The Brill Building Sold for $185.5M

Real estate investor Eric Hadar of Allied Partners, along with the private equity firm Brickman, have taken ownership of the iconic Brill Building in New York at a purchase price of $185.5 million, or about $1,100 per square foot. Barry Sternlicht's Starwood Property Trust provided a $158.5 million first mortgage to help finance the transaction, while Square Mile Capital Management provided $40 million of financing. Adam Spies and Doug Harmon of Eastdil Secured brokered the sale.

"We are excited to be involved in a project that will help modernize one of Times Square's most famous and storied buildings," said Boyd Fellows, President and Director of Starwood Property Trust. "This transaction is a prime example of our unique ability to act as a one-stop-shop to provide large, highly specialized loans that meet the needs of high-quality sponsors like Allied Partners and Brickman."

The Brill Building was 27% occupied at the time of sale, but the new owners have plans to begin extensive renovations expected to retain the landmark building's heritage and aesthetic while modernizing infrastructure. The new space, opening in 2014 will house the Songwriters Hall of Fame among other tenants including fashion, arts, media, entertainment and other creative office users, according to a CoStar report. Moving forward, retail leasing will be managed by Jeffrey Roseman of Newmark Grubb Knight Frank with commercial leasing run by Paul Kotcher of Brickman.

For more news and information visit Blumberg Capital Partners.

America Center Up for Sale

Legacy Partners, a vertically integrated real estate investment firm, announced this week that it had retained HFF and Cornish & Carey Commercial Newmark Knight Frank to spearhead the sale of the entire America Center project in Santa Clara, California. The offer for sale includes the two 213,000-square-foot, six-story buildings and roughly 13 acres of adjacent land that is envisioned for two additional 213,000-square-foot buildings. According to a Silicon Valley Business Journal article, several real estate sources indicated the property could trade for significantly north of $400 per square foot, based on the built space; a range of $400 to $500 a foot would pencil to $170 million to $213 million.

"America Center was conceived and constructed as an environmentally advanced office campus that reflects a growing demand for a sustainable land use policy and modern workplace environments in Northern California, Silicon Valley and indeed the nation," said Derrick How, Vice President of Acquisitions and Development for Legacy Partners Commercial, in a 2010 article shortly after Legacy Partners updated the property. "This project required us to work with the most current techniques in design, construction and remediation, an investment we hope serves as a ready inspiration for our corporate tenants seeking to further elevate the Bay Area’s commitment to long-term sustainability and continued progress in the adoption of clean technologies and green infrastructure."

Construction of the America Center began in June 2000 after Legacy Partners acquired more than 60 acres at Highway 237 and Great America Parkway from Cargill Salt. In 2007, HKS Architects were commissioned by Legacy Partners to expand and update the property with an advanced and modern mindset. America Center was shell complete in July 2009 and soon became San Jose's first LEED Gold-certified speculative office development built on a fully restored brownfield.

For more news and information visit Blumberg Capital Partners.

Princeton Holdings Sells Interest in Manhattan Office Portfolio for $74M

Princeton Holdings LLC, a leading real estate investment and finance firm, announced this week that it had sold its interest in a one million square-foot office portfolio in Manhattan's Midtown South submarket for $74 million. According to a Wall Street Journal report, the buyer was Extell Development, a major New York City real estate development and investment firm. Terms of the deal were not disclosed, though it is known that a joint venture led by Princeton bought a 25% stake in the portfolio, (known as the 'Ring portfolio') controlled by F.M. Ring Associates, in 2011 with a deposit of $10 million.

"Our investment philosophy at Princeton Holdings can best be defined as long-term with the ability to seize upon near-term exit opportunities if they are too attractive to resist," said Joseph Tabak, CEO of Princeton Holdings. "Back in 2011, we engaged in a process that will now unfold over the coming years without our involvement. While we are pleased with the outcome here, it's clear that the portfolio will ultimately yield many rewards for those who have the fortitude to 'crack the code' here. As we have done before, we will re-invest the proceeds from this lucrative deal back into our core business of real estate investment and development."

The portfolio includes 14 commercial office buildings, among them 212 Fifth Avenue and 251 Park Avenue South. Market estimates peg the value of the entire Ring portfolio at roughly $400 million to $500 million.

For more news and information visit Blumberg Capital Partners.

Seventh Street Developing 1.5M SF Industrial Park

In what will be the largest warehouse built in the San Gabriel Valley in the last three years, Seventh Street Development announced that it has begun construction on a new 1.5 million square-foot industrial park as part of the Mission 71 Business Park's third phase of development. In April 2012, Seventh Street purchased an additional 11.3 acre parcel from the US Government and has processed plans for development of a 245,000 square foot state-of-the-art warehouse and manufacturing building with 32 foot clear height, ESFR sprinkler system, 41 dock-high loading positions and signature signage on Mission Boulevard. Construction is expected to be completed by year-end.

"No new construction in the past three years has created a significant lack of product, making the San Gabriel Valley industrial market one of the tightest markets in the entire L.A. region," broker Lynn Knox of CBRE said. Kittrich Corp. – which also manufactures pens, highlighters and other school supplies – will make the new 240,000-square-foot building its headquarters when it relocates from La Mirada by the end of the year, according to a Los Angeles Times article.

"Demand is expected to outpace new supply in the San Gabriel Valley, especially for free-standing buildings like these that are offered for sale as well as lease," said Craig Furniss, principal at Seventh Street Development, in a statement. "There is a negligible amount of new class-A industrial space under construction in this market which makes the timing right to move forward with Phase III."

For more news and information visit Blumberg Capital Partners.

KBS REIT III Closes on $269M Office Portfolio

Marking its largest transaction to date, KBS Real Estate Investment Trust III (KBS REIT III) announced this week that it had closed on the purchase of a $269 million office portfolio in Dallas and Maryland, dubbed the National Office Portfolio. KBS REIT III bought One Washington Center, a 321,007-square-foot building at 9801 Washingtonian Blvd. in Gaithersburg, Maryland, along with two other buildings in Dallas from affiliates of CBRE Global Investors. The sale comes a little more than two years after CBRE bought the building for $90 million, according to a Washington Business Journal article.

"The new National Office Portfolio represents another great addition for KBS REIT III," said KBS REIT III CEO Chuck Schreiber. "These are top-tier office assets in strong markets that have all the attributes KBS REIT III looks for in an investment."

"The Dallas purchases represent a pair of assets in the top-performing submarket of Preston Center in what we believe to be one of the best-performing overall markets in the country," said Ken Robertson, senior VP and asset manager of KBS Capital Advisors, KBS REIT III's external advisor. "These acquisitions in this amenity- and lifestyle-rich neighborhood fit the mold of what we're looking for. Dallas has a great workforce in a pro-business environment and we are grateful for the opportunity to acquire such a trophy-quality portfolio from CBRE Global."

In Dallas, KBS REIT III acquired Preston Commons, a three-building, Class-A complex with 427,799 rentable square-feet, which covers 6.33 acres with 1,311 parking spaces in a subterranean three-level garage. The other property, Sterling Plaza, is a one-building, Class-A structure designated LEED Silver for sustainability. It has 313,609 rentable square feet with a six-and-one-half level parking structure. Both properties were renovated in 2012.

For more news and information visit Blumberg Capital Partners.

Nike Buys More Office Space for $84.5M

In a deal that expands Nike's global headquarters footprint by nearly 600,000 square feet, the footwear and apparel giant has purchased more buildings around its current headquarters for $84.5 million. Each of the properties was formerly owned by Triple Net Properties LLC, a subsidiary of Grubb & Ellis, according to a Portland Business Journal article. In April 2012, Nike acquired four other office buildings adjacent to its campus in a $44 million deal.

The two new properties, called Woodside I and Woodside II, are located within Beaverton, Oregon city limits southeast of the Southwest Walker Road and Southwest 158th Avenue intersection. "These real estate investments are designed to help support Nike's growth," Nike spokeswoman Mary Remuzzi, in an email to the Journal.

For more news and information visit Blumberg Capital Partners.

SoHo Mixed Use Sold for $81M

Ellwell Associates LLC, established in 1995 and incorporated in New York, sold 375 Broadway in SoHo for $81 million to Real Estate Equities Corporation. The 55,000 square-foot building was purchased by Real Estate Equities, headed by father and son Michael and Brandon Miller and Mark Siegel, in partnership with the overseas investor accessed by The Carlton Group. The seller was represented by Lee Spiegelman, founder and managing principal of SplitRock Group, in the transaction; Laurence Ross, managing principal of Highcap Group, represented the buyer.

The five-story office and retail building at 375-377 W. Broadway in New York City between Broome and Spring Streets was owned by Ellwell Associates for decades. Currently, apparel retailer Anthropologie leases 11,200 square feet of ground floor retail space, as well as 7,000 square feet in the basement, in a lease that runs through March 2016, paying about $115 per square foot, Steven Fenster, a managing director at financial firm Carlton Advisory Services, said. All the rents in the building are significantly below market, so there is a tremendous amount of upside," Brandon Miller said. "Soho is a great [New York City] submarket, and we are very excited about this investment."

For more news and information visit Blumberg Capital Partners.