Commerce Plaza Office Complex Sold for $125M

The Blackstone Group is selling Commerce Plaza, a three building, 515,005 square foot office complex in Oak Brook, Illinois, for $125 million to Chicago-based Zeller Realty. When completed, this will be the biggest suburban office deal of 2016 and the largest since Blackstone and Wells Fargo bought Deerfield's Corporate 500 Centre from GE Capital Real Estate for $154M last year, according to a Bisnow report. Full terms of the deal were not disclosed, but Blackstone was represented by CBRE in the deal. The building was previously owned by Arden Realty Inc.

Located at 2001, 2015 and 2021 Spring Road and originally constructed in 1974, Commerce Plaza's seven-story buildings are currently over 95% leased, with TreeHouse Foods leasing roughly 100,000 square feet of space for its headquarters. Conveniently located in the heart of Oak Brook, Commerce Plaza is 20 minutes west of downtown Chicago and 15 minutes south of O’Hare International Airport. The property features interconnected buildings surrounded by landscaped grounds with a courtyard focal point and an attached covered parking structure and plenty of surface parking. Zeller also has a deal to buy Woodfield Preserve Office Center in Schaumburg for about $74 million, according to Chicago Business; the acquisitions are Zeller's first in the Chicago suburbs since 2007.

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Blackstone Mortgage Trust Acquires GE Portfolio

Blackstone Mortgage Trust, Inc., an REIT managed by BXMT Advisors L.L.C., a subsidiary of Blackstone, announced that it has completed the acquisition of substantially all of the GE Capital Real Estate mortgage loan portfolio. The sale of the GE/Mubadala JV to BXMT had been reported earlier this month; however, the REIT did not expressly identify the JV as a part of the GE Capital loan acquisition until Monday's announcement that it had closed on the portfolio, according to a GlobeSt.com report. In an SEC filing earlier this month, it made reference to "an additional $435.5 million of loan participation interests which are pari passu to related interests included in the loan portfolio."

Steve Plavin, BXMT's Chief Executive Officer, said, "I'm very pleased with our execution in closing the purchase of the GE loans. We have now acquired $4.8 billion of loans, including the participation interests from the Mubadala-GE joint venture. Because of the accelerated closing timeframe, the third quarter will now fully reflect the increased earnings power from these loans as well as the beneficial impact of greater scale and capital deployment on our ability to generate core earnings and dividends."

For more news and information visit Blumberg Partners.

GE Selling Real Estate, Dismantling GE Capital

Fairfield, CT-based General Electric (GE) announced this week that it is selling the bulk of its GE Capital banking business in an attempt to simplify the conglomerate and concentrate on the best-performing segments. Blackstone and Wells Fargo also announced that they had signed agreements to purchase most of the assets of GE Capital Real Estate in a transaction valued at approximately $23 billion. The transaction breaks down as follows:

• Wells Fargo has agreed to purchase performing first mortgage commercial real estate loans valued at $9.0 billion in the United States, UK and Canada.
• Blackstone's latest flagship global real estate fund, BREP VIII, has agreed to purchase the US equity assets for $3.3 billion. These assets are primarily office properties in Southern California, Seattle and Chicago.
• Blackstone's European real estate fund, BREP Europe IV, has agreed to purchase the European equity real estate assets, for €1.9 billion. These consist of office, logistics and retail assets, largely in the UK, France and Spain. The logistics assets will be integrated into Blackstone's European logistics platform, Logicor, and the retail assets into its European retail platform, Multi.
• BREDS, Blackstone's real estate debt fund, has agreed to purchase performing first mortgage loans in Mexico and Australia for $4.2 billion.
• BXMT, Blackstone's publicly traded commercial mortgage REIT, has agreed to purchase a $4.6 billion portfolio of first mortgage loans primarily in the US with Wells Fargo providing the financing.

Jon Gray, Global Head of Real Estate for Blackstone, said, "We are delighted to partner with GE on another major transaction and we thank them for their confidence in us. We also thank Wells Fargo for our longstanding relationship, and for their swift execution on this investment. This transaction clearly demonstrates the unique scale and reach of our real estate platform."

Mark Myers, Head of Commercial Real Estate for Wells Fargo, said, "This is an important transaction in the commercial real estate industry and Wells Fargo is pleased to be working with our colleagues at GE Capital and Blackstone. The portfolio of performing loans we've purchased is a strong addition to our commercial real estate platform in the United States, the United Kingdom and Canada, which are all active lending markets for us."

For more news and information visit Blumberg Capital Partners.

Parmenter Realty Partners Buys The Tower at Cityplace

Miami-based Parmenter Realty Partners announced this week that it had purchased The Tower at Cityplace in Dallas, Texas, marking the company's tenth investment in Parmenter Realty Fund IV. While the final purchase price was not disclosed, HFF, which sold the building on behalf of the owner, Dallas-based CPT Fee Owner LP, announced that it has arranged $100 million in financing for the property through GE Capital Real Estate, the proceeds of which were used to acquire the asset with a future funding component for leasing and capital expenditures. According to a Dallas Morning News report, real estate brokers speculate that the building went for more than $135 million.

"We are pleased to add The Tower at Cityplace to our Parmenter Realty Fund IV portfolio," said Darryl Parmenter, Chairman and CEO of Parmenter Realty Partners. "This iconic building was built with the highest design quality and standards and is the perfect asset to round up Fund IV before we launch our Parmenter Realty Fund V in January 2014."

The 1.3 million-square-foot office tower was originally built in 1988 less than a mile north of downtown Dallas and the Arts District. As part of the purchase, Parmenter Realty Partners plans to develop 600,000 square feet of restaurants, shops and residential space surrounding the 42-story office and retail tower at 2711 N. Haskell Avenue. Parmenter said it also plans to implement a comprehensive capital improvement program consisting of the renovation of the building's common areas as well as completing other capital projects to enhance the property's trophy stature.

"Uptown's vacancy rate currently stands at 11 percent and is projected to be single digit by the end of the year," said Spence Sowa, Senior Vice President of Acquisitions at Parmenter Realty Partners. "With limited new construction in the surrounding submarkets and an increasing demand for a live-work-play environment, The Tower at Cityplace is strategically positioned to take advantage of the growing market trend."

For more news and information visit Blumberg Capital Partners.

Business Property Lending Sold for $2.51 Billion

EverBank Financial announced that it had executed an agreement to purchase Business Property Lending, a unit of GE Capital Real Estate, for $2.51 billion in cash. No debt will be assumed in the acquisition, and is expected to close in the fourth quarter of this year pending regulatory approval. Business Property Lending, which originates and services commercial real estate loans, currently has 14 offices across the United States with roughly $2.44 billion of performing commercial loans and servicing rights on $3.1 billion of loans securitized by GE Capital.

BofA Merrill Lynch acted as the financial advisor to EverBank and Sullivan & Cromwell LLP acted as its legal advisor on the transaction. Goldman Sachs also acted as an advisor to EverBank and Gateway Asset Management LLC provided loan diligence. Deutsche Bank Securities acted as financial advisor to GE Capital and Weil, Gotshal & Manges LLP acted as its legal advisor.

"Today's announcement represents a compelling strategic expansion into business property lending in key metropolitan areas where EverBank currently has significant lending, leasing and deposit customers," commented Robert Clements, Chairman of the Board and Chief Executive Officer of EverBank. "We believe this fully integrated, high quality franchise will accelerate EverBank's strategic growth plans and will further enhance and diversify our robust, nationwide asset generation capabilities."

The sale will reduce GE Capital's ending net investment, a measure of the unit's size that excludes non-interest-bearing liabilities and cash, by $5 billion, a GE spokesman, Russell Wilkerson, said. "The transaction is consistent with our strategy of reducing our real estate portfolio," Wilkerson said in the e- mail reported by The San Francisco Chronicle. According to a New York Times blog, EverBank previously acquired the banking operations of the failed Bank of Florida in a deal brokered by the Federal Deposit Insurance Corporation in 2010.

For more news and information visit Blumberg Capital Partners.