the Editors of Commercial Property Executive
Economists, Finance Leaders Take Capital Markets’ Pulse at Manhattan Conference
How the global financial system got to its current state–and prospects for commercial real estate capital markets–took center stage Monday at a capital markets conference in Manhattan sponsored by the law firms Goodwin Procter L.L.P. and SJ Berwin L.L.P. In the keynote addresses that bookended a morning of panel discussions, two leading economists offered an historic perspective, warned against impatience and offered suggested plans of attack. “Bailouts are only part of the story, folks,” said Carmen Reinhart, a professor of economics at the University of Maryland, during her opening keynote address. “The longer it takes to solve problems, the higher…
Report: Climate Change Puts California Real Estate, Economy at Risk
While the real estate sector continues to take a beating by economic forces, there may be yet another peril on the horizon that could harm the industry just as much–if not more. According to a new report by the University of California, Berkeley, the state of California currently has a total of $2.5 trillion in real estate assets at risk from “extreme weather events,” such as wildfires and rising sea levels. That figure represents more than half of the $4 trillion in total real estate assets in the state, according to the report, which was released in the wake of…
At CPN Conference, Local Leaders Offer To-Do List for NYC’s Future
At CPN’s annual New York City Investment conference on Friday, speakers offered a vision of the nation’s largest commercial real estate market that blended sober realism with an occasional dash of clear-eyed optimism. “For the next 36 months, there will be a lot of wailing and gnashing of teeth,” predicted David Arena (pictured), president of Grubb & Ellis Co.’s New York City regional office, during a debate on the city’s future. He ticked off the troubling particulars: declining demand for office space, lower asset values, high financing costs. But Arena also reminded the roomful of real estate professionals gathered at…
Chandan: Economy to Contract Through 2009
The fiscal turmoil that continues to beleaguer the U.S. financial markets presents a lackluster near-term outlook: The economy is expected to shrink for the remainder of the year and during the first half of 2009 before experiencing just modest growth in late 2009 and in 2010, said Reis Inc. chief economist Sam Chandan, Ph.D., during the firm’s third quarter 2008 quarterly briefing. The number of job losses has grown markedly worse. The Labor Department last week announced that U.S. jobless claims rose by 32,000 to 516,000 for the week ended Nov. 8, its highest mark since September 2001. The weak…
Hypo Loses $4B in Third Quarter, G20 Summit Lacks Action
Commercial real estate woes aren’t limited to the United States. German lender Hypo Real Estate reported Monday a net loss of $4 billion in the third quarter as the financial crises worsened, with a unit in Ireland hit especially hard by write-downs on the values of its assets, the Associated Press reported. The Munich-based bank, which got a $63 billion bailout from the government last month, said it wrote down $3.1 billion in the third quarter and that it foresees “further negative impacts on earnings in the fourth quarter of 2008 and in 2009.” The Munich-based company had already said…
Financial Market Update – A Tough Day for The Ultrawealthy
The Dow Jones index started down, bumped up a little, then went down again, and then… the usual undulations, in other words. By the end of the day, however, the Dow was down 233.73 points, or 2.63 percent. The S&P 500 dropped 2.58 percent and the Nasdaq was down 2.29 percent. Citigroup Inc. has unveiled plans to eliminate 50,000 jobs, or about 14 percent of its workforce, in the wake of four quarterly losses in a row totaling some $20 billion. The market was unimpressed: Citi stock fell in the morning, but rose toward noon back near where it started,…
COPT Breaks Ground on Maryland Office Project
Corporate Office Properties Trust has broken ground on the first office building at North Gate Business Park located adjacent to the Aberdeen Proving Ground in Harford County, Md. COPT will soon start a second building at the site. The 80,000- to 85,000-square-foot buildings will cost an estimated $16.5 million each, for a total of $33 million. Planned to accommodate 765,000 square feet of office space, North Gate is among the first office parks being developed expressly to service defense contractors moving to Maryland in connection with the 2005 Base Realignment and Closure Act (BRAC). “This couldn’t come a better time…
D.C. Office Project Nets $194M in Financing
Even as credit markets remain largely frozen, some financing deals are still getting done, even very large scale loans. Case in point; the $194 million that developer Connecticut & K Associates L.L.C. just landed for the construction of 1000 Connecticut Avenue, a 12-story, 383,000-square-foot office building planned for Washington, D.C. A consortium of lenders headed by Chevy Chase Bank provided the financing, which was arranged on behalf of the borrower by the team of Philip Mudd, Christian Miles and Jon Goldstein of Cassidy & Pinkard Colliers. The term of the loan is 54 months. 1000 Connecticut (pictured) is located in…
Seattle Developer to Build 6 Casino Resorts in Guatemala
An affiliate of Seattle-based Alekson Development Group has signed an agreement with the Guatemalan Gaming Agency that will allow the company to build six casino/hotel/golf destination resorts over the next 10 years. Fin City Associates is based in Guatemala City and will be starting first on the resort there, with a second phase to consist of developments in Puerto Quetzal, on the Pacific coast, and in Antigua, in the central highlands. Resorts on Lake Atitlan in the southwestern highlands, a volcanic lake that is Central America’s deepest lake, and in Puerto Barrios on the Caribbean coast and in Panajachel on…
Brookfield Inks World Bank to 227,000-SF Lease in D.C.
The World Bank Group has agreed to a 10-year lease with Brookfield Properties Corp. that will allow the international organization to occupy all of the office space–227,000 square feet–at 1225 Connecticut Ave., N.W. in Washington, D.C. The group plans to move into the property during the late winter or early spring of 2010. Paul Schulman, Simon Carney and Eddie Trujillo represented Brookfield internationally. Zeke Dodson, Brian Daly and Laurie McMahon of Cassidy & Pinkard Colliers represented the tenant in the deal.Brookfield renovated and redeveloped the 30-year-old property over the past two years, investing $32 million in the project. The eight-story,…