Top Stories

Associated Bank Purchases Milwaukee Center for $60.5M

by Haisten Willis April 6, 2016

MILWAUKEE — Associated Bank (NYSE: ASB) has purchased the Milwaukee Center office building at 111 E. Kilbourn Ave. in downtown Milwaukee. The purchase price was not disclosed, but the Milwaukee Business Journal reported it was $60.5 million. Chicago-based Hub Milwaukee River Center Properties sold the 28-story downtown building to Milwaukee Center Management LLC, a Green Bay, Wis.-based affiliate of Associated. Reinhart Boerner Van Deuren represented Associated Bank in the transaction. Associated will occupy between one-fourth and one-third of the building when the lease on its current regional office expires in 2022. Around 320 Associated employees currently occupy 97,000 square feet of the Plaza East towers at 330 East Kilbourn Ave. “Our purchase of this iconic, city-center building aligns with our efforts to become the city’s hometown bank,” says Philip Flynn, president and CEO of Associated Bank, which is based in Green Bay. The Class A property was built in 1988 and is 426 feet tall, with a total size of 373,000 square feet. It was 81.7 percent leased at the time of sale. Milwaukee Center is attached to a 220-room InterContinental hotel, Milwaukee Rep Theaters and Pabst Theater. Amenities include three on-site dining options and an on-site fitness studio. Associated Bank’s stock …

April 6, 2016

Hospitality Loans Office Retail Top Stories Western

Developers Receive $225M Loan to Finance The Bloc Mixed-Use Project in Downtown Los Angeles

by Nellie Day April 5, 2016

LOS ANGELES — The developers of The Bloc, a 1.1 million-square-foot office, retail and hospitality redevelopment in downtown Los Angeles, have received a $225 million permanent loan to finance the project. The Bloc is located at 700 S. Flower Street. The site was originally built in 1973 as a traditional mall. The redevelopment will transform the space into an open-air urban complex. It will be the largest mixed-use property in Los Angeles, according to developers The Ratkovich Company, National Real Estate Advisors and Blue Vista Capital. The Bloc is scheduled to open this summer. A renovated flagship Macy’s will anchor the center. The Bloc will also offer a variety of artisanal retailers and restaurants, as well as creative-leaning office space and a newly renovated, 496-room Sheraton Los Angeles Downtown. The new loan replaces an existing CMBS loan inherited when the property was purchased in 2013, with a final payoff amount of about $121.6 million. It also provides additional proceeds to finalize the redevelopment and fund leasing costs at the property. “This financial commitment lends further credence to the vibrant revitalization underway in downtown and lays the foundation for continued growth in the decades ahead,” says Jeff Kanne, president of National …

April 5, 2016

CBRE 2016 Global Real Estate Survey Results

Features Top Stories

U.S. Remains Prime Target for Global Real Estate Investors, CBRE Survey Finds

by Jeff Shaw April 5, 2016

Global real estate investors plan to make $1.16 trillion in gross acquisitions in 2016, according to a newly released survey from CBRE. That’s up 3 percent from last year’s survey conducted by the giant Los Angeles-based real estate services provider. The United States is still the primary target for investors, who collectively plan to spend 48 percent of their dollars in this country. The next most popular target for investors is Western Europe. More specifically, investors plan to spend 28 percent of their capital in Western Europe. Additionally, CBRE reports investor interest in Central and Eastern Europe grew compared with last year’s survey as a result of the faster pace of economic recovery in that region. “The majority of investors (82 percent) indicate that their buying activity will increase or remain the same compared to 2015,” according to the CBRE Global Investor Intentions Survey analysis. “While these results are down slightly from the last two years — 86 percent in 2015 and 93 percent in 2014 — this is not indicative of widespread concern about the short- or medium-term performance of real estate as an asset class. More likely, it reflects some concerns about pricing, the direction of U.S. interest …

April 5, 2016

Maryland Office Southeast Top Stories

Vision Properties Acquires Trophy Office Tower in Baltimore for $187M

by Katie Sloan April 4, 2016

BALTIMORE — Vision Properties has acquired 100 East Pratt, a 662,708-square-foot trophy office tower at 100 E. Pratt St. overlooking Baltimore’s Inner Harbor, for $187 million. Vision acquired the asset from Columbia Property Trust (NYSE: CXP). The building is the long-time headquarters of T. Rowe Price, a global investment firm that leases roughly 65 percent of the building. Other tenants of the tower, which was 98.5 percent leased at the time of sale, include PriceWaterHouseCoopers, Merrill Lynch and Tydings & Rosenberg. The property is located in downtown Baltimore near Harborplace and The Gallery, as well as a multitude of dining and retail options around the Inner Harbor and along Pratt Street. Stephen Conley, Jim Meisel, Dek Potts, Andrew Weir and Matt Nicholson of HFF represented Columbia Property Trust in the transaction, which also included the property’s 932-space parking garage. Vision Properties plans to upgrade the lobby of the 28-story building, according to reports by the Baltimore Business Journal. Columbia Property Trust intends to use the proceeds of the sale to repay a $119 million short-term bridge loan and borrowings on its unsecured credit facility. Vision Properties is a full-service real estate investment and management firm headquartered in New Jersey. The …

April 4, 2016

Connecticut Hospitality Northeast Top Stories

Anbang Ends Bidding War by Pulling Out of $14B Proposal to Acquire Starwood Hotels & Resorts

by Christina Cannon April 1, 2016

STAMFORD, CONN. — Anbang Insurance Group and Marriott International Inc. (NASDAQ: MAR) entered a ceasefire yesterday. The bidding war between the two companies to purchase Starwood Hotels & Resorts Worldwide (NYSE: HOT) has ended, as Anbang has rescinded its latest offer. A consortium consisting of Anbang, J.C. Flowers & Co. and Primavera Capital Limited upped its offer to $14 billion on March 26, outbidding Marriott’s previous offer of $13.6 billion, but Anbang is now withdrawing its offer due to “market considerations.” It isn’t clear why Anbang retracted its latest bid or if Marriott had been planning to counteroffer. Both Starwood’s and Marriott’s shares fell over 4 percent in Thursday’s after-hours trading. Starwood’s stock price closed on March 31 at $83.43 per share and opened April 1 at $79.81. Marriott’s stock price closed at $71.18 and opened at $67.48 per share. Starwood’s board of directors continues to unanimously support the existing merger with Marriott, which will create the largest hospitality company in the world. “Throughout this process, we have been focused on maximizing stockholder value now and in the future,” says Bruce Duncan, chairman of Starwood’s board. “We continue to be very excited about the combination of our two companies and …

April 1, 2016

California Mixed-Use Top Stories Western

Construction Begins on $6B Redevelopment Project in San Francisco Bay Area

by John Nelson March 31, 2016

SAN FRANCISCO — Construction crews have begun infrastructure work on the redevelopment of Treasure Island and Yerba Buena Island in the San Francisco Bay Area. The total development costs for the 10-year project will be $6 billion, according to the San Francisco Business Times. The development team, known as Treasure Island Community Development LLC, includes Lennar Urban (NYSE: LEN), Kenwood Investments, Stockbridge Capital Group and Wilson Meany. The San Francisco Planning Commission approved the project in 2011, and Skidmore, Owings and Merrill LLP developed the master architectural and engineering plan. The development will feature up to 8,000 residential units, including 7,700 to 7,850 on Treasure Island and 150-300 units on Yerba Buena Island. At least 25 percent of the multifamily units will be offered at below-market rates. The project will also include up to 140,000 square feet of new retail space, 300 acres of parks and public open spaces, up to roughly 500 hotel rooms, a joint police/fire station and 100,000 square feet of office space. The development team will also repurpose Building 1 and Hangars 2 and 3 on Treasure Island and the historic buildings on Yerba Buena Island. According to Kenwood Investments’ website, the development could feature a …

March 31, 2016

Features Top Stories

Building-Data Tools Continue to Fuel Energy Efficiency

by Katie Sloan March 31, 2016

Major corporations focus on more than the traditional bottom line. Today’s companies are measured by their “triple bottom line” — which measures social and ecological performance along with financial performance. As energy efficiency is an important factor in both reducing a company’s operating costs and its environmental footprint, the market is seeing a steady increase in utilization of building-data tools that help owners and managers. Why are these tools necessary? In an environment where building owners and managers are inundated with data through various sources and in various forms, understanding what the data actually means can be a daunting task. If incorrectly interpreted, data can potentially lead to fruitless building renovations. To help the market accelerate energy-efficiency initiatives, the U.S. Department of Energy (DOE) has worked on a series of analysis tools that help address various market barriers. These tools can be used to collect, manage and analyze information about building performance, as well as guide the implementation of energy-efficiency programs and policies and lead users to a better understanding of energy-efficiency applications. An integral part of this system is the Building Energy Asset Score tool, which assesses the physical and structural efficiency of a building to assist building owners …

March 31, 2016

one-wells-fargo-center-301-south-college-charlotte

North Carolina Office Southeast Top Stories

Starwood Capital, Vision Properties Sell One Wells Fargo Center in Charlotte for $284M

by Haisten Willis March 30, 2016

CHARLOTTE, N.C. — In one of the largest office building transactions ever in North Carolina, Starwood Capital and Vision Properties have sold One Wells Fargo Center in Charlotte’s central business district for $284 million. According to the Charlotte Observer, the buyer was a limited liability company tied to Dennis Troesh, a Nevada businessman who founded a concrete company in the 1970s that was later acquired by Tokyo-based Mitsubishi Materials Corp. Starwood and Vision purchased the building in 2013 for $245 million. One Wells Fargo Center opened in 1988 and is located at 301 S. College St. The 42-story tower, which spans more than 1 million square feet, is home to a mix of financial, legal and real estate firms. One Wells Fargo Center serves as the East Coast headquarters for Wells Fargo, the largest bank in the world in terms of market capitalization. The building was 98 percent occupied at the time of sale. The building features amenities such as covered parking, two restaurants, the Childress Klein YMCA, a coffee shop and a dry cleaner. It also serves as one of only two downtown buildings with direct access to the LYNX public transportation system. One Wells Fargo Center is on …

March 30, 2016

Florida Hospitality Southeast Top Stories

Dilido Beach Resort Receives $210M Refinancing for The Ritz-Carlton South Beach

by Katie Sloan March 29, 2016

MIAMI — Dilido Beach Resort LLC, a joint venture between Lionstone Development and Flag Luxury, has received a $210 million loan for the refinancing of The Ritz-Carlton South Beach. Greenberg Traurig and Eastdil Secured arranged the loan, which will be used for planned capital improvements to the hotel, through lenders Cantor Commercial Real Estate (CCRE) and Societe Generale. The 375-room luxury hotel was originally built in 1953, and has been restored to reflect the original Morris Lapidus design. Located within walking distance of Ocean Drive and Lincoln Road in Miami, the hotel features an oceanfront infinity pool with private day beds, the DiLido Beach Club, two restaurants, a $2 million art collection featuring established and emerging artists, a 16,000-square-foot spa and 20,000 square feet of conference space. The resort underwent a $10 million renovation in 2012, according to reports by the South Florida Business Journal. The restoration, led by Miami-based interior designer Linda Zarifi, included the redesign of its 375 guest rooms. “We are very pleased to secure this financing for our flagship hotel,” says Paul Kanavos, CEO and chairman of Flag Luxury. “South Beach is a vibrant and diverse hospitality market and we are proud to be the leaders …

March 29, 2016

Features Multifamily Student Housing Top Stories

2015 Was Record-Setting Year for Student Housing, Says FourPoint

by Katie Sloan March 29, 2016

AUSTIN, TEXAS — With approximately $4.8 billion in total sales volume and 133 individual transactions, 2015 has become the highest sales volume year in the history of the student housing sector, according to a year-end report by Austin-based brokerage FourPoint Student Housing Investments. The sales volume seen in 2015 surpassed the previous sales volume record — set in 2014 — by over $1 billion. Last year also saw a spike in pricing compared to 2014, with price per unit, per bed and per-square-foot all seeing a surge throughout the year. Much of this increase can be attributed to location. A large percentage of the product being delivered is located in core, urban areas with high rents and high development costs in order to maintain walkability to universities. The convergence of low U.S. Treasury rates and increased desire for student housing resulted in some of the most expensive trades and lowest capitalization rates ever recorded, according to the report. CMBS lenders continue to play a significant role in the overall capital markets space as well, as many of the CMBS-financed assets reach loan maturity. Congruently, many owners will put value-add properties up for sale, seeking to divest in a seller’s market. …

March 29, 2016

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