Westcore Secures $70M in Financing for California Properties

Westcore Properties, a San Diego-based owner and operator of institutional industrial and office properties, announced that it had secured $70 million in permanent financing for four recently purchased properties in California. According to a San Diego Business Journal article, terms of the deal were not disclosed, though a company statement said financing packages were arranged through Bank of America, Wells Fargo and U.S. Bank.

According to Don Ankeny, Westcore Properties' president and CEO, "The acquisition and immediate financing of these projects totaling almost 1 million square feet is a significant accomplishment for our company which is aggressively working to double in size over the next 12 months."

The financed projects, totaling nearly 1 million square feet, included Central Plaza, a three-building, 150,000-square-foot industrial project in Union City that was acquired for $13 million; Westlake Center, a 45,000-square-foot office building in Encinitas purchased for $6.8 million; Salt Lake Industrial Park, a 132,000-square-foot project in City of Industry purchased by Westcore in a short sale for $9.5 million; and Kato Industrial Park, a 625,000-square-foot, four-building industrial park in Fremont that was just purchased for $45.6 million.

For more news and information visit Blumberg Capital Partners.

New JV for DC Development as First Potomac Sells Share

Akridge, a DC-based full service real estate firm, announced this week that it had entered into a new joint venture with Mitsui Fudosan America as First Potomac Realty Trust sold its ownership share in a development project in the central business district of Washington, DC for $43.7 million. Mitsui Fudosan America acquired the First Potomac Realty Trust ownership interest in the project on 1200 17th Street, where a building (formerly occupied by the National Restaurant Association) is currently under demolition and will be redeveloped as a 168,000 square foot trophy-class building.

According to a Washington Business Journal article, First Potomac originally bought its 95% stake in the project in a joint venture with Akridge in late 2011 for $37.6 million. Akridge will continue to own its share of the project and will remain the developer.

"This sale allows us to achieve our previously stated goals of monetizing an investment after we have added value, significantly strengthening our balance sheet, and decreasing risk in our portfolio," said Douglas J. Donatelli, Chairman and CEO of First Potomac Realty Trust. "While we know 1200 17th Street will be a very successful project, we could not pass up the opportunity to sell our position at a significant profit. We wish our friends at Akridge great success as they move forward with 1200 17th Street and we hope to have the opportunity to team up with them again in the future."

For more news and information visit Blumberg Capital Partners.

Internet Firms Expand Silicon Alley

A New York Times article titled Square Feet: Tech Firms in Manhattan Trade Trendy Lofts for Midtown Bargains takes a look at the current growth in popularity for business space in Manhattan's Silicon Alley. "Silicon Valley is on their fifth generation," said Kevin Ryan, chief executive of the Gilt Groupe. "We're on our second or third generation of New York entrepreneurs, combined with a bigger and better infrastructure to support it, so the scene is just mushrooming."

According to an article from The Economic Times, companies like 10gen and Firespotter Labs contribute to New York's growing role as an Internet hub, particularly for the new generation of online media and retail companies. Last year, 256 New York tech startups raised $2.2 billion in investment, up from 149 and $1.3 billion five years ago, according to the National Venture Capital Association.

An excerpt from the NYT article:

More than 100 Internet-based marketing firms, retailers and social networking companies are based in the area between the Flatiron Building and Central Park, out of about 1,400 similar businesses across the city, according to data compiled by NYC Digital, an initiative started last year by Mayor Michael R. Bloomberg to promote the city's technology industry.

"The boundaries of Silicon Alley are definitely pressing outward," said Jonathan Serko, a broker with Cushman and Wakefield who has worked to bring tech companies to Midtown. He added, "some of the companies are moving out of necessity."

In pockets of downtown Manhattan, commercial rents have spiked in recent years as increasingly fashionable neighborhoods like Chelsea, Greenwich Village and the financial district have welcomed a surge of new businesses. Residential conversions have also gobbled up the types of industrial buildings that tech companies once favored.

For more news and information visit Blumberg Capital Partners.

Finesa Closes $70M for Investment Fund

Finesa Real Estate Group announced this week that it had raised $70 million for their Diversified International Partners fund, which will use foreign cash to invest in commercial real estate in the top U.S. markets, Citybizlist.com reports. This is the first closing of a $200 million equity fund, Diversified International Partners (DIP). DIP is a real estate private equity fund developed for Latin American institutional and qualified high net worth investors.

Finesa retained Transwestern Investment Management (TIM) as the exclusive investment manager. Together, Finesa and Transwestern developed a diversified strategy designed to mitigate downside risk while achieving institutional investor returns. The fund will continue raising capital through the second quarter of 2013 and is anticipated to be fully subscribed.

According to Laurie Dotter, President of Transwestern, "Our partnership with Finesa has helped us reach our goal of becoming an international investment management platform." Diversified International Partners marks the first time that Colombian Pension Funds have invested in real estate in the U.S. through this type of discretionary format. "We are excited about this historic milestone for TIM, Finesa, and our institutional investors. Our goal is to continue broadening the reach of TIM's best in class expertise."

For more news and information visit Blumberg Capital Partners.

KPMG CRE Outlook Survey Results

KPMG LLP, the audit, tax and advisory firm, completed the 2012 KPMG Commercial Real Estate Outlook Survey with reflections and responses of nearly 80 senior executives in the commercial real estate industry. The survey found that CRE executives remain focused on efficiency and cost cutting as the commercial real estate market continues to rebound in a lackluster economy.

"Commercial real estate executives are seeing their margins and profits being squeezed, so increasing operational efficiency and reducing costs is a key focus," said Greg Williams, national leader of KPMG LLP's Building, Construction and Real Estate practice. "At the same time, there is tempered optimism as industry fundamentals continue to slowly improve and bright spots emerge... Commercial real estate execs are finding it challenging to source sufficient product that will produce the necessary yields to meet investor expectations. The gap between ask and bid price can still be significant in certain markets," said Williams. "It's also taking a lot longer to raise capital needed to grow their portfolios, while increased regulatory reporting requirements are driving up costs."

58% of the respondents expect the U.S. economy to improve next year, but they remain guarded about an economic recovery. In fact, 63% do not expect the economy to recover as a whole until 2014 or later - as opposed to 77% who, in the 2011 KPMG survey, predicted the recovery would be complete by the end of 2013.

For more news and information visit Blumberg Capital Partners.

Townsend Farms Buys Warehouse in Vineland

Vineland Development Corporation sold a 215,508 sq. ft. manufacturing and cross-dock warehouse building in Vineland, New Jersey this month for $2,100,000 according to a National Real Estate Investor article. In a deal brokered by Binswanger, Townsend Farms bought the property at 3501 South East Boulevard. Townsend Farms, which grows, processes, and delivers premium berries, plans to use the facility for processing and freezing fresh berries from local growers.

The building was originally constructed for the Rennoc Corporation as a garment manufacturing facility. A multi-million dollar renovation of the property will include raising the ceiling height in a portion of the building, adding freezer space as well as processing equipment. General Mills leases a portion of the building and will remain as a tenant.

For more news and information visit Blumberg Capital Partners.

Tucson Spectrum Sold for $125M

The Tucson Spectrum Shopping Center traded hands this month as DDR Corp., a publicly-traded investment trust, purchased the property from an affiliate of Barclay Group along with Creswin Properties Inc., both private commercial real estate companies. DDR Corp. purchased the 709,811 SF and seven developable finished retail pads of the Phase II portion of the regional retail center located at Irvington Road and Interstate 19 for $125,375,000.

"This transaction is the culmination of over a decade of meticulous planning and development, said Scott T. Archer, Managing Director of Barclay Group. "Our partners, relationships, and company's dedication were essential in creating this institutional quality asset. With the stabilization of the center and the improvement in market conditions, it proved to be an opportune time to sell. With DDR's reputation and proven track record, they provide a natural fit to ensure the future success of Tucson Spectrum."

According to a Phoenix Business Journal article, the project is roughly 94% leased and also includes seven development-ready plats, one of which is already under construction for an Old Navy location. DDR is already in discussions with other retailers for the remaining sites, said Jan Fincham, a principal with Lee & Associates who helped broker the deal along with Patrick Dempsey.

For more news and information visit Blumberg Capital Partners.