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SKOKIE, ILL. — Skokie-based EPN Group has entered into an agreement to sell 47 shopping centers in the United States to a joint venture between Blackstone Real Estate Partners VII (NYSE: BX) and DDR Corp. (NYSE: DDR) for $1.43 billion. The agreement includes the assumed debt of $640 million and at least $305 million of new financings. Blackstone Real Estate Partners VII will own 95 percent of the common equity of the joint venture and an affiliate of DDR will own the remaining 5 percent. Additionally, DDR will invest $150 million in preferred equity in the venture with a fixed dividend rate of 10 percent, and will continue to provide leasing and management services. DDR will have the right of first offer to acquire 10 of the properties. “We are very pleased to establish a partnership with Blackstone, one of the most successful and respected real estate investors in the world,” said Daniel Hurwitz, president and CEO of DDR, in a prepared statement. “Moreover, this transaction illustrates our access to off-market opportunities while creative structuring enables risk mitigation and non-dilutive deleveraging,” Hurwitz continued. “Lastly, this transaction enables the retention of significant fee income, and enhances our current ownership and future …

NEW YORK CITY — SL Green Realty Corp. (NYSE: SLG) has entered into an agreement to acquire 10 East 53rd Street, a 388,000-square-foot class A office building located in Manhattan, from Cariplo Pension Fund for $252.5 million. The 37-story building is currently 91 percent leased to tenants including Harper Collins. Additionally, SL Green entered into a joint venture agreement with an institutional partner and will hold a 55 percent stake in the venture. The company intends to implement a significant capital improvement program along with a targeted leasing and marketing campaign to reposition and reintroduce the building in the marketplace. “The Plaza District is home to a number of Midtown’s premier trophy assets, and because of the prestige and value of these assets it is rare that an opportunity to acquire one arises,” said Andrew Mathias, president of SL Green, in a prepared statement. “When presented with the chance to add one of these assets to our core Midtown portfolio, we seized it.” “Having recently achieved notable repositioning and leasing successes at 100 Church Street and 3 Columbus Circle, we believe that when we apply our market-leading management capabilities to 10 East 53rd Street, this Midtown office tower will become …

LOS ANGELES — Canyon-Johnson Urban Fund (CJUF) has provided an undisclosed amount of preferred equity capital to launch development of the $160 million One Santa Fe, a 4-acre mixed-use development located in Los Angeles. A joint venture between The McGregor Co., Polis Builders and Goldman Sachs Urban Investment Group (UIG) is developing the project, which is slated to begin construction and site improvements this month. One Santa Fe is located between First and Fourth streets on Santa Fe Avenue in Los Angeles, situated on land owned by the Metropolitan Transportation Authority (MTA). The project is leased under a 78-year ground lease with the MTA, which is considering a potential future direct connection from the property to a new terminal station for the Red Line Subway. Local architect Michael Maltzan designed the development, which will include 438 apartments, 20 percent of which will be affordable housing units, as well as 78,620 square feet of office and retail space and 50,000 square feet of public outdoor space. The MTA expects to sublease 35,000 square feet of One Santa Fe’s commercial space, with the balance of the space leased to community-serving retail tenants. Plans call for the 6-story building to include amenities such …

Borrowers with a low cost of capital are living the dream. The yield on the 10-year U.S. Treasury note fell four basis points to close Friday at 1.96 percent, helping to keep borrowing costs at historic lows for well-qualified commercial real estate investors and underscoring the point that U.S. Treasuries remain a safe haven in an uncertain world. A slowly improving U.S. economy combined with a weak outlook for the financially troubled Euro Zone continues to draw capital to the United States, according to Sam Chandan, president of New York-based Chandan Economics and professor of real estate at the Wharton School of Business. “This was evident on Friday as the dollar improved and the 10-year yield fell following the release of the December jobs report.” The 10-year yield dipped below 2 percent for the first time ever in August 2011 and has been hovering near or below that level since. The Bureau of Labor Statistics reported Friday that nonfarm payroll employment in the U.S. grew by 200,000 in December and that the national unemployment rate fell from a revised 8.7 percent in November to 8.5 percent in December. The private sector added 212,000 jobs, while government cut 12,000 workers. But …

Apartment investors in several major metros across the country, especially Northern California, are hoping 2012 is a carbon copy of 2011. Effective rents for new leases in San Francisco increased a whopping 14.6 percent in 2011 and 12.3 percent in San Jose, according to newly released data from MPF Research. “The Bay Area is in a different stratosphere,” said Greg Willett, vice president of research and analysis at Carrollton, Texas-based MPF. Willett’s update on the vital signs of the multifamily market was the centerpiece of a webinar focusing on apartment development hosted by Dallas-based Humphreys & Partners Architects LP on Wednesday, Jan. 4. Although the annual gains in effective rents for new lesases weren't nearly as dramatic in Boston and Chicago, both markets were strong performers with increases of 8.3 percent and 5.8 percent respectively. One big reason for such a healthy bump in rents was that the occupancy rate nationally rose 1.1 percent from the fourth quarter of 2010 to the fourth quarter of 2011 to reach 94.6 percent, according to MPF. Occupancy was up nearly 3 percentage points from late 2009 when the market bottomed out. Meanwhile, the annual change in effective rents was 4.7 percent in the …

INDIANAPOLIS — Duke Realty has broken ground on the 274,000-square-foot Fifth Third Faculty Office Building, located at the planned 37-acre, $754 million Eskenazi Health campus in downtown Indianapolis. The 5-story building will house support functions for Wishard Health Services, including office space for administrative staff and Indiana University School of Medicine faculty physicians who will practice at the campus. Additionally, it will be used as workspace for research and various academic support programs. Completion of the Fifth Third building is slated for December 2013. St. Louis-based HOK Group and Indianapolis-based BSA LifeStructures are the architects for the project. Duke Realty is the construction and property manager. Along with an 11-story hospital tower and a planned ambulatory care building, the Fifth Third building will enable Eskenazi Health’s physicians and staff to be consolidated on one 1.2 million-square-foot campus. Duke Realty and Health and Hospital Corp. of Marion County (HHC), which operates the Wishard system, will jointly own the Fifth Third building and HHC will lease the property. Indianapolis-based Browning Investments also played a key role during the early stages of the Fifth Third project. Upon full completion, the new campus is expected to receive LEED Silver certification, making it the first …

NEW YORK CITY — LaSalle Hotel Properties (NYSE:LHO) has closed on the $396.2 million acquisition of the 934-room The Park Central Hotel, located on Seventh Avenue between West 55th and West 56th Streets in New York City. The company agreed to purchase the property from Highgate Holdings in June of 2011 for $405.5 million, but received a reduction in accordance with the terms of the purchase and sale agreement. “We are pleased to have finally closed on The Park Central Hotel,” said Michael D. Barnello, president and CEO of LaSalle Hotel Properties, in a statement. “We remain excited about this well-located New York City asset and our ability to acquire the hotel at an attractive purchase price.” The hotel, which was built in 1928, has undergone renovations totaling $33 million since 2004. LaSalle Hotel Properties intends to renovate the guestrooms, guest bathrooms, corridors and the hotel’s lobby, at an estimated cost of $30 million to $35 million. Construction will begin in late 2012 and completion is slated for 2013. Hotel amenities include the 88-seat Cityhouse, Bar Bella, 4,800 square feet of retail space and 14,000 square feet of meeting and function space, including an 8,500-square-foot ballroom. Atlanta-based Hodges Ward Elliott …

Glendale, Calif. — PS Business Parks (PSB) has acquired a 5.3 million-square-foot industrial portfolio of properties located in Northern California for $520 million. The seller was RREEF America REIT II Corp. and its affiliate, Northern California Industrial Portfolio Inc. Included in the portfolio are 18 multi-tenant business parks totaling 2.9 million square feet of light industrial space and 2.4 million square feet of flex space. “This portfolio acquisition significantly enhances PSB’s presence in Northern California, providing a strong concentration of parks in markets that are poised for continued recovery,” said Joseph Russell, Jr., president and CEO of Glendale-based PSB. “PSB has a deep understanding of these markets and we are confident their economic strength and stability will provide opportunities to great value from this unique opportunity.” The properties are located in the Bay Area, with concentrations in Oakland, Hayward, Fremont, Milpitas, San Jose, Santa Clara and Sunnyvale. The portfolio is approximately 82.2 percent leased to 216 tenants. Following the acquisition, PSB now owns 7.2 million square feet of multi-tenant industrial and flex space in 30 business parks in Northern California, or 26.3 percent of the company’s portfolio. In conjunction with the transaction, the company assumed a $250 million secured loan, …

Cleveland’s commercial real estate investment market enjoyed a sustained period of strong activity during the mid-2000s. Fueled by plentiful debt, a seemingly endless supply of buyers and no shortage of willing sellers, the overall sales volume grew to unprecedented levels, topping $1 billion for three consecutive years. While most industry professionals knew this level of activity, as well as the associated upward spiral in pricing, couldn’t last, few had any idea how swift and severe the market would turn. Three hallmark transactions help illustrate the height of the market in 2006-2007 and how far this market has since fallen. The story of each of these sales is profiled below. Duke’s Eastern Suburban Office Portfolio Duke Realty entered the Cleveland marketplace in the mid-1990s by acquiring an existing office portfolio. Over the next decade, the REIT quickly grew to be one of the largest office and industrial owners in the region. However, in 2006, Duke shocked the local market by announcing its intent to sell all of its local holdings and withdraw from the market. Duke sold off most of its holdings in smaller groups of properties and to a variety of buyers. One of the larger of these groups was …

EAST RUTHERFORD, N.J. — CBRE Global Investors has sold the 421,317-square-foot Metropolitan Center, a 15-story office building located at One Meadowlands Plaza in East Rutherford across from MetLife Stadium. An affiliate of KBS purchased the LEED Gold-certified property for $104.9 million. “The sale of Metropolitan Center is consistent with our overall value proposition — to aggressively reposition and operate high-quality real estate, creating exceptional environments for our tenants’ businesses while seeking to provide market-leading performance for our investors,” said Vance Maddocks, president of CBRE Strategic Partners U.S. When CBRE Strategic Partners acquired the property almost 2 years ago, the property was 72 percent leased. Metropolitan Center is now 98 percent leased to tenants including AEGIS Insurance, Hudson News, MWW Group, Cushman & Wakefield and Michael Kors. CBRE has been retained to lease and manage the property. “We are pleased with our success in repositioning Metropolitan Center through our signature 5-Star Worldwide service program and aggressive leasing campaign to increase value for our investor clients,” said Mark Zikakis, managing director of CBRE Investors, in a statement. Jeffrey Dunne, Kevin Welsh and Brian Schulz of CBRE’s New York Institutional Group, along with Don Sperling of CBRE’s Saddle Brook, N.J., office, represented both …