AEW Sells Seattle Tower for $370M

Germany-based Deutsche Asset and Wealth Management's Alternatives and Real Assets (ARA) has purchased a 28-story office building in Seattle's Lake Union submarket from AEW Capital Management for $370 million. The Seattle Times reports that AEW Capital Management paid $278.7 million for the building when it bought the property from Prudential and Touchstone about three years ago. The buyer financed the acquisition in part with $122.7 million in funding provided by The Prudential Insurance Company of America, according to a CoStar report.

"West 8th is located where Seattle's most sought after commercial, residential and retail properties intersect to provide a true urban live, work, play experience," said Todd Henderson, Head of Real Estate in the Americas for ARA. "This Class-A asset not only increases the quality of the portfolio, we believe it has the potential to provide investors with an attractive cash return for a high-quality office asset in a prime location."

The tower at 2001 8th Avenue, also known as West 8th, was designed by Callison and built in 2009 by Seattle-based Touchstone Corp. According to its listing on OfficeSpace.com, the 498,893-square-foot office tower has a vacancy rate of less than 2%, with online retailer Amazon.com occupying a majority of the building alongside Casey Family Programs and Seattle Children's Research Institute. West 8th features state-of-the-art office spaces, luxurious amenities and sweeping Lake Union views, and is the first multi-tenant building in the Seattle area to feature LEED Gold certification for new construction.

For more news and information visit Blumberg Partners.

Boston Properties' Back Bay MU Project

Boston Properties, Inc., an REIT that focuses primarily on the Boston, New York City, Washington, D.C., and San Francisco markets, and Whitehall Street Real Estate Limited Partnership IX, an affiliate of
Goldman, Sachs & Co., announced that they have submitted a letter of intent with Prudential Insurance Company of America to acquire the commercial property and development rights associated with the Prudential Center located in Boston's "Back Bay" office and residential neighborhood. MassDOT approved long-term leases of the four air and ground parcels at 145 and 165 Dartmouth St. to Boston Properties in December 2014; Boston Properties and Whitehall are seeking approval for development rights that would allow approximately 1.75 million gross square feet of new commercial construction, with two office buildings totaling 1.72 million net rentable square feet, a 477,000 net-rentable-square-foot retail complex and a parking garage with 2,700 spaces.

The letter is, of course, non-binding and doesn't ensure that an agreement will be reached to move forward with the companies' plans, but Prudential officials noted in a press release that the decision to move into exclusive negotiations now with Boston Properties and Whitehall was made for "strategic reasons." Brian Murphy, Managing Director for Prudential general account real estate investments, said, "From the beginning of this marketing process, we have been interested in alternatives to a straight cash sale. We believe in this property's potential for favorable investment returns well into the future, and we want to participate by retaining a stake -- directly, indirectly or both." David Raszmann, Prudential Vice President in charge of the property, added, "Prudential Center is indisputably the hub of Boston's Back Bay, and is one of America's best-recognized landmarks. Neither we, nor generations of Bostonians want that to be disrupted. The name Prudential Center will remain as part of the final deal."

For more news and information visit Blumberg Partners.

HFF Arranges $230M in Financing for Bascom Group

The Bascom Group, an Irvine, CA-based private equity firm, has received $230 million in financing for The Breakers Resort in Denver. HFF's Charles Halladay, Mark Erland, Josh Simon, Jordan Robbins and Lee Redmond negotiated the transaction, which includes a $165 million first mortgage, a $26.25 million mezzanine loan and $38.75 million in preferred equity. The $165 million first mortgage was a floating-rate loan and included a three-year term with two, one-year extension options that was provided through Bank of America and CIBC. The mezzanine loan and preferred equity were provided by Prudential Real Estate Investors' $805 million U.S. Real Estate Debt Fund.

"Bascom was able to access mezzanine and preferred equity capital available in today's market and obtain financing on The Breakers Resort by adding an additional parcel of developable land as collateral, resulting in a blended cost of capital of less than 5.0% and a combined debt yield of 6.25%," said Mark Erland.

"The overall structure limited the mezzanine financing, making it necessary to fund the remaining portion with preferred equity. The Bank of America, CIBC and Prudential lending teams did an outstanding job of closing the loan in less than 30 days, including negotiating an intercreditor," added Halladay.

Situated on 127 acres and developed by Koelbel and Company, which will retain an ownership interest, The Breakers Resort is located at 9099 East Mississippi Avenue close to Cherry Creek, the Lowry Redevelopment and a new community shopping center. The "strongly-performing" property is 95% leased and is comprised of six interconnected communities, each with their own clubhouse, surrounding a 55-acre recreational lake.

For more news and information visit Blumberg Capital Partners.