Farbman Group Buys Chase Tower

An affiliate of Southfield, Michigan-based NAI Farbman Group, an investment group that operates commercial properties throughout the Midwest, has purchased the Chase Tower in downtown Milwaukee for $30.5 million. The office tower was sold by Breof Bank Midwest LLC, an affiliate of Toronto-based Brookfield Asset Management Inc.; "Breof" stands for Brookfield Real Estate Opportunity Fund. According to a Milwaukee Business Journal report, Farbman has been eying the property for several years now, which Brookfield placed on the market in October 2014.

The property was officially purchased by 111 W. Wisconsin Property Owner LLC, which is registered to NAI Farbman Group. Cushman & Wakefield's Chicago office marketed the building for Brookfield Asset Management, which bought the office tower in 2006 at the peak of the commercial real estate market for $45.8 million. The sale includes the connected parking structure at 543 N. Water St. Terms of the deal were not disclosed.

The new owners have plans to upgrade Chase Tower's first and second floor commons areas and adding amenities. "We're going to take its natural bones and make it better," said Andrew Farbman, chief executive officer of NAI Farbman Group. "There is a lot to draw from and the downtown location is fantastic. There is some access to public transportation now, and Milwaukee is growing in that area, plus the residential footprint in the Third and Fifth wards is something we're really fired up about."

Chase Tower, one of downtown Milwaukee's largest office buildings, was designed by Harrison & Abramovitz and completed in 1961. The 22-story office building was originally known as the Marine Plaza (which was the largest office building in Milwaukee until 1973 U.S. Bank Center build), and later as Bank One Plaza until their merger with Chase. The building was 86% leased at the time of sale, with major tenants including JPMorgan Chase, Infinity Healthcare, WUWM Public Radio and the law firm of O'Neil, Cannon, Hollman, DeJong & Laing.

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Brookfield to Acquire Rouse Properties for $2.8B

Rouse Properties Inc. announced that it has agreed to be acquired by an affiliate of Brookfield Asset Management Inc. in a deal valued at approximately $2.8 billion. Rouse has entered into a definitive agreement at $18.25 per share in an all-cash transaction; Brookfield, which already owned about a third of Rouse, originally proposed to acquire the group mid-January of this year of about $2.54 billion in a deal that valued Rouse at $17.00 per share. BofA Merrill Lynch is acting as financial advisor and Sidley Austin LLP is acting as legal counsel to the Special Committee of Rouse Properties, Inc.

"The Rouse team has built a great company with a strong platform and differentiated assets," said David Kruth, chairman of the Special Committee of the board of Rouse Properties, which unanimously approved the deal. "After careful consideration, the Special Committee determined that Brookfield's increased proposal provides shareholders with compelling value as well as a high degree of execution certainty, further validating the strength of the platform that Rouse has built. We are pleased to have reached this agreement, which we believe benefits all Rouse shareholders."

Rouse Properties is among the U.S.'s largest publicly traded regional mall owners. The REIT's portfolio includes 35 malls and retail centers in 21 states encompassing approximately 24.1 million square feet.

For more news and information visit Blumberg Partners.

Brookfield Making Moves in China

Brookfield Asset Management, the Toronto-based global asset manager with landmark properties including Brookfield Place in Manhattan and Bank of America Plaza in Los Angeles, has plans to aggressively expand its portfolio of commercial space in China. According to a Wall Street Journal report, last month Brookfield bought nearly 22% interest in a unit of Hong Kong-listed property developer Shui On, which built the popular Xintiandi commercial complex in Shanghai.

Bruce Flatt, Brookfield Chief Executive Officer, has said that after spending recent years investing in distressed developed economies, the firm is bullish on China's office sector and focused on the long term, with the firm's new venture looking to tap into Shui On's local insights and ultimately yield at least 15% on equity.

According to real-estate consultancy CBRE, the office markets in tier-two Chinese cities—large cities that nonetheless lack the stature of leading Chinese cities such as Beijing and Guangzhou—are often more risky and at an early, uncertain stage of development. China's property market generally has a two-tiered structure in which top cities such as Shanghai and Beijing see strong demand and liquidity, but markets in second- and third-tier cities face a supply glut.

For more news and information visit Blumberg Capital Partners.

Brookfield Closes $886M Verde Realty Acquisition

Brookfield Asset Management Inc. announced that it had closed the acquisition of a majority ownership position in Verde Realty, a Maryland real estate investment trust, for $886 million. This means that an investment vehicle controlled by the asset manager will be responsible for approximately 81% of the common equity in Verde, with the remainder controlled by present Verde shareholders, according to a GlobeSt.com article.

"We look forward to building on our reputation for delivering well located, high quality distribution facilities for our clients and executing our growth strategy that includes acquisitions and property development," commented Ronald Blankenship, Chief Executive Officer of Verde Realty.

"Verde is a scalable, cornerstone investment in the industrial property sector that positions Brookfield to expand its real estate platform into the logistics arena to capitalize on the evolving global supply chain," said David Arthur, Managing Partner at Brookfield Asset Management. Verde owns 111 industrial distribution facilities comprised of 18 million square feet of space in major U.S. distribution markets and gateway trade markets along the U.S. and Mexican border, as well as over 20,000 acres of land intended for future sale and development. Under new ownership, the company plans to expand its holdings and seek consolidation opportunities in the fragmented industrial real estate sector.

For more news and information visit Blumberg Capital Partners.

Arlington County Expands Court House Area With $27.1M Purchase

The Arlington County Board in Virginia voted unanimously over the weekend to purchase 2020 14th St. North for $27.1 million from Brookfield Asset Management. County Manager Barbara Donnellan first mentioned the County's interest in the property last year and, in a Washington Business Journal article, stated that if a a "voluntary purchase" was unsuccessful, "then the County may acquire the property by eminent domain." After the County acquires the property, which is set to close on November 20, it will engage in a separate use permit process for consideration of the Comprehensive Homeless Services Center and the County Board directed the County Manager to formulate a robust public process to include all stakeholders.

"This purchase meets a number of long-standing County space needs, including continuing our 20-year practice of providing services to homeless persons in the Courthouse area," commented Arlington County Board Chair Mary Hynes. "We look forward to working with the community to develop a Use Permit for the Homeless Services Center to meet the needs of all who live and work in Courthouse."

Most of the floors at 2020 14th St. North will be dedicated to county office space, but two floors will offer about 50 beds for single adults, five medical respite beds and another 25 spaces during winter months, as well as space for programs intended to get people into permanent housing, according to a Washington Post article. The seven-story building near the courthouse currently has three street-level retail stores that will be offered leases to stay while the 18 offices above them will eventually have to move. The county set aside $2.5 million to help relocate those tenants.

For more news and information visit Blumberg Capital Partners.

Brookfield, Hillwood Form $1B Industrial JV

Brookfield Asset Management announced this week that it had formed a joint venture with Hillwood to acquire, develop and manage industrial property, principally large warehouses, across the United States. With an equity commitment of $400 million, the partnership is expected to deploy up to $1 billion within the first three years.

"The partnership between Brookfield and Hillwood is not only the right fit, it’s happening at the right time," said Ross Perot, Jr., Chairman, Hillwood. "Industrial development slowed during the downturn due to a lack of equity and debt. Given the liquidity and resources supporting our investment, our joint venture is well-positioned to benefit from renewed demand for industrial space which will increase as the economy continues to show signs of improvement."

Overall, the fund is targeting returns in the 13 percent to 16 percent range reported the National Real Estate Investor. The average investment size will be between $20 million and $60 million. And David Arthur, Managing Partner at Brookfield Asset Management, expects the fund will hold assets three to five years after repositioning them.

"As long-term, value-oriented real estate investors, we believe this is an excellent time to selectively build a portfolio of high-quality industrial properties, and we look forward to expanding our relationship with Hillwood," said Arthur. "This initiative expands the scope of our real estate platform in an exciting asset class, strengthening our global property operations in line with the expected launch later this year of our flagship property vehicle, Brookfield Property Partners."

For more news and information visit Blumberg Capital Partners.