Top Stories

GE Opens First Phase of $400M Advanced Manufacturing Works Plant in South Carolina

by Nellie Day April 25, 2016

GREENVILLE, S.C. — GE (NYSE:GE) has opened the 125,000-square-foot Advanced Manufacturing Works (AMW) plant in Greenville. AMW is GE Power’s first advanced manufacturing facility. The facility will serve as an incubator for the development of advanced manufacturing processes and rapid prototyping of new parts for GE’s energy businesses. These include power, renewable energy, oil and gas, and energy connections. GE has invested $73 million in the facility to date and will invest another $327 million across the GE Power Greenville campus over the next several years. The new facility created approximately 80 engineering and manufacturing jobs, according to GE. The company broke ground on the facility in mid-2014. “This facility will ignite the digital industrial revolution for our company and the industry,” says Steve Bolze, GE Power’s president and CEO. “We’re building a skilled workforce and culture that’s devoted to delivering breakthrough innovations that deliver better, faster outcomes for our customers and unlock new productivity and growth.” GE entered the Greenville market more than 40 years ago with a 340,000-square-foot property. That site has now grown close to 1.7 million square feet of factories, offices and laboratories focused on manufacturing advanced products for worldwide distribution. GE has more than 3,200 …

April 25, 2016

Industrial Top Stories

W. P. Carey Acquires 49-Property Industrial Portfolio in Sale-Leaseback Transaction for $217M

by Christina Cannon April 22, 2016

NEW YORK CITY — W. P. Carey Inc. (NYSE: WPC) has acquired a 4 million-square-foot industrial portfolio for $217 million. The portfolio consists of 43 assets in the United States totaling 3.5 million square feet and six properties in Canada totaling 500,000 square feet. The buildings were purchased in a sale-leaseback transaction with wholly owned subsidiaries of Forterra Building Products, a manufacturer of concrete and clay building products. The properties each feature a 20-year triple net lease that includes fixed annual rent escalations of 2 percent. The facilities include offices, concrete manufacturing, concrete quality control testing and storage facilities. “Providing steady, predictable cash flows, compelling returns and annual rent escalations, the investment is also supported by the long-term lease and the strength of Forterra’s guarantee,” says Gino Sabatini, managing director and head of net lease investments for W. P. Carey. “Consistent with our established investment criteria, we believe the acquisition is a sound addition for W. P. Carey Inc.’s portfolio, which extends its weighted average lease-term and is accretive to cash flow.” Brian Scott and Andrew Sandquist of CBRE represented Forterra in the transaction. New York-based W. P. Carey Inc. is an internally managed net lease REIT specializing in corporate sale-leaseback, …

April 22, 2016

New York Northeast Office Top Stories

SL Green, Citigroup Agree on Early Purchase of Office Campus in Manhattan

by John Nelson April 21, 2016

NEW YORK — SL Green Realty Corp. (NYSE: SLG), New York City’s largest commercial property owner, has reached an agreement with an affiliate of Citigroup Inc. (NYSE: C) to accelerate the sale of the global bank’s office campus at 388-390 Greenwich St. in Manhattan’s Tribeca neighborhood. The early sale is pursuant to the $2 billion purchase option that Citigroup exercised in January. Separately, SL Green announced that it has reached an agreement for the early termination of Citigroup’s lease at the property as a result of the sale acceleration. The sale is now scheduled to close in June. SL Green will realize approximately $1.8 billion in sale proceeds at closing, including the lease termination payment. The REIT plans to repay a portion of its corporate credit facility and retire the $1.45 billion mortgage on the office campus. “We are pleased to reach an agreement on the early sale of 388-390 Greenwich Street. In addition, by retiring approximately $1.8 billion of debt, we further strengthen our balance sheet and enhance our liquidity position to in excess of $1.4 billion,” says Marc Holliday, CEO of SL Green. “Our longstanding, multi-faceted relationship with Citi, one of the world’s leading financial institutions, has been …

April 21, 2016

Features Top Stories

Roadmap for Retail Development Survival in the ‘Age of Amazon’

by Katie Sloan April 21, 2016

Recently, I had the opportunity to attend the Entertainment Experience Evolution conference in Los Angeles. This is a relatively new event, focusing on retail and mixed-use destinations with entertainment components as an amenity for retail developments. What was truly interesting is that this conference was not just about adding something fun for guests; it was a profound discussion about the future of retail centers — repositioning existing facilities that are struggling, and finding the “it” factor for new projects. Many industry leaders, including my colleagues from FRCH, presented innovative ideas and perspectives at the event. As retail experts, designers and architects, we spend a great deal of effort taking the pulse of retail in the U.S. and across the globe, evaluating the needs of our guests, macro trends and the overall state of the industry. The general consensus for the future combats old formulas from the past. We know that a development anchored by a grocery or department store simply doesn’t translate positively with consumers in the age of e-commerce. The focus of discussion was on new ways of drawing guests, and on the need for every development to be local, unique and adapted to its immediate environment. While this …

April 21, 2016

Massachusetts Northeast Office Top Stories

TIAA Purchases Historic Boston Seaport Office Portfolio for $224M

by Haisten Willis April 20, 2016

BOSTON — An affiliate of TIAA has purchased a seven-property office portfolio totaling 408,342 square feet in Boston for $224 million, or approximately $550 per square foot. An account advised by New York-based Clarion Partners was the seller of the portfolio, which is located in the Fort Point Channel neighborhood of Boston’s seaport district. Clarion acquired the offices in 2012 for a combined $129.3 million from an affiliate of New York-based Angelo, Gordon & Co. Properties within the 97 percent leased portfolio are located at 263 Summer St.; 332 and 374 Congress St.; and 33-41, 34, 38 and 44 Farnsworth St. The six offices span between five and nine stories and were built between 1890 and 1920, according to the Boston Business Journal. The portfolio also includes a 16-space parking lot. Originally built in the early 1900s, the properties feature high-quality office space with exposed ceilings and natural lighting. Coleman Benedict and director Ben Sayles led the HFF investment sales team, which represented the seller and procured the buyer. According to the Journal, the Farnsworth Street offices will host General Electric Co. (GE) temporarily while the company builds a permanent headquarters on nearby Necco Ct. “TIAA is one of the …

April 20, 2016

Connecticut Northeast Retail Top Stories

Vestis Retail Group Declares Bankruptcy, Will Close All Sport Chalet Stores

by Katie Sloan April 19, 2016

MERIDEN, CONN. — Vestis Retail Group LLC, the parent company of sporting goods and apparel retailers Eastern Mountain Sports (EMS), Bob’s Stores and Sport Chalet, filed for Chapter 11 bankruptcy on Monday. The Meriden-based company plans to close the Sport Chalet chain entirely, while closing eight EMS properties and one Bob’s Stores location. The remaining stores will be re-evaluated in an attempt to strengthen financial performance. Collectively, Vestis Retail Group operates 144 stores and two distribution centers across 15 states, according to documents filed at the U.S. Bankruptcy Court in Wilmington, Del. Hilco Merchant Resources and Gordon Brothers Retail Partners are in charge of the liquidation sales, according to court documents. Private equity firm Versa Capital Management LLC (Versa) acquired each of the chains separately and combined them under the parent company Vestis Retail Group LLC in 2012, according to reports by The Wall Street Journal. Vestis has proposed the sale of EMS and Bob’s to funds advised by Versa, which would acquire substantially all of the remaining assets of the company. “When Vestis first acquired EMS and Sport Chalet, each company faced significant operational challenges and was on the verge of liquidation,” says Mark Walsh, CEO of Vestis. “EMS and …

April 19, 2016

Florida Hospitality Southeast Top Stories

Noble Investment Group Agrees to Buy Five-Hotel Ashford Portfolio for $142M

by Nellie Day April 18, 2016

LAKE BUENA VISTA, FLA. — Noble Investment Group has agreed to buy a five-hotel portfolio in Orlando, Atlanta and New Jersey for $142 million. The portfolio includes a total of 1,396 rooms. The acquisition includes three Marriott-managed properties in the Orlando suburb of Lake Buena Vista: the 312-room Courtyard Lake Buena Vista, the 388-room Fairfield Inn Lake Buena Vista and the 400-room Springhill Suites Lake Buena Vista. The remaining two properties, both operated by Remington Lodging, are the 146-room Courtyard Edison in Edison, N.J., and the 150-room Residence Inn Buckhead in Atlanta. The hotels achieved an average RevPAR (revenue per available room) of $84, with a 79 percent occupancy rate and ADR (average daily rate) of $106 over a 12-month basis. The portfolio has an existing debt balance of about $98 million. The seller, Ashford Hospitality Trust, expects the net proceeds from the disposition to be about $37 million after debt repayment and transaction costs. Ashford will use the proceeds for general corporate purposes, including net debt reduction, stock buybacks or the acquisition of other full-service hotels. The transaction is scheduled to close during the current quarter. “We are pleased to announce this sale as it provides a positive first step …

April 18, 2016

Conference Coverage Features Top Stories

InterFace Student Housing Conference Brings 1,200 Student Housing Executives to Austin

by Katie Sloan April 18, 2016

AUSTIN, TEXAS — The 8th annual InterFace Student Housing Conference concluded Friday after two-and-a-half great days of networking and educational sessions from leaders across all facets of the industry. The conference began Wednesday, April 13, with the SHB Open Golf Outing at Barton Creek Resort & Spa and then moved to the sixth floor of the Hilton Austin, where a record-breaking number of attendees — 1,200 — networked, discussed and dined over a range of industry topics. Speed Networking kicked off the afternoon, where over 100 industry experts participated in short, one-minute conversations designed to spur discussion and foster budding new relationships. The group then moved into over 25 “InterFace+info” roundtables to discuss a range of industry-relevant topics, from “Who’s Buying? Who’s Selling? An Investment Market Update” to “How to Win a Woman’s Lease” and “Wi-Fi & Bulk — The New World of Individual Bandwidth.” A cocktail reception followed the late afternoon roundtables, where attendees were able to continue to build new relationships and explore a variety of booths from exhibitors. A Record Breaking Year After a networking breakfast and workshop, the conference’s panel sessions picked up Thursday morning with a consortium of CEOs from the industry’s top companies in a “Power Panel.” Moderator …

April 18, 2016

Hospitality Southeast Top Stories Virginia

Apple Hospitality REIT Agrees to Acquire Apple REIT Ten for $1.3 Billion

by Christina Cannon April 15, 2016

RICHMOND, VA. — Apple Hospitality REIT Inc. (NYSE: APLE) has agreed to acquire Apple REIT Ten Inc. for $1.3 billion. The merger will create one of the largest select-service hospitality REITs in the industry with a combined 234 hotels and 30,017 rooms. The hotels are located in 94 MSAs across 33 states. The company, which will retain the Apple Hospitality REIT name and ticker symbol, will have an enterprise value of approximately $5.7 billion, according to the companies. Apple Ten, a non-traded REIT, was built and is managed by the same team that currently manages the publicly traded Apple Hospitality REIT. The $1.3 billion transaction value is comprised of $94 million in cash, roughly 49.1 million Apple Hospitality common shares issued to Apple Ten shareholders, and the assumption of approximately $239 million in debt. The merger agreement provides Apple Ten with a 45-day window to solicit alternative proposals from third parties. The termination fee for Apple Ten is $5 million if the company decides to pull out of the agreement within the 45-day window. Following that grace period, Apple Ten will have to pay $25 million to negate the merger with Apple Hospitality. The grace period ends on May 28. …

April 15, 2016

Illinois Midwest Office Top Stories

CIM Group Agrees to Purchase 39-Story Office Tower in Chicago from TIER REIT for $200M

by John Nelson April 14, 2016

CHICAGO — CIM Group, a Los Angeles-based real estate investment firm, has agreed to acquire Four40, a 39-story, 1 million-square-foot office tower located at 440 S. LaSalle St. in Chicago’s financial district. Dallas-based TIER REIT Inc. (NYSE: TIER) is reportedly selling the asset for $200 million, according to Crain’s Chicago. Sources say the deal has not closed, however, and CIM Group declined to comment. Crain’s also reports that between 2013-2014 the REIT sold the other three Chicago assets that it purchased in a four-property portfolio transaction in 2007. According to its 2015 financial results, TIER REIT’s goal for 2016 includes selling $200 million to $400 million of “non-strategic properties.” Built in 1984 and renovated in 2014, the office tower features a 40,000-square-foot amenity floor for tenants, 45,000-square-foot landscaped plaza, café, underground parking, 150-seat conference room, 24-hour staffed security and bay windows that offer 180-degree views. The tower also houses the Chicago Stock Exchange, the Arciel bar and lounge, The Everest Room and The Buckingham Club and Hotel. The Chicago Stock Exchange Inc. (CHX) signed a long-term lease renewal in May 2014 for 33,000 square feet within Four40, a consolidation of its original footprint. In addition to the office tower, new …

April 14, 2016

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