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NAPERVILLE, ILL. — Select Income REIT (NYSE: SIR) has acquired 1415 West Diehl Road, a five-story, Class A office property for approximately $187.5 million, excluding closing costs, in a sale-leaseback transaction. Tellabs Inc., an optical networking firm, entered into a 15-year lease for use of the property as its corporate headquarters. The cap rate, based on current in-place net operating income, including straight-line rents, is approximately 8.7 percent. The property, constructed in 2001 and located in Naperville’s East West Corridor adjacent to Interstate 88, is approximately 820,000 square feet. Its amenities include parking structures, a Starbucks, fitness and convenience centers, and a convenience store. Naperville, located 30 miles west of Chicago, is frequently listed among Money magazine’s “100 Best Places to Live.” It has been awarded the highest bond rating available, the AAA rating, by both Standard & Poor’s and Moody’s for the past 19 years. Select Income REIT, based in Newton, Mass., funded the purchase with cash on hand and borrowings under its unsecured revolving credit facility. “We are excited to have identified and executed this sale-leaseback transaction with a terrific long-term tenant,” says David Blackman, president and COO of Select Income REIT. “1415 West Diehl Road is a …

SAN FRANCISCO — LaSalle Hotel Properties (NYSE: LHO) has purchased the Hotel Vitale in San Francisco for $130 million. The 200-room hotel is located at 8 Mission St. at the intersection of the Embarcadero Waterfront and the Financial District, across from the Ferry Building Marketplace. Newly constructed in 2005, the hotel has undergone $6.5 million in subsequent capital expenditures including restaurant upgrades and new guestroom furniture. Hotel Vitale’s 200 guestrooms average 375 square feet. LaSalle funded the acquisition through its senior unsecured credit facility. “We are thrilled with this acquisition,” says Michael Barnello, president and CEO of LaSalle Hotel Properties. “Hotel Vitale is outstanding physically and in terms of its location. The hotel is surrounded by demand generators that attract corporate and leisure business, and the views from the hotel are breathtaking.” The hotel was purchased subject to a ground lease with the City & County of San Francisco, Municipal Transportation Agency, which expires on March 8, 2070. The hotel is within walking distance of San Francisco’s office towers in the Financial District and South of Market (SoMa) area. There is roughly 21 million square feet of existing office space and 3.5 million square feet of new office development within …

NEW YORK CITY — Constellation Barclay Holding US LLC, an affiliate of Constellation Hotels Holding Ltd., has acquired an 80 percent interest in the historic 685-room InterContinental New York Barclay in Midtown Manhattan for $240 million. InterContinental Hotels Group (IHG) will hold the remaining 20 percent interest. Together, the joint venture will own and renovate the asset, which is valued at $300 million prior to refurbishment. IHG has retained a long-term management contract on the property. Built in 1926 with the support of the Vanderbilt family, this New York luxury hotel provides the ideal base for guests who want to shop on 5th Avenue and is just a short walk from the Museum of Modern Art, according to the hotel’s website. The JLL Hotels & Hospitality Group, which arranged the transaction on behalf of IHG, was led by Mark Wynne-Smith, global CEO; Arthur Adler, managing director and CEO of the Americas; managing director Jeffrey Davis; and executive vice president Gilda Perez-Alvarado. The InterContinental New York Barclay, located at 111 East 48th St., attracted strong interest from domestic, Middle Eastern and Asian investor groups by virtue of its long-standing reputation in New York, its affiliation with InterContinental Hotels, and its location …

SAN FRANCISCO AND PALO ALTO, CALIF. — Essex Property Trust Inc. (NYSE: ESS) and BRE Properties Inc. (NYSE: BRE) have completed the merger of the two multifamily REITs, forming a new entity with a total market capitalization of approximately $16.2 billion. Going forward, the combined company will trade under the ticker symbol ESS on the New York Stock Exchange. The REIT’s equity market capitalization totals approximately $11.1 billion. “We are excited to consummate the merger and move forward to combine these two great organizations to form the leading West Coast multifamily REIT,” says Michael Schall, president and CEO of Essex. “The integration effort is proceeding as planned, which we believe will result in a stronger platform for sustainable growth, superior service for our residents and expanded career opportunities for our employees.” With the merger complete, former Essex stockholders hold approximately 63 percent of the combined company’s stock, while former BRE stockholders hold approximately 37 percent. Each share of BRE common stock was converted into 0.2971 shares of the new common stock, plus $7.18 in cash per share. “We are pleased that our stockholders have expressed overwhelming support and approval for this merger,” says Constance Moore, CEO of BRE. “The combined …

AUSTIN, TEXAS — Carey Watermark Investors Inc. has acquired Hyatt Place Austin Downtown, a 296-room upscale select-service hotel, for $87 million. The acquisition was financed with $56.5 million of debt and includes $3.9 million of acquisition-related costs and minor capital improvements. Hyatt Place Austin Downtown is located in the heart of Austin. Completed in 2013, the hotel is one block from the Austin Convention Center at 211 E. 3rd St., two blocks from the Sixth Street entertainment district, one-half mile from the State Capitol building and one mile from the University of Texas campus. Major companies in the area include Dell, Apple, AMD, Whole Foods and Silicon Labs. The hotel is close to more than 50 restaurants and the Austin-Bergstrom International Airport. Amenities at the 17-story hotel include free Wi-Fi, 1,800 square feet of high-tech meeting and function space, an indoor pool, a StayFit at Hyatt fitness center and free public computers with remote printing. The hotel also features a coffee-to-cocktails bar and offers a complimentary kitchen skillet breakfast. “The acquisition of the Hyatt Place Austin Downtown represented an opportunity to invest in a newly built, high-quality, select-service property in one of the strongest domestic hotel markets,” says Michael Medzigian, …

TRUMBULL, CONN. — NorthMarq Capital’s New York office has arranged $115 million in construction financing and a permanent mortgage for an expansion of the Park Avenue campus of Bridgeport Hospital in Trumbull, located 65 miles northeast of New York City. The 120,000-square-foot Class A facility will consist of a parking garage, as well as a three-story outpatient facility that includes three surgical suites, two lead-lined radiation treatment rooms, chemotherapy lounges, a phlebotomy lab, a radiology practice and a healing garden. Ernest DesRoshers and Deanna Polizzo of the New York office of NorthMarq arranged the transaction, a 25-year fully amortizing, private-placement bond deal with a set rate that may be lowered at a future time. The transaction provides for phased funding to minimize negative arbitrage as well as a free loan to the interest holder. NorthMarq arranged the financing with a credit tenant lease lender. “We were able to restructure the existing debt on the two pre-existing properties that will be connected by the to-be-built medical office building,” says Polizzo. Other amenities of the development include multiple entrances for patients for close proximity to doctors, skybridges and awnings to provide protection from the elements, and well-lit parking and entry areas.

NEW YORK — Greystone has provided financing for five multifamily properties in the Austin and Dallas-Fort Worth Metroplex areas in Texas totaling $59.3 million. The New York-based lender provided the acquisition financing through its Fannie Mae DUS platform. Robert Russell of Greystone originated the loans with 10-year terms and 80 percent loan-to-value (LTV) in two pools. The properties acquired, which total approximately 1,442 units, include: • Cypress Club in Arlington • Windsprint Apartments in Arlington • Hunters Cove in Grand Prairie • Arbors of Austin in Austin • Northgate Hills in Austin In the first two months of 2014, Fannie Mae recorded roughly $2.4 billion in multifamily lending volume. In all of 2013, the agency closed approximately $28.8 billion in loans. Greystone has been a Fannie Mae DUS lender for more than 15 years. Multifamily investors and developers are targeting apartment markets in major metros across Texas due to the state’s growing job market and population base. In the Fannie Mae Economic and Strategic Research’s report from November 2013, entitled “The Lone Star State Shines Bright,” Fannie Mae economists Francisco Nicco-Annan and Kim Betancourt write that the average annual job growth in the majority of the Texas metros is expected …

BAKERSFIELD, CALIF. — American Tire Distributors has signed a 20-year lease for more than 1 million square feet of space at the master-planned Paramount Logistics Park in Shafter, a city about 20 miles northwest of Bakersfield. The lease is valued at $119 million. The 1,625-acre logistics park, owned and managed by Roll Real Estate Development, is located at 5000 Capital Road. The new $65 million, built-to-suit facility will be situated on more than 45 acres and will include 10,000 square feet of office space. It will break ground this spring. American Tire has occupied a 176,500-square-foot industrial building at Paramount Logistics Park since 2007. The company had entered into a build-to-suit lease agreement with Roll Real Estate Development this past May for a 350,000-square-foot building within the park. American Tire recently restructured that lease, however, and tripled its requested space due to a consumer demand increase in the Western U.S. “American Tire's expansion in the Central Valley will significantly improve its capability to distribute to tire retailers quickly and more efficiently,” says Jason Gremillion, Roll Real Estate Development’s vice president of development. “Being located at the Paramount Logistics Park provides strategic access to customers throughout the western states, and they …

JERSEY CITY, N.J. — HAP Investments LLC has agreed to purchase 500 Summit Avenue, a development site at Journal Square in Jersey City’s central business district. The New York-based real estate investment and development company is planning to build a $400 million mixed-use building, to be known as HAP Tower, on the land. The project will include office, retail and multifamily space totaling approximately 1 million square feet. The land, nearly one acre, can accommodate a structure of up to 42 stories. The surrounding area, known as Journal Square as the home of the former Jersey Journal headquarters, is undergoing a city-sponsored redevelopment. HAP Investments paid $28 million for its site, according to The Wall Street Journal. “We are excited to have purchased this strategic site in Jersey City,” says Eran Polack, CEO of HAP Investments. “We look forward to building a future development that will provide new rental housing for local residents as well as others in the metropolitan area, in addition to adding needed office and community facilities to this thriving urban location.” “HAP Investments is also committed to sound environmental development, and to creating an open urban green space environment for this project,” Polack adds that the …