Top Stories

Children’s Healthcare of Atlanta to Build $1B Pediatric Hospital at Campus in Brookhaven, Georgia

by Kristin Harlow February 10, 2017

BROOKHAVEN, GA. — Children’s Healthcare of Atlanta (CHOA) has unveiled plans to build a new pediatric hospital in the Atlanta suburb of Brookhaven. CHOA’s total investment in the new hospital will be between $1 billion and $1.3 billion, according to the company. After construction of the new hospital is complete, CHOA will cease operations at the inpatient facility at Egleston Hospital in Atlanta. Future plans for the use of the Egleston campus have not been determined. The new project will join a medical campus at North Druid Hills Road and I-85 that will also include CHOA’s previously announced Center for Advanced Pediatrics. Construction of that 260,000-square-foot outpatient facility began last month. Based on studies of future demand and facility capacity, CHOA believes that the new, 45-acre campus will be able to meet forecasted patient care and space needs through 2026. Specific transportation, site and building plans for the campus will be developed over the next 18 months. The area is quickly becoming a new medical corridor for suburban Atlanta, as Emory Healthcare and the Atlanta Hawks unveiled plans for a nearby $50 million training and sports medicine center last year. —Kristin Hiller

February 10, 2017

Civic New York Northeast Top Stories

Lendlease-Turner Joint Venture Awarded $1.5B Expansion of Javits Center in Manhattan

by John Nelson February 9, 2017

NEW YORK — Empire State Development Corp. has selected a design-build team led by Lendlease Construction LMB Inc. and Turner Construction to oversee the $1.5 billion expansion of the Jacob K. Javits Convention Center in New York City. The team also includes Atlanta-based architect tvsdesign, which is aiming for the center’s expansion to be certified LEED Silver. Named after a former U.S. Senator from New York, the conference center is located on 11th Avenue in Manhattan’s Westside and bills itself as the busiest convention center in the country. The venue hosted events on 337 days in 2015. The six-block convention center opened in 1986 and spans 2.1 million square feet, of which 840,000 square feet is exhibition space. According to media reports, the Lendlease-Turner team is planning on a 46-month construction schedule for the expansion. The expansion will add 90,000 square feet of permanent space to the center’s current exhibit space, which will create an approximately 500,000-square-foot exhibition hall. Additionally the project will include 45,000 square feet of meeting room space and a 55,000 square-foot ballroom, the largest of its kind in New York City. The expansion will also reroute 20,000 event-related trucks off area streets each year, which is …

February 9, 2017

Features Office Top Stories

U.S. Office Sector’s Fundamentals Stall Despite Growing Economy, Says Ten-X Research

by John Nelson February 9, 2017

IRVINE AND SILICON VALLEY, CALIF. — The U.S. office real estate sector’s fundamentals appear to be stalling after years of slow recovery, as vacancy rates remain stubbornly high despite a healthy labor market and growing national economy, according to Ten-X’s latest U.S. Office Market Outlook. Ten-X cited Reis data that shows the national vacancy rate for office space has held steady at 16 percent for three consecutive quarters. Vacancies are now 40 basis points lower than a year ago and 160 basis points below their cyclical peak, but they remain well above levels seen during the last economic cycle. Only 70 million square feet of new supply has been occupied during each of the last two quarters. Rent growth has hit a similar slump, with effective rents edging up just 0.4 percent in the third quarter of 2016 and 2.8 percent over the past year — the slowest annual growth since mid-2014. The downturn in office fundamentals comes despite a strong labor market that continues to add jobs and a steadily expanding economy. Low unemployment, consistent payroll gains and rising wages should offer a boost to overall demand for office space, though the national economic picture is marked by stark differences among markets …

February 9, 2017

Industrial Midwest Texas Top Stories

DRA Advisors Buys 19.8 MSF National Industrial Portfolio for $1.1B

by Nellie Day February 8, 2017

NEW YORK — DRA Advisors has purchased a 19.8-million-square-foot industrial portfolio that spans 21 U.S. markets for $1.1 billion. The portfolio contains a total of 184 properties that are 94 percent leased to more than 500 tenants. The properties reside in industrial hubs such as Dallas, Houston, Chicago, Atlanta and Columbus, Ohio. The assets range from less than 15,000 square feet to 925,000 square feet, according to CoStar Group. Cabot Properties Fund II sold the portfolio, concluding the fund’s disposition activity. The fund was launched in late 2005. This acquisition will allow New York-based DRA Advisors to expand its industrial footprint to more than 45 million square feet. DRA’s industrial assets are primarily located in Texas, California, Illinois, Indiana and Florida. The private equity real estate firm currently has more than $10 billion of assets under management. This includes more than 70 million square feet of commercial real estate and more than 12,000 residential units. Eastdil Secured and Cushman & Wakefield represented Boston-based Cabot Properties in the transaction. The private equity real estate firm manages and operates about 160 million square feet of industrial properties throughout North America and the United Kingdom that are valued at $57 billion. — Nellie Day

February 8, 2017

Hawaii Hospitality Multifamily Top Stories Western

Salem Partners, Mandarin Oriental to Open 36-Story Luxury Hotel, Multifamily Tower in Honolulu

by Kristin Harlow February 7, 2017

HONOLULU — Salem Partners has partnered with Mandarin Oriental Hotel Group to build Mana’olana Place, a hotel and multifamily property currently under development in Honolulu. The development is slated to open in early 2020. The 36-story, 743,000-square-foot tower will be located in the Ala Moana District at the intersection of Kaipolani Boulevard and Atkinson Drive. Mana`olana Place is the first approved project in the city’s new Ala Moana transit hub. The Mandarin Oriental, Honolulu hotel will consist of 125 guestrooms and suites. The tower’s upper floors will consist of 107 private homes. The property will feature a rooftop restaurant and bar with landscaped outdoor terraces and gardens. The hotel will also feature a spa with eight treatment rooms, a fitness center and an 80-foot outdoor swimming pool. Colorado-based [au]workshop is the design architect on the project, while Architects Hawaii Ltd. will serve as the executive architect. The design team also includes Dianna Wong Architects + Interior Design and Hart Howerton Landscape Architects. Salem Partners is a Los Angeles-based investment bank and wealth management firm. Mandarin Oriental operates 29 hotels and eight residences in 19 countries and territories. —Kristin Hiller

February 7, 2017

Features Top Stories

Property Insurance Forecast for 2017: Reinsurance Industry Keeps Clouds Away

by John Nelson February 7, 2017

As commercial property owners renew their insurance programs in 2017, they’ll be pleasantly surprised to see their property premiums continue to decrease. Those owners can thank favorable meteorological and financial conditions for their good fortune. Florida hasn’t been hit by a major hurricane in more than a decade. Hurricane Matthew skirted much of Florida’s coast, ultimately wreaking damage and disruption in Jacksonville, but overall, had a relatively small impact on the state and the insurance industry as a whole. Insurers have enjoyed the good weather, which has attracted more competitors to the state at the primary and reinsurance levels, while better technology and predictive modeling have driven property catastrophe (CAT) coverage closer to a commodity, making it difficult for existing carriers to firm up rates, let alone drive increases. Weathering the Storm Even if we were to experience major storms in 2017, the effects of any jolt would be contained. As carriers begin the new year with significant surplus in their coffers and the January treaty renewals wrapping up, initial reports point to another year of declining reinsurance costs. For carriers, the cost of capital has declined materially for years and their ability to strike a better deal has cascaded down …

February 7, 2017

Multifamily Top Stories Washington Western

Kennedy Wilson Acquires 282-Unit Multifamily Community in Seattle for $141M

by Jeff Shaw February 6, 2017

SEATTLE — A joint venture between real estate investment company Kennedy Wilson (NYSE: KW) and an undisclosed partner has acquired Radius, a 282-unit multifamily community in Seattle’s South Lake Union submarket, for $141 million. Radius is a class-A apartment community built in 2015. Amenities include two rooftop decks, gaming room, fitness center and a private resident media room. The seller was not disclosed. Radius is located directly across the street from the world headquarters and main campus of Amazon and walking distance to over 10 million square feet of additional Amazon office space. The property is also within walking distance of employers such as Facebook, the Fred Hutchinson Cancer Research Center and a future 607,000-square-foot Google campus. The 50/50 joint venture invested $72 million of equity for the purchase, drawing from its recent $58 million sale of The Grove, a 331-unit community in San Jose, Calif. The partnership also secured a 10-year acquisition loan of $70 million. The financing features a fixed interest rate of 4.06 percent and interest-only payments for the first five years. “Radius is an exciting addition to our Seattle apartment portfolio,” says Shem Streeter, managing director of Kennedy Wilson Multifamily Investments. “Seattle’s South Lake Union neighborhood features some of …

February 6, 2017

Florida Retail Southeast Top Stories

InvenTrust Acquires Paraiso Parc and Westfork Plaza in Pembroke Pines, Florida, for $163M

by Kristin Harlow February 3, 2017

PEMBROKE PINES, FLA. — InvenTrust Properties Corp. has acquired Paraiso Parc and Westfork Plaza retail centers in Pembroke Pines for $163 million. The two adjacent centers are located approximately 20 miles north of Miami. Upon completion of an ongoing expansion project in mid-2017, the two centers will total approximately 389,000 square feet. The properties include national tenants such as Publix, Costco, Regal Cinemas, Ross and TJ Maxx. “The acquisition of Paraiso Parc and Westfork Plaza represents a truly unique opportunity to secure an A+ asset in one of South Florida’s strongest retail submarkets,” says Michael E. Podboy, CFO at InvenTrust. InvenTrust is a self-managed REIT that owns and manages 88 retail properties totaling 15.1 million square feet of retail space. —Kristin Hiller

February 3, 2017

Kentucky Midwest Ohio Southeast Top Stories

Amazon to Open New $1.5B Air Cargo Hub at Cincinnati/Northern Kentucky Airport

by John Nelson February 2, 2017

HEBRON, KY. — Amazon (NASDAQ: AMZN) plans to build a centralized air hub at the Cincinnati/Northern Kentucky Airport (CVG) in Hebron to support its fleet of Prime Air cargo planes. The Seattle-based company expects to create more than 2,000 new jobs at the new $1.5 billion facility. “As we considered places for the long-term home for our air hub operations, Hebron quickly rose to the top of the list with a large, skilled workforce, centralized location with great connectivity to our nearby fulfillment locations and an excellent quality of living for employees,” says Dave Clark, Amazon’s senior vice president of worldwide operations. Last year, Amazon entered into agreements with Atlas Air Worldwide and Air Transport Services Inc. to lease 40 cargo airplanes to support members of its Prime program, which offers its members free two-day shipping. Sixteen of those cargo planes are currently in service, and the e-commerce giant plans to roll out more planes over time. Amazon’s Prime Air hub at CVG will support Amazon’s fleet of Prime Air cargo planes by loading, unloading and sorting packages. “We’ve worked hard to ensure CVG is a great place to do business, and we couldn’t be more pleased that Amazon recognized …

February 2, 2017

Features Industrial Southeast Feature Archive Top Stories

Southeastern Ports Adjust to Expanded Panama Canal

by Jeff Shaw February 2, 2017

The Southeast’s top seaports and their surrounding industrial real estate markets have braced themselves for years for the larger post-Panamax vessels that can now pass through the newly expanded Panama Canal. The 102-year-old canal opened in late June 2016 following its $5.4 billion expansion, creating a shortcut for the larger ocean carriers coming from Asia. The opening of Panama Canal’s expansion was delayed by two years, missing the 100-year anniversary of its 1914 debut. Shipping companies had their larger vessels in place, though, and decided to ship those vessels to the East Coast via the Suez Canal, according to Walter Kemmsies, managing director, economist and chief strategist of JLL’s U.S. Ports, Airports and Global Infrastructure Group. “As the Panama Canal gets through the learning curve, we’re seeing the number of weekly transits increase, and we’re still in that phase and perhaps will be for the next six months,” says Kemmsies, who is currently engaged with three of the top five seaports in the United States on their master plans. “The ocean carriers are starting to scrap their smaller vessels and moving their services back from the Suez Canal to go through the Panama Canal. Right now the East Coast has …

February 2, 2017

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