the Editors of Commercial Property Executive
Chicago Market Quiets, But Not Silent Yet
Despite an overall bleak picture for Chicago’s industrial and office product, the market is still seeing activity. Over the past few days, the city has seen both an industrial lease deal and the announcement of an office development, but such deals are becoming a rarity rather than the norm. Bristol Group Inc. agreed to terms on a lease with PODS of Chicago, which will occupy some 81,250 square feet of warehouse and distribution space in recently constructed 11240 Katherine’s Crossing, a facility located within Wood Hill Crossings Business Park in Woodridge, Ill. With the PODS lease, Bristol Group has now…
Big Deals Continue with Sale of 3.4M-SF Portfolio in U.K.
In a real estate investment market that has been quieted by the credit crunch and staggering economy, a spate of major deals over the past week may be an early sign that activity could be picking up in the near future. But an uptick in sales does not necessarily mean the industry is returning to health; many of the sales are being made by owners desperate for cash to repay debt and shore up balance sheets, as well as creditors that have seized property back from borrowers that have defaulted.The latest such deal took place in the United Kingdom, where…
NY Times to Put a Dent in Debt with $225M Sale-Leaseback of Midtown Headquarters
With the real estate market in a slump, property owners in sale-leaseback deals aren’t walking away with as much money as they would have just a few years ago, but they can still get a relatively sizeable chunk of change, just as the New York Times Co. will in its arrangement with investment management firm W. P. Carey & Co. The newspaper concern just entered into a sale-leaseback agreement involving the 750,000 square feet of office space it owns and occupies in the 1.5 million-square-foot Midtown Manhattan building at 620 Eighth Ave. For W. P. Carey, the deal means adding…
Economic Update-Where’s the Bottom of That Cliff?
Recession, depression, panic–or “fallen off a cliff”? Warren Buffet, speaking with CNBC’s Squawk Box on Monday, likened the U.S. economy to Wile E. Coyote, or at least to his propensity for falling from steep precipices. “Not only has the economy slowed down a lot, but people have really changed their habits like I haven’t seen,” he said. Things will get worse before they get better, the highly visible billionaire added, but eventually they will get better (it could take as long as five years, though). “Everything will be all right,” he said. “We do have the greatest economic machine that…
1540 Broadway Deal a Manhattan Rarity
With big property trades as rare hen’s teeth in Manhattan these days, the sale of the office portion of 1540 Broadway in Midtown for a heavily discounted price–rumored at $355 million–is sending ripples through the city’s investment market. Disclosed by CB Richard Ellis Investors, which made the purchase on behalf of a commingled international fund, the sale is one of only four significant Manhattan office trades confirmed so far this year. Some $775 million in office assets have change hands so far in 2009, about half the $1.6 billion volume tallied during the same period in 2008, according to Real…
Spitzer’s $180M D.C. Buy Offers Glimpse of the Future
Last week’s $180 million sale of a Washington, D.C., office building made national headlines because Eliot Spitzer worked on the deal. But the trade was more noteworthy for what it says about things to come in commercial real estate investment. Forced to resign as New York’s governor a year ago because of a scandal, Spitzer worked to structure the transaction with his father Bernard, a long-time developer and investor. A company controlled by Bernard Spitzer bought 1615 L Street, a 418,000-square-foot office building located four blocks from the White House. The seller, Broadway Partners, has encountered much-publicized difficulties tied to…
Texas Colleges Building for the Future with Construction Projects
As unemployment numbers continue to rise, some of those left jobless are returning to colleges and universities for training for a new trade or simply to make themselves more competitive in their job search. Universities are also repositioning themselves in places such as Texas, where colleges have a number of expansion projects on tap. The next 24 months at the University of Texas Dallas campus in the Dallas suburb of Richardson will bring more than $130 million in new projects including new classrooms, a student residence and dining hall as well as a campus landscape project that will change the…
Economic Update — Bye Bye, Circuit City
Sunday was the last day of business for former electronics giant Circuit City, which could well become a lesson for business school students of the future in how to fail as a big, even category-dominating, retailer. The recession, of course, was a large nail in its coffin, but other nails were supplied by the company itself: bad real estate decisions, bad merchandising decisions, and the infamous decision only two years ago to toss its best salespeople and replace them with cheaper hires of questionable quality. The closing day represented an accelerated liquidation pace for Circuit City, so much so that…
The Four R’s: Survival Tactics for Owners of Real Estate
Every day, headlines announce the crumbling of yet another once-iconic partner. Bankruptcies are flourishing, and the ultra-complex financial structures of recent deals are quickly unraveling. The situation is made more difficult because there is no familiar context. The “go-to” investment banks are gone, double-digit unemployment is a global issue, foreign capital has either evaporated or become extremely cautious, tenants are contracting at a frightening rate, construction has stopped mid-crane and there are simply no transactions. Real estate companies and other businesses with substantial real estate holdings–such as retailers, hotel companies, healthcare entities and other orporations–are challenged by an unprecedented need…
Economic Update — Cautious Optimism About TALF
Will TALF–the Term Asset-Backed Securities Loan Facility, in case anyone’s forgotten–bring the securitization of loans, especially non-agency RMBS and CMBS, back to life in any meaningful way? The program will get under way on March 25, and Wall Street is keeping a close eye it. And so are players in some real estate niches that used to obtain much of their capital from securitizations.”Over 70 percent of loans in the tenant-in-common business were originated through securitized product, and when that evaporated last year, it created a great hardship for TICs,” Bill Winn, president of the Tenant-in-Common Association and president of…