Top Stories

Morgan Properties Buys Four-State, 11-Property Multifamily Portfolio for $316M

by Nellie Day September 12, 2016

KING OF PRUSSIA, PA. — Morgan Properties has purchased an 11-property multifamily portfolio that spans four states for $316 million. The assets, collectively known as Star Portfolio, contain a total of 2,826 units across Maryland, Pennsylvania, North Carolina and South Carolina. The transaction includes the Greens at Westgate in Pennsylvania; the Waterway and Forest Oaks in South Carolina; Falls Creek and Heather Park in North Carolina; and Silver Spring Station, Westerlee, the Willows, St. Mary’s, Taylor Park and Willowood in Maryland. The assets have an average age of 29 years. All the properties are situated in high-barrier submarkets close to major development hubs and public transit. Morgan Properties plans to execute a multi-million-dollar, value-add repositioning plan at each property. The renovation strategy will include premium kitchen and bath renovations and amenity upgrades. Morgan Properties acquired Star Portfolio through an affiliated joint venture. David Oakley and Scott Melnick of Berkadia represented Morgan Properties in the transaction. Deutsche Bank represented the unnamed seller. The firm also recently purchased three separate Maryland multifamily assets, including the 325-unit Grand Pointe in Columbia; the 606-unit Avery Park in Silver Spring; and the 450-unit Henson Creek in Temple Hills. Morgan Properties owns and manages 132 apartment …

September 12, 2016

Georgia Industrial Southeast Top Stories

Sentury Tire to Build $530M Manufacturing Plant in Georgia

by Jeff Shaw September 9, 2016

LAGRANGE, GA. — Sentury Tire, a China-based tire manufacturer, has announced plans to build a $530 million tire factory in LaGrange, approximately 65 miles southwest of Atlanta. Sentury expects the plant to create more than 1,000 jobs in production, sales, marketing, warehousing and distribution, and support the company’s U.S. operations. The company expects to start production in 2018, with a projected output of 12 million passenger and light truck tires per year. Sentury was drawn to Georgia by a tax incentive package, but details were not disclosed, according to the Atlanta Journal-Constitution. Sentury Tire products are sold under the Sentury, Landsail and Delinte brands. The company focuses on light truck and airplane tires. Approximately 70 percent of the company’s sales are in the European and U.S. markets. Sentury Tire’s parent company, Qingdao Sentury Tire Co., is based in Qingdao, China. “The state of Georgia has had a strategic office in China since 2007 and an office in Qingdao since 2013, helping foster business connections between Georgians and Chinese professionals,” says Chris Carr, commissioner of the Georgia Department of Economic Development. “This project is a great example of the relationships that have been forged through active communication and engagement in China.” …

September 9, 2016

New York Northeast Retail Top Stories

Two Non-Traded Retail REITs Merge in $1.4B Transaction

by John Nelson September 8, 2016

NEW YORK CITY — American Finance Trust Inc. (AFIN) has acquired all of the outstanding common stock of American Realty Capital – Retail Centers of America Inc. (RCA) for approximately $1.4 billion, including the assumption or repayment of $432 million in debt. The merger of the two New York-based, non-traded REITs creates a retail REIT with an enterprise value of approximately $3.9 billion. The combined company will retain the AFIN name and continue to be led by AFIN’s management team, with the addition of Kase Abusharkh from RCA, who will serve as AFIN’s chief investment officer of the multi-tenant portfolio. Members of both boards of directors will continue to serve on the board of the combined company. “The combination of AFIN and RCA will help the company achieve critical scale, afford improved access to capital markets, result in significant cost savings for shareholders and increase coverage of our distributions,” said Michael Weil, CEO of AFIN. “For AFIN, today’s announcement is a key step forward in our plan to grow earnings.” AFIN, formerly known as American Realty Capital Trust V Inc., was formed in January 2013 to acquire mostly freestanding, single-tenant retail properties leased to investment grade or other creditworthy tenants. …

September 8, 2016

Tomball Four Corners Shopping Center in Tomball, Texas

Features Retail Top Stories

Finding the Right Tactics is Key for Repositioning Retail

by Jeff Shaw September 8, 2016

For real estate developers and investors, a time of transition and evolution within the retail world presents abundant opportunities to capitalize by acquiring and investing in underperforming spaces. With an infusion of capital, some strategic restructuring and re-tenanting with regional and national brands, a moribund center or underwhelming site can be transformed. Understanding the strategies deployed to effectively identify, acquire, reposition and re-tenant retail is an essential prerequisite for any commercial real estate professional looking to get involved in the process. The big picture The most critical step in the process is selecting the right opportunities to pursue in the first place. Identifying existing retail assets that are underperforming is one thing. Finding those that can be successfully reinvigorated and repositioned through an infusion of capital and the application of some expertise is a little trickier. It is a best practice to confine your search to well-established trade areas because you generally do not want a project on the fringe. The overall goal is to identify markets and trade areas where there is more demand than quality supply, and then work to find a creative and cost-effective way to deliver that supply. Once you identify those areas, familiarize yourself with …

September 8, 2016

Multifamily New York Northeast Top Stories

AvalonBay Sells 504-Unit Multifamily Community in New York City Suburb for $147M

by Haisten Willis September 7, 2016

NANUET, N.Y. — AvalonBay Communities Inc. (NYSE: AVB) has sold eaves Nanuet, a 504-unit multifamily community in the New York City suburb of Nanuet, for $147 million. A joint venture between Harbor Group International LLC and Azure Partners LLC purchased the asset free and clear of existing debt. The community is situated on 54 acres at 100 Avalon Gardens Drive. HFF represented AvalonBay in the transaction. The property is located near Interstate 287’s intersection with the Garden State Parkway and Palisades Interstate Parkway. Nanuet’s Metro North train station and park and ride lot are also located nearby. The 97 percent-leased community includes 64 buildings with a mix of one-, two- and three-bedroom apartments averaging 1,208 square feet. Apartments feature loft spaces, gas fireplaces, closet and attic storage, in-unit washers and dryers, direct-access personal garages, and patios/balconies. Community amenities include an outdoor swimming pool with sun deck, two tennis courts, grilling areas, two playgrounds, clubhouse, fitness center, yoga room, indoor basketball and racquetball courts, and a resident lounge with a fireplace and business center. Jose Cruz, Kevin O’Hearn, Michael Oliver, Stephen Simonelli and Robert Borny led the HFF investment sales team representing the seller. “Demand for well-located, value-add multifamily housing continues to …

September 7, 2016

New York Northeast Retail Top Stories

Kimco Realty Acquires Remaining Interest in Four-Property Retail Portfolio for $170.7M

by Katie Sloan September 6, 2016

NEW HYDE PARK, N.Y. — Kimco Realty Corp. (NYSE: KIM) has bought out its joint venture partners in a four-property retail portfolio, purchasing the remaining 85 percent interest for $170.7 million. The acquisition included the assumption of $103 million in mortgage debt, $26 million of which was prepaid by the company. The joint venture partners that sold their interest were undisclosed. The portfolio includes Perimeter Expo, a 175,835-square-foot shopping center in the Atlanta suburb of Dunwoody, Ga.; Cranberry Commons, a 166,495-square-foot shopping center in the Pittsburgh suburb of Cranberry Township, Pa.; Cypress Towne Center, a 279,210-square-foot shopping center in Houston; and Doc Stone Commons, a 101,042-square-foot shopping center in Stafford, Va., approximately 50 miles southwest of Washington, D.C. Portfolio tenants include Nordstrom Rack, Marshalls, Old Navy and Newk’s Eatery at Perimeter Expo; TJ Maxx, Lane Bryant, PetSmart and Starbucks Coffee at Cranberry Commons; Michaels, Best Buy, TJ Maxx and Bed Bath & Beyond at Cypress Towne Center; and Petco, Giant Food, Staples and Subway at Doc Stone Commons. In a separate transaction, Kimco recently acquired Kentlands Market Square, a 251,000-square-foot, open-air shopping center located in the Washington, D.C., suburb of Gaithersburg, Md., for $95 million. Whole Foods Market anchors the …

September 6, 2016

Fountain Square Commerce Center, Chicago

Features Heartland Feature Archive Industrial Top Stories

Midwest Industrial Business Parks Evolve in Pursuit of E-Commerce

by Jeff Shaw September 6, 2016

There’s a reason why warehouse facilities and fulfillment centers ranked No. 1 and 2 for 2016 investment and development prospects. In addition to the annual commercial real estate survey findings by PwC and the Urban Land Institute, the National Council of Real Estate Investment Fiduciaries (NCREIF) is reporting that the Midwest posted the strongest industrial income return among all U.S. regions in second quarter 2016. “E-commerce is affecting more than just the industrial real estate business park. It is the most significant driver of demand in industrial products across the county right now,” says Ryan O’Leary, regional senior vice president at Duke Realty. “Business parks are obviously a big beneficiary of that.” O’Leary, who oversees the Chicago, Minneapolis and St. Louis markets for the Indianapolis-based REIT, estimates that e-commerce drove 35 to 40 percent of the approximately 8 million square feet of industrial absorption in the Windy City during the second quarter. Business parks with very good infrastructure, access to major thoroughfares and easy flow for heavy truck and auto traffic have a huge advantage in securing that tenant demand, which usually requires a quick turnaround on building delivery. Unlike development costs for a garden-variety warehouse space 15 years ago, …

September 6, 2016

Midwest Missouri Retail Top Stories

BIG Shopping Centers, RED Development Acquire 516,268 SF Shopping Center Near Kansas City

by Christina Cannon September 2, 2016

LEE’S SUMMIT, MO. — A joint venture between BIG Shopping Centers USA and RED Development has acquired Summit Fair, a 516,268-square-foot shopping center, for an undisclosed price. Located 25 miles southeast of Kansas City in Lee’s Summit, Summit Fair is anchored by Macy’s and JCPenney. Other tenants in the open-air lifestyle center include Victoria’s Secret, Chico’s, Francesca’s and LOFT. Summit Fair boasts approximately 50 tenants. Along with the news of the acquisition, the joint venture also announced a 50,000-square-foot DICK’S Sporting Goods and a 20,000-square-foot H&M will open at Summit Fair in spring 2017. DICK’S Sporting Goods will relocate to Summit Fair from its existing store currently open at RED’s sister property, SummitWoods Crossing. An additional 5,000 square feet of space is available in the H&M building. “Summit Fair is already a dynamic, high-performing retail property serving a vibrant market, and the addition of DICK’S Sporting Goods, H&M and other top-drawing retail concepts sets the stage for continued success,” says Mike Ebert, managing partner at RED Development. The joint venture, known as BIG RED Portfolio LLC, has a portfolio consisting of 10 retail assets totaling over 3.5 million square feet in four states. Within the joint venture, BIG USA, acts primarily as a co-investment …

September 2, 2016

California Office Top Stories Western

Kilroy Sells Minority Stake in Two Office Towers in San Francisco for $452.9M

by John Nelson September 1, 2016

SAN FRANCISCO — Kilroy Realty LP, the operating arm of Kilroy Realty Corp. (NYSE: KRC), has agreed to sell minority interests in two Class A office towers in San Francisco to Norges Bank Real Estate Management for $452.9 million. Norges Bank is the real estate investment arm of the government pension fund of Norway. Under the terms of the agreement, Norges Bank will invest in a 44 percent common equity interest in two existing companies that own the towers, which are located at 100 First St. and 303 Second St. in San Francisco’s SOMA district. The sales price is based on an appraisal value of $1.16 billion for both assets and includes Norges Bank’s proportionate assumption of the existing mortgage debt, or $55.3 million. Kilroy will remain the majority owner of the two office towers and will continue to provide property management, leasing and construction management services for the properties. The two office towers span approximately 1.2 million square feet combined. The assets were 96.4 percent leased as of July 31. The transaction was structured with a staggered closing, whereby the 100 First St. venture closed on Aug. 30 with a contribution by Norges Bank of $191.4 million. The 303 …

September 1, 2016

Illinois Midwest Mixed-Use Office Top Stories

CIM Group to Buy Tribune Tower in Chicago for $205M

by Haisten Willis August 31, 2016

CHICAGO — Tribune Media Co. (NYSE: TRCO) has agreed to sell the iconic Tribune Tower in downtown Chicago to Los Angeles-based CIM group for $205 million in cash at closing. The buyer could pay up to an additional $35 million based on contingencies and conditions, which could bring the total up to $240 million. The sale is expected to close by the end of September. Built in 1925, the building features 35 stories and nearly 740,000 square feet. The sale also includes a 36,000-square-foot development site located directly to the east of Tribune Tower, fronting Cityfront Plaza. “Tribune Tower has been a unique part of Chicago’s skyline since the 1920s,” says Peter Liguori, Tribune Media’s president and CEO. “It is a gem of architectural and structural accomplishment and a constant reminder of the important role that Tribune has played in the development of the city itself.” Since the beginning of the year, Tribune Media has sold several smaller properties in markets ranging from South Florida to Seattle for gross proceeds of approximately $89 million. Earlier this year, the company agreed to sell the north block of the Los Angeles Times Square property and the nearby Olympic printing plant, both in Los …

August 31, 2016

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