citybizlist report. The building is fully leased by Jackson National Life Insurance Company through March 2017.

"We are enthusiastic about this latest acquisition as it folds very nicely into our core strategy." said Don Henry, chief real estate officer of Wells Real Estate Funds, advisor to the REIT, "In particular, we are thrilled to add another investment-grade rated tenant, Jackson National Life, to our expanding Wells Core REIT portfolio."

According to the REIT's June 27 filing with the Securities and Exchange Commission, the current annual effective base rent under the Jackson National Life lease is approximately $4.4 million.

For more news and information visit Blumberg Capital Partners.