Boston Properties Buys In to Colorado Center

New York-based mega investment firm Blackstone Group is selling its stake in a Santa Monica office complex to Boston Properties for more than $500 million, marking the real estate investment trust's first purchase in southern California. According to a report from The Real Deal, it is the priciest single-property commercial sale to go down in L.A. County this year. The Teachers Insurance and Annuity Association (TIAA), a financial services organization, still controls the other 50% interest in the property.

Blackstone Group is selling the 50% stake in the Colorado Center that it acquired in 2007 from Equity Office Properties Trust as part of a $39 billion buyout of the company, the Los Angeles Business Journal reported. Equity Office bought the complex for $443.6 million in 2004 from Tishman Speyer Properties through a joint venture with TIAA-CREF, leaving Equity's net share of the purchase price at approximately $221.8 million. Prior to that, Tishman Speyer acquired the office property for about $353 million in 2000 from Maguire Partners.

"After a decade-plus of Boston Properties angling for a way to buy into the westside L.A. office lifestyle, it seems that the company has finally been able to plant its flag near the Santa Monica beaches," Alexander Goldfarb, an analyst with Sandler O'Neill & Partners LP, wrote in a research note after the Real Deal report. "Boston Properties' fortress balance sheet makes it well-suited for these sorts of purchases."

Colorado Center, formerly known as the Yahoo Center and MGM Plaza, is a six building, 15-acre property in the Silicon Beach area of Santa Monica with over a million square feet of office space. Originally built in the 1980s, the property has undergone several renovations, including a major overhaul prior to Yahoo's arrival by then-owner Tishman Speyer. The property was roughly 63% leased at the time of sale, with major tenants including Hulu, Yahoo! Inc., Riot Games Inc. and eHarmony.

For more news and information visit Blumberg Partners.

Tishman Plans New M Street Office Building

New York City-based Tishman Speyer released renderings this week for the redevelopment of 2050 M Street in Washington, DC, which currently serves as the DC bureau of CBS News. With delivery expected for 2019, the 364,000 square foot building will include iconic, modern design provided by REX Architects. The building is expected to be constructed in two phases to enable uninterrupted broadcasting for CBS, who will remain at the property throughout the transformation. This is the first project in the District for REX, whose portfolio includes Five Manhattan West in New York City, and the Equator Tower in Kuala Lampur.

"What we tried to do was to really find a way to distinguish our building with some shape and movement but still operate within those constraints," said Tishman Speyer Managing Director Paul DeMartini, who declined to disclose project costs.

Joshua Prince-Ramus, the principal of New York-based firm REX, added that "the proposal was very, in a way, simple, and that was by giving the glass a subtle curvature. One of the beautiful effects is it makes the building look fluted, almost like a Tiffany glass, like a champagne glass."

Once complete, 2050 M Street will be encased in a glass façade that creates a kaleidoscope effect, consisting of an innovative floor-to-ceiling curved glass wall with no vertical mullions. "Because of the curve's inherent rigidity in compression, only the top and bottom edges of the panels are supported from the floor slabs, while the 'mullion-less' vertical edges are flush-glazed for a minimalist aesthetic that improves sightlines, while gaining useable floor area," said the firm in a statement. The building will also feature a private 11th floor balcony, fitness center, and a panoramic roof deck with sweeping views of the city.

The property is located in the city's Golden Triangle business district, steps from four lines of the Metro system and a 15-minute drive from National Airport. According to BizNow, Tishman acquired the CBS building at 2020 M St last summer for $30.5 million, and followed that with the acquisition of 2030 M St for $49 million.

For more news and information visit Blumberg Partners.

Tishman Buys CNN Tower from Broadreach Capital

NY-based Tishman Speyer has purchased the CNN Building at 6430 West Sunset Blvd. in Hollywood for more than $127-million, or more than $600 a square foot, from Palo Alto-based investment firm Broadreach Capital Partners. Broadreach originally acquired the property in April 2006 for $50 million. HFF's Todd Tydlaska and Andrew Harper represented Broadreach in the sale, with leasing guidance from Madison Partners' Steven Salas, Tony Ranger and Joe King. Tishman Speyer was self-represented in the acquisition.

"We're pleased to add this extremely well-located asset to our Los Angeles office portfolio," Rob Speyer, Tishman Speyer's president and chief executive officer, said in a prepared statement. "In particular, we continue to be very bullish on the Hollywood submarket as one of the key areas attracting growing companies with employees who want to live and work in a vibrant 24-hour community."

The 15-story tower was originally constructed in 1986, renovated in 2001, and awarded LEED certification by the U.S. Green Building Council in 2013. The property was 84% leased at the time of sale, with the tower now anchored by CNN's parent company Turner Broadcasting System, the movie-trailer-maker BLT & Associates, and advertising agency Oxford Road. Tishman Speyer plans on raising rent at the 204,122-square-foot Class A office property, sources tell the Real Deal; a five-story parking structure is adjacent to the tower.

For more news and information visit Blumberg Partners.

Hines JV Buys 4000 MacArthur

Hines, the international real estate firm, announced this week that along with a subsidiary of a fund managed by Oaktree Capital Management it had purchased 4000 MacArthur in Newport Beach, California. The sale price or terms of the deal for the two ten-story buildings were not disclosed, but it is known that a previous owner, Tishman Speyer Properties, was marketing the property in 2007 and expecting to fetch around $170 million; Tishman paid KBS about $134 million, or $365 per square foot, for the two office towers in 2006. In 2011 Emmes reportedly bought a $40 million junior portion of a $100 million mortgage tied to the property for 80 cents on the dollar and moved to foreclose on the property from Tishman, according to an Idea Hall article.

Hines Managing Director Ray Lawler, who leads the firm's Orange County development and investment office, said, "4000 MacArthur's location, access, visibility, quality improvements, and credit tenancy make this a particularly attractive acquisition for Hines and Oaktree. We expect the exceptional top floor vacancy, creative speculative suites, and prominent building top and monument signage will draw additional premier tenants to our project."

Oaktree Managing Director Ambrose Fisher added, "4000 MacArthur is our eleventh project with the Hines Orange County team. We now own 2.8 million square feet in Orange County that we have taken from 65 percent leased at acquisition to nearly 90 percent leased today. Globally, we have purchased 21 office deals in the US and the United Kingdom with Hines, totaling 8.2 million square feet. With the addition of 4000 MacArthur to our portfolio, we look forward to owning two of the best buildings in Orange County."

The property was roughly 91% leased at the time of sale to twelve tenants, including: Hyundai Capital America, M/A-COM Technology Solutions Holdings, Lifescript, and Premiere Business Centers. Hines has assumed on-site property management responsibilities on behalf of the joint venture.

For more news and information visit Blumberg Capital Partners.

Rockefeller Acquires UTA Plaza and the Ice House Properties

Rockefeller Group Investment Management, which coordinates the real estate investment activities for The Rockefeller Group, announced that it has acquired an office building portfolio in Beverly Hills, CA from Tishman Speyer for an undisclosed amount. The 236,000 square foot portfolio on Civic Center Drive includes UTA Plaza and The Ice House, consisting of 9336, 9346 and 9348 Civic Center Drive. Eastdil Secured was the sole advisor involved in the transaction.

"We remain focused on acquiring high quality assets in gateway markets, and we are very pleased with the strong fit offered by these properties in West Los Angeles," said Atsushi Nakajima, president and chief executive officer of The Rockefeller Group.

"These are distinctive properties in an established institutional market," said Dennis Irvin, president and chief executive officer of Rockefeller Group Investment Management. "They represent premier assets with prominent tenants, in a highly desirable submarket with supply constraints, all of which combine to offer stability, liquidity and good long-term prospects."

According to a Commercial Property Executive article, the property was 100% leased at the time of the sale, with major tenants including United Talent Agency, Playboy Enterprises, and Live Nation Worldwide.

For more news and information visit Blumberg Capital Partners.

Tishman Speyer Buys NYC Development Site for $438M

Tishman Speyer announced this week that it had acquired the rights to develop a 2.85 million square foot tower in Midtown Manhattan's Hudson Yards district, purchasing two undeveloped and adjacent parcels of land on 10th Ave. between West 34th St. and West 35th St. The assembled development site, which was acquired in separate transactions, paid $438 million for the development site, according to a Wall Street Journal report. The assemblage, along with the ability to purchase additional development rights that are available to Hudson Yards district developers, offers Tishman Speyer the rare opportunity to develop and construct a 2.85 million square foot tower in the heart of Manhattan's expanded west side neighborhood and business district.

"For several decades, Tishman Speyer has been one of the world's most active ground-up developers and investors, with projects currently being constructed or in the pipeline on four continents," said Tishman Speyer Co-CEOs Jerry Speyer and Rob Speyer in a statement. "We are very bullish on New York City and Hudson Yards, and found this to be the perfect time, development site and opportunity to participate in establishing Hudson Yards as the world's next great commercial district and neighborhood."

"New York needs more office space," added Rob Speyer. "There's a scarcity of large blocks of space that's going to be more pronounced in years ahead."

For more news and information visit Blumberg Capital Partners.

Miami's Courvoisier Centre Sold for $145.8M

Parkway Properties, Inc. announced this week that it had purchased Courvoisier Centre in Miami, Florida for $145.8 million, or $422 per square foot, from Tishman Speyer. Parkway handled the transaction in house, while Tishman was represented by Jones Lang LaSalle in the deal. Parkway funded its acquisition in-part with available cash on hand and borrowings under its new seven-year, unsecured credit facility, according to a CoStar report. In connection with the financing, Parkway took the full amount of its $100 million loan, while simultaneously paying in full the first mortgage debt secured by the firm's Bank of America Center in Orlando, FL, which had an outstanding balance of $34.2 million including breakage costs.

"The acquisition of Courvoisier Centre supports our strategy of acquiring best-in-class assets within the strongest submarkets across the Sunbelt. The buildings' high-end amenity base, along with available parking infrastructure and water views, makes Courvoisier Centre a highly desirable asset," said James Heistand, Parkway Properties' President and Chief Executive Officer. "Further, a heavy emphasis on multifamily development within the Brickell submarket has limited the amount of available supply of Class A office assets, which has enabled Brickell to achieve the highest rental rates in Miami."

The Courvoisier Centre is a two-building office complex with an adjacent five-story parking garage, located on Brickell Key Island in Biscayne Bay, 400 feet off the coast of Downtown Miami. The seven-story Courvoisier Centre I was completed in 1986, and the 12-story Courvoisier Centre II and parking garage and retail were completed in 1990. The property totals 330,000 rentable square feet, including the adjacent five-story parking garage. The properties were 83.4% leased at the time of sale with major tenants including Young & Rubicam, Sony Pictures, CNN, WWE, MGM, Live Nation, Swire Properties, and Medina Capital.

For more news and information visit Blumberg Capital Partners.

Highwoods Buys One Alliance Center in Atlanta for $143.4M

Raleigh-based Highwoods Properties, a publicly traded REIT, announced today that it had purchased One Alliance Center in Atlanta for $143.4 million, or $259 per square foot. The acquisition means that the company now owns both One and Two Alliance Center, having acquired Two Alliance Center last September for $146.7 million from Tishman Speyer. Dallas-based mortgage servicer ORIX Capital Markets sold One Alliance Center in a deal marketed by CBRE. In March, previous owner Tishman Speyer negotiated the transfer of ownership in One Alliance to ORIX, according to an Atlanta Business Chronicle article.

"The acquisition of One Alliance more than doubles our presence in Buckhead where we now wholly-own over one million square feet of contiguous Class A office space," said Ed Fritsch, president and chief executive officer of Highwoods. "This is a rapidly tightening submarket and we forecast leasing at One Alliance to exceed 93% within three years. In addition, we see opportunities to 'Highwoodtize' the property and expect to garner operating and leasing synergies by owning both Alliance Center towers through shared parking, shared amenities, shared vendor agreements and customer expansions to name a few."

The 20-story One Alliance building was 67% leased at the time of sale. Both towers stand over Georgia 400, an artery for intown office workers to the Atlanta suburbs, and across from Phipps Plaza, a ritzy mall owned by Simon Property Group.

For more news and information visit Blumberg Capital Partners.

Tishman Speyer Sells Two Alliance Center for $146.7M

Raleigh-based Highwoods Properties, Inc. announced that it had purchased Two Alliance Center in the Buckhead submarket of Atlanta for $146.7 million. According to an Atlanta Journal-Constitution article, real estate developer Tishman Speyer sold the iconic Buckhead office tower to Highwoods, which plans to spend about $800,000 in renovations to improve the building.

Ed Fritsch, president and chief executive officer of Highwoods, stated, "This investment garners us one of the best Class A office buildings in the southeast, a new building with a well-diversified rent roll that we acquired at a 10% discount to replacement cost. The building has an average remaining lease term of ten years and no lease expirations until 2017, when less than 24,000 square feet is scheduled to expire."

Completed in 2009, the 29-story, 492,000 square foot office tower at 3500 Lenox Road NE was designed by Smallwood, Reynolds, Stewart, Stewart & Associates, Inc. Two Alliance Center is within walking distance to both Phipps Plaza and Lenox Square Mall, two upscale malls, as well as a number of luxury hotels, including the Ritz-Carlton and the Mandarin Oriental. The property was roughly 90% leased at the time of sale with major tenants including Novelis Inc. and Marsh & McLennan Cos.

For more news and information visit Blumberg Capital Partners.

Tishman Speyer Forms New JV for Office Portfolio

Tishman Speyer Australia Limited, in its capacity as responsible entity of Tishman Speyer Office Fund (TSOF), announced that it has entered into an agreement to be acquired by a new joint venture between Tishman Speyer and a large pension fund. Tishman completed the transaction on April 3 with the new JV taking majority ownership interests in a portfolio of 16 U.S. office properties.

The joint venture holds a 100% stake in four properties - three Class A properties in Beverly Hills, California and a three-building suburban complex in Northern Virginia according to a Citybizlist New York article.

• Lakeside Complex (Loudon County, VA)
• Maple Plaza (Beverly Hills)
• 407 North Maple Dr (Beverly Hills)
• Beverly Mercedes Place (Beverly Hills)

The JV also holds a majority stake in a portfolio including the 12 properties listed below (the minority interest in this group of assets will continue to be held by an affiliate of the Government of Singapore Investment Corporation).

• 300 Park Avenue (NYC)
• CitySpire (NYC)
• Greenwich American Centre (Greenwich, CT)
• Bala Plaza (Bala Cynwyd -- suburban Philadelphia)
• Franklin Center - 227 W Monroe (Chicago)
• Franklin Center - 222 West Adams (Chicago)
• Plaza East I & II (Milwaukee)
• 520 Pike Tower (Seattle)
• One Bush Street (San Francisco)
• 595 Market Street (San Fran)
• Bayside Towers (Foster City, CA)
• 400 Castro St (Mountain View, CA)
• Lakeside Complex (Loudon County, VA)
• Maple Plaza (Beverly Hills)
• 407 North Maple Dr (Beverly Hills)
• Beverly Mercedes Place (Beverly Hills)

"This transaction marks the disposition by TSOF of its assets on terms that represent a successful outcome for all stakeholders," Tishman Speyer Co-CEOs Jerry Speyer and Rob Speyer said in a joint statement. "Looking forward, we are very excited about the formation of this joint venture and we’re pleased that our partner recognizes the value of this portfolio of premium properties and has joined us in making this significant investment."

For more news and information visit Blumberg Capital Partners.

Live Nation HQ Sold for $20M

Tishman Speyer bought the office building at 9348 Civic Center Drive in Beverly Hills, CA this month for $20 million from Beverly Hills Ice House Investment Ltd., a group formed by Michael Ovitz and other partners. The property, also known as the Ice House, was previously sold for $3.3 million in 1993 and $10.5 million in 1989 according to CoStar Group information.

The Ice House serves as the world headquarters for Live Nation Entertanment, which merged with Ticketmaster last year. Live Nation will remain at the building under a long term lease until at least 2020. The 44,673 square foot building was originally built in 1925 as an ice storage plant and renovated in the 1990s for office space with design from Barton Myers. The Ice House is next door to Hilton Hotels' former 184,305-square-foot corporate office complex, a property Tishman purchased nine months ago and is currently renovating.

"We have confidence in the long-term strength of the market in Beverly Hills and elsewhere in Los Angeles, and we have assembled a group of attractive, strategically-located office properties that appeal to high-end users," said Mark Laderman, Tishman's regional managing director, in an LA Times article.

For more news and information visit Blumberg Capital Partners.

H&R REIT Purchase Two Gotham Center for $416M

H&R REIT, an open-ended real estate investment trust, has entered into an agreement to acquire Two Gotham Center in Long Island City, New York for $415.5 million according to a Winnipeg Free Press article. The property represents the first building of the newly built Gotham Center - a 2-block, 3.5 million square foot development that is part of a budding rehabilitation effort in Long Island City. The purchase price equates to an estimated year one, stabilized capitalization rate of 5.85%.

H&R REIT's President and CEO, Tom Hofstedter said: "Considering the unprecedented global demand for superior New York properties, we are thrilled that we were able to enter into an agreement to acquire this trophy asset and secure such exceptional mortgage financing."

Designed by Moed De Armas & Shannon of New York, Two Gotham Center was developed and owned by Tishman Speyer, in a partnership with Square Mile Capital and the Modell family. The recently completed Two Gotham Center tower comprises 661,000 rentable square feet of office space and is 100% leased to the City of New York for an initial term of 20 years with contracted rental escalations of approximately 8% every 5 years.

For more news and information visit Blumberg Capital Partners.

Tishman Speyer Sells DC Office Building for $137.4M

Carr Properties, in a joint venture with the Canada Pension Plan Investment Board and MetLife Real Estate Investments, has purchased the Floyd Akers Building from Tishman Speyer for $137.4 million according to a CoStar report. Tishman originally acquired the building at 1255 23rd Street, NW for $107.88 million from Blackstone/CarrAmerica in 2006 as part of a larger portfolio.

The Floyd Akers Building was developed in 1983 by The Oliver Carr Company and is a 341,443-square-foot, Class A office property in the West End submarket of Washington, DC. At the time of sale the building was nearly 95% leased with major tenants including Mercer LLC, the Chronicle of Philanthropy and The Chronicle of Higher Education. CoStar reports that the asking rent per year is roughly $40 per square foot.

For more news and information visit Blumberg Capital Partners.

Mesirow Financial Building in Chicago Finds Buyer

The 46-story Class A office tower at 353 N. Clark Street in Chicago known as the Mesirow Financial Building was purchased by New York-based Tishman Speyer according to a CoStar report. While no purchase price was disclosed, the seller, a subsidiary of te financial services firm Mesirow Financial Real Estate, was seeking $480-$495 million for the property when it was placed on the market in June as reported by CoStar. The 1.17 million square foot buildng was developed last year and is currently 81% leased with tenants including Jenner & Block, Mesirow, and Spencer Stuart.

"As the city's largest owner of Class A office buildings, Tishman Speyer is well positioned to take advantage of market demand for the highest-quality space in Chicago. This property is a great addition to our world-class office portfolio and the acquisition demonstrates our confidence in the Chicago market," said Casey Wold, a senior managing director at Tishman.

For more news and information visit Blumberg Capital Partners.

Market Center Office Complex in SF Sold for $265M

Manulife Financial, a Canadian-based financial services group, has entered into the Bay Area real estate market with the purchase of Market Center in San Francisco for $265 million, or $344 per square foot according to CoStar. Manulife acquired the 770,044-square-foot, two-tower office complex from RREEF America, which previously bought the complex in a joint venture with Page Mill Properties from Tishman Speyer for $79.5 million in October 2003. Page Mill sold its interest to RREEF for $127.5 million in May 2006.

Connected by a large landscaped courtyard, Market Center consists of two office towers: 555 Market Street, a 21-story, 283,000 square-foot building completed in 1965; and 575 Market Street, a 40-story, 487,000 square-foot building added in 1975. The buildings have been extensively renovated and modernized with state-of-the-art systems in the last few years and are in the process of being LEED certified for environmental sustainability. "We identified San Francisco as one of several potential growth areas for our real estate business and we are optimistic about the possibilities in this and other key markets as we continue to look for core office and industrial investment opportunities to complement our portfolio across the United States, Canada and Asia," Kevin Adolphe, COO of Manulife's Investment Division, said in a statement.

For more news and information visit Blumberg Capital Partners.