Top Stories

SL Green Realty to Sell West Manhattan Mixed-Use Tower, Adjacent Development Site for $446.5M

by John Nelson February 18, 2020

NEW YORK CITY — SL Green Realty Corp. (NYSE: SLG) has entered into a contract to sell a 36-story mixed-use tower and an adjacent undeveloped parcel in Manhattan for $446.5 million. An affiliate of Brookfield Asset Management (NYSE: BAM) is the buying entity for the 492,987-square-foot building at 315 W. 33rd St. on the borough’s west side. Also known as The Olivia, the mixed-use tower features 333 residential units and 270,132 square feet of commercial space. The residential portion is 96 percent occupied, and the commercial space is fully leased to tenants including AMC Theatres, Music Choice and Landmark Education. The Olivia’s community amenities include a residents’ lounge, laundry room, onsite parking, fitness center, bicycle storage, resident app, valet services, 24-hour lobby and rooftop terrace. The property is near Madison Square Garden, the Hudson River and Penn Station. Darcy Stacom of CBRE represented SL Green Realty in the sale transaction, which is expected to close in the second quarter. No details were released about Brookfield’s plans for the parcel. “This sale is another example of SL Green’s commitment to strategically divest of non-core assets and accretively redeploy the capital into our ongoing share repurchase program,” says David Schonbraun, co-chief investment …

February 18, 2020

Acquisitions California Office Top Stories Western

Shorenstein Properties Sells Santa Clara Towers Office Complex in Bay Area for $195M

by Taylor Williams February 17, 2020

SANTA CLARA, CALIF. — Shorenstein Properties LLC, an investment firm with offices in New York and San Francisco, has sold Santa Clara Towers, a 445,000-square-foot office complex. An affiliate of Hines purchased the property for approximately $195 million, according to The Mercury News, which covers the Bay Area. Santa Clara Towers comprises two 11-story buildings that are situated along U.S. Highway 101 in the Golden Triangle submarket of Santa Clara. The properties were built in 1986 and 1998. Shorenstein acquired the assets through a deed in lieu of a foreclosure transaction in 2010. Following the acquisition, Shorenstein introduced a number of capital improvements, including a full lobby renovation in Tower II. Amenities at Santa Clara Towers now include a fitness center, indoor pool and onsite restaurant. The property also offers proximity to a number of hotels, universities and the San Jose International Airport. Both buildings are LEED Gold certified. “I am confident that under new ownership, Santa Clara Towers will continue to attract a diverse mix of tenants who seek a Class A office experience in the heart of Silicon Valley,” said Jed Brush, senior vice president at Shorenstein. Russell Ingrum, Joe Moriarty, Scott Prosser and Jack DePuy of CBRE brokered the sale on behalf …

February 17, 2020

Development New York Northeast Office Top Stories

Moinian Group to Develop Hudson Arts Office Building in Manhattan’s West Chelsea District

by Alex Patton February 14, 2020

NEW YORK CITY — The Moinian Group will develop The Hudson Arts Building, a ground-up office construction project in the West Chelsea neighborhood of Manhattan. The 200,000-square-foot office tower is expected to rise up to 145 feet and will occupy an entire city block between West 25th and 26th streets at 220 11th Ave. The building is being developed on a speculative basis, with occupancy expected in the third quarter of 2022. JLL’s Peter Riguardi, Frank Doyle, Cynthia Wasserberger and Georgiana Cook are leading the leasing effort. “Office tenants, institutional investors, residents and commuters are recognizing the broader West Side’s vibrancy, distinguished by its industrialized roots and now marked by its unparalleled amenities and new projects across property types,” says Doyle, vice chairman, international director at JLL’s New York City office. “As a result, West Chelsea has emerged as a target destination for progressive companies and talent alike.” Designed by Studios Architecture, Hudson Arts Building will feature a 12,400-square-foot outdoor terrace and a multi-level level retail space totaling approximately 25,000 square feet. It will also include one of the larger newly built rooftop spaces in Manhattan. The site offers convenient access to several transit options, including the Highline, 23rd Street …

February 14, 2020

Acquisitions Life Sciences Massachusetts Northeast Office Top Stories

IQHQ Acquires Life Sciences Office, Lab Building in Boston’s Fenway for $270M

by Alex Tostado February 13, 2020

BOSTON — IQHQ Inc. has acquired 109 Brookline Avenue, a 285,000-square-foot office and lab building in Boston’s Fenway neighborhood. Equity Commonwealth sold the asset for $270 million. IQHQ, formerly Creative Sciences Properties, used funds from a $770 million capital raise to make the acquisition. The company, which specializes in life sciences real estate development, will use the rest of the funds to invest in life sciences projects in its core markets of Boston, San Francisco and San Diego in the United States, as well as the Golden Triangle in the United Kingdom (Cambridge, London and Oxford). “Boston’s amazing life sciences cluster keeps fueling demand for high-quality space,” says John Bonanno, chief investment officer of IQHQ. “109 Brookline checks a lot of boxes for us — it’s adjacent to Fenway Center, easily accessible by public transportation and in a neighborhood with a history of full occupancy and a bright future.” According to LoopNet Inc., the three-story building was originally developed in 1915 and renovated in 2000. The property is located along the corridor between Kenmore Square and the Longwood Medical Area, which is home to some of the country’s leading medical and research institutions. The property is situated two blocks from …

February 13, 2020

Acquisitions Office Texas Top Stories

Piedmont Office Realty Trust to Acquire Galleria Office Towers in North Dallas for $400M

by Kristin Harlow February 12, 2020

DALLAS — Piedmont Office Realty Trust Inc. (NYSE: PDM) is under contract to acquire Galleria Office Towers in Dallas for $400 million. Situated at the corner of the Dallas North Tollway and the LBJ Freeway in the Far North Dallas neighborhood, the three office buildings total 1.5 million square feet and were built between 1982 and 1991. The properties are also attached to Galleria Dallas, a shopping destination with over 140 stores and 40 restaurants, as well as the 432-room Westin Galleria Hotel. The seller, CBRE Global Investors, spent more than $20 million in capital improvements at the properties. Amenities include lounges, conference centers, a fitness center and rooftop terrace. Piedmont, an Atlanta-based REIT, listed the transaction in a Securities and Exchange Commission filing but did not disclose the property name. However, multiple local media reports identified the acquired asset. The transaction is expected to close this quarter. JLL marketed the Galleria portfolio for sale. It is nearly 90 percent leased to tenants such as Amazon, Ryan LLC, Ansira Partners, Kimley-Horn and Hospital Corp. of America. Piedmont owns several office buildings in the Dallas market, including Park Place on Turtle Creek and One Lincoln Park. Other markets the firm targets …

February 12, 2020

California Development Healthcare Loans Top Stories Western

Gantry Secures $703M Construction-to-Permanent Financing for VA Medical Office Portfolio

by John Nelson February 11, 2020

SAN FRANCISCO — Gantry, an independent mortgage banking firm based in San Francisco, has secured $373 million in construction financing and $330 million in permanent financing for a six-property medical office building portfolio. The properties in the portfolio are Veterans Affairs (VA) medical clinics located in San Diego, Chula Vista and Redding, Calif.; New Port Richey, Fla.; and Tulsa, Okla. The sixth property is in an undisclosed, confidential location. George Mitsanas and Peter Hillakas of Gantry’s Los Angeles office arranged the construction-to-permanent financing on behalf of the undisclosed borrower through a pension fund. Mitsanas says the borrower was a first-time sponsor with Gantry. “We were engaged prior to the lease award for each of these assignments, and that allowed us to help assess the feasibility of each project and craft a financing structure, which resulted in our clients winning multiple lease awards from the federal government,” says Mitsanas. Gantry will service both the construction and permanent loans. Details of the financing were not disclosed, but Mitsanas says the permanent financing will mature in 22 years. According to local officials where the projects are located, the portfolio will generate several thousands of construction and permanent jobs once the facilities open in …

February 11, 2020

Acquisitions Retail Top Stories

Simon Property Group to Acquire Majority Interest in Taubman Centers for $3.6B

by Taylor Williams February 10, 2020

INDIANAPOLIS — Simon Property Group (NYSE: SPG) has agreed to acquire an 80 percent interest in Taubman Centers Inc. (NYSE: TCO), a Michigan-based retail owner-operator, for approximately $3.6 billion. Under the terms of the agreement, Simon is buying all of Taubman’s common stock at a price of $52.20 per share in an all-cash deal. The transaction is expected to close in mid-2020. The purchase price represents a 51 percent premium over Taubman’s closing price of $34.67 per share on Friday, Feb. 7. Taubman’s existing debt, which Simon will assume, was factored into the price, which represents a capitalization rate of 6.2 percent. Taubman will continue to operate as a separate entity. Taubman’s portfolio spans 26 super-regional malls and power centers totaling more than 25 million square feet of gross leasable space in the United States and Asia. “By joining together, we will enhance the ability of Taubman to invest in innovative retail environments that create exciting shopping and entertainment experiences for consumers, immersive opportunities for retailers and substantial new job prospects for local communities,” says David Simon, CEO of Simon Property Group. Simon Property Group’s stock price opened at $142.11 per share on Monday, Feb. 10, down from $185.30 per …

February 10, 2020

Company News Development Industrial Midwest Office Ohio Top Stories

Sherwin-Williams to Develop World Headquarters, R&D Center in Metro Cleveland for $600M

by Alex Tostado February 7, 2020

CLEVELAND AND BRECKSVILLE, OHIO — The Sherwin-Williams Co. (NYSE: SHW) plans to develop a new world headquarters building in downtown Cleveland, as well as a research and development (R&D) center in the Cleveland suburb of Brecksville. The company plans to invest $600 million to construct both facilities. The paint manufacturer and retailer’s headquarters building will span 1 million square feet just west of Public Square between Saint Clair and Superior avenues. The R&D center will span 500,000 square feet and will be located off Interstate 77 at Miller and Brecksville roads, 16 miles south of downtown Cleveland. The transition to the new facilities won’t occur until 2023 at the earliest, the company says. Sherwin-Williams previously launched a nationwide search for its new headquarters location before deciding to stay in Ohio, where it has been based since it was founded in 1866. “We currently operate out of a 90-year-old headquarters building that has served us well but is no longer conducive to meeting our future needs,” says John Morikis, the company’s chairman and CEO. “The major planned investment in Cleveland and Northeast Ohio we are announcing today reflects our confidence in the continued strength of the region and its people and …

February 7, 2020

Development Georgia Multifamily Southeast Top Stories

Crescent Communities Developing 339-Unit Novel Midtown Apartment High-Rise in Atlanta

by Alex Patton February 6, 2020

ATLANTA — Crescent Communities, a North Carolina-based developer, has started construction of Novel Midtown, a 339-unit multifamily high-rise building in the Midtown neighborhood of Atlanta. The 14-story, 360,000-square-foot tower will feature studio, one-, two- and three-bedroom units with private balconies. Amenities include 814 parking spaces, a fitness center, pet spa, coffee bar, saltwater pool and sky deck. The ground floor will offer 15,000 square feet of retail space. Completion is slated for spring 2022. Greenstone Properties is developing a 310,000-square-foot office tower with street-level retail space adjacent to the Novel Midtown site. The location is also near a 70,000-square-foot Whole Foods Market, the Woodruff Arts Center, High Museum of Art and Museum of Design Atlanta. “We are excited about the opportunity that this amazing location provides for us to create an upscale living experience,” says Kyle Brock, managing director for the Georgia region of Crescent Communities’ multifamily business. “Midtown is a sought-after destination to live, work and play.” Niles Bolton Associates is the project architect for Novel Midtown. Ironwood Design Group is the landscape architect and Vignette Interior Design is the interior architect. Balfour Beatty is the general contractor. The Carlyle Group and Santander Bank are financing the project, though …

February 6, 2020

New York Northeast Retail Top Stories

Macy’s to Close 125 Stores, Consolidate Headquarters in New York City

by Kristin Harlow February 5, 2020

NEW YORK CITY — Macy’s Inc. (NYSE: M) has unveiled plans to close 125 of its least productive stores over the next three years. The retailer will also close its offices in San Francisco, downtown Cincinnati and Lorain, Ohio, leaving the New York City office as the sole corporate headquarters. The reorganization strategy also includes increasing the Macy’s digital platform, while optimizing its brick-and-mortar portfolio and lowering overhead costs. Beginning this year, Macy’s expects the strategy to generate annual gross savings of approximately $1.5 billion, to be fully realized by year-end 2022. “We will focus our resources on the healthy parts of our business, directly address the unhealthy parts of the business and explore new revenue streams,” says Jeff Gennette, chairman and CEO of Macy’s. “Over the past three years, we have shown we can grow the top line; however, we have significant work to do to improve the bottom line.” The 125 stores that Macy’s plans to close account for approximately $1.4 billion in annual sales and one-fifth of its store footprint. Thirty of the stores are in the process of closure now. Steve Horwitz, a professor in the Miller College of Business at Ball State University in Muncie, …

February 5, 2020

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