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.