Business Specialties

Infrastructure like toll roads, bridges, wastewater treatment facilities and the like does not precisely count as real estate, though it is a physical asset that produces a revenue stream, so the difference may be only academic. Infrastructure deals are not exactly net lease structures, either, but here, too, are similarities. When an investor “buys” a bit of infrastructure, it is usually leasing the property under a very long-term lease with the right to the long-term revenue stream in return for a boatload of cash paid upfront to the “seller.”However one categorizes infrastructure deals, they seem to be catching on in…

Back in January 2008, long before the capital markets took their astonishing twists, Fitch Ratings made a sobering prediction: By the end of the year, its CMBS loan delinquency index would be double or triple the 0.28 percent recorded at the end of 2007. Fitch’s crystal ball turned out to be right on the money. On Friday the ratings agency reported that CMBS delinquency reached 0.64 percent for November. At this pace, Fitch projects that CMBS delinquencies could hit 2 percent by the end of 2009.A bad month or two does not necessarily make a trend, and Fitch often notes…

Nationwide Financial Network has finalized the sale and partial leaseback of its corporate office at 300 Continental Drive in Newark, Del. Nationwide was represented by CB Richard Ellis Inc. in the deal. The three-story, 160,000-square-foot Class A office building is located on 22 acres of land. The buyer, Sallie Mae, purchased the property for $20.75 million and will leaseback 72,000 square feet to Nationwide for a term of one year.The property is within close proximity to hotels, restaurants, shopping and mass transit and is approximately eight miles from both the New Castle County Airport and the Newark Amtrak Station and…

In the first decline since July in the delinquency rate among U.S. commercial real estate loan collateralized debt obligations, that rate fell from 3.13 percent in October to 2.80 percent in November, according to the latest information from Fitch Ratings.Fitch currently rates 35 CREL CDOs comprising about 1,100 loans and 370 rated securities/assets with a balance of $23.8 billion. “The continued lack of available capital is driving maturity defaults of CRE loans,” Fitch senior director Karen Trebach said in a prepared statement. “However, asset managers are continuing to extend many of these loans, with the extension of two large performing…

Cole Credit Property Trust III has kicked off a public offering of up to 250 million shares of common stock valued at approximately $2.5 billion. Net proceeds from the offering will be primarily earmarked for the acquisition of net leased retail properties. The REIT is offering up to 230 million common-stock shares at $10.00 per share. It can also tender up to an additional 20 million common-stock shares with a price tag of $9.50 per share for issuance under its distribution reinvestment program. Cole Capital Corp., a segment of investment firm Cole Real Estate Investments, will manage the 250 million…

AG Net Lease, the net lease arm of  Angelo, Gordon & Co., has acquired five of Consolidated Container Co.’s, manufacturing and distribution facilities located in three states for $34.3 million. The properties are located in: Santa Ana, Calif.; Tracy, Calif.; Baltimore; Elizabeth, N.J.; and Monroe, N.J.  “Like other financing alternatives, the availability of capital for sale-leasebacks is severely constrained today,”  Gordon Whiting, founder & chief portfolio manager of AG Net Lease, noted in a release. “As this deal shows, we continue to close complex transactions with leading sponsors and their portfolio companies. We will remain very active closing sale-leasebacks in…

The credit freeze has slowed direct investment in commercial real estate everywhere in the world, but in some places sale-leaseback activity is picking up some of the slack.That’s one of Jones Lang LaSalle Inc.’s conclusions in its “H12008 Global Real Estate Capital Report.” The latest trend in sale-leasebacks comes in the wake of rapid growth in that form of corporate finance worldwide in the past few years. In the first six months of 2005, sale-leasebacks formed $10.4 billion of the total investment transaction volume internationally. That figure rose to $20.7 billion in the first half of 2006 and to $30.7…

The credit freeze that came with the Panic of 2008 this fall has put the sale-leaseback business in a peculiar bind. Because obtaining financing is more difficult than it used to be, companies that happen to own real estate are looking ever more closely at the possibility of unlocking that capital via a sale-leaseback.The problem is that the pool of potential buyers for such properties has shrunk, and the remaining players are finding it hard to finance deals. Andrew Sandquist, senior vice president for the Oak Brook, Ill., office of CB Richard Ellis Inc. and a net lease investment specialist…

CPN Contributing Editor Dees Stribling caught up with William Winn— president-elect of the Tenant-In-Common Association and president & partner in Passco Cos., a specialist in commercial real estate acquisition and management that in recent years has also developed a thriving subspecialty in sponsoring TIC deals. Like pretty much every corner of the real estate industry, TICs have seen better days, but Winn holds out long-term hope.CPN: Next year is going to be another tough year for TIC deals, isn’t it?Winn: Properties aren’t performing as well as they were, and I expect that to continue into 2009, so we’re having the…

Last week’s move by the Federal Reserve to trim a benchmark interest rate may have only a modest impact on its own. But any steps that can ease the credit squeeze or stabilize investor confidence can only help in the long run, says William Hughes, senior vice president & managing director of Marcus & Millichap Capital Corp., the capital markets affiliate of Marcus & Millichap Real Estate Investment Services Inc. “I think the Fed is trying to play every card it possibly can,” Hughes told CPN. Lowering the federal funds rate from 1.5 percent to 1 percent is partly intended…