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NEW YORK CITY — Africa Israel USA (AFI USA) has closed on the $165 million sale of the 267,000-square-foot Clock Tower Building, a former office building located at 5 Madison Ave. in New York City. Marriott International Inc. purchased the building, and will convert the 41-story property into New York’s first Marriott EDITION brand hotel. “We are delighted to have reached an agreement with Marriott International to secure the future of this remarkable building and support the burgeoning vitality of the Madison Square Park neighborhood,” said Tamir Kazaz, CEO of AFI USA, in a prepared statement. “The EDITION hotel brand will be a perfect fit for this great neighborhood.” The EDITION hotel brand is a new luxury, lifestyle brand created in a partnership between Marriott International and Ian Schrager. AFI USA purchased the building for $200 million in 2007. Metropolitan Life Insurance originally built and occupied the building, but it has been empty since 2005. The Clock Tower Building is one of Manhattan’s earliest skyscrapers. “We are delighted to have achieved such a strong price for this asset as a hotel property,” said Laurie Golub, general counsel and managing director of business affairs of AFI USA. “It speaks to the …

Columbia, S.C. — Columbia's CBD office sector is on the verge of becoming a landlord’s market. So says David Lockwood, senior vice president of leasing for Colliers International South Carolina Inc., who expects that in 2012 owners of downtown office buildings will offer fewer concessions than the previous 12 months as vacancies fall and rents rise. “Tenants just aren’t going to be able to find the deals that were out there a year or 2 years ago,” said Lockwood during a 30-minute webinar hosted by Colliers on Monday that focused on office leasing and employment trends in greater Columbia. In contrast, however, Lockwood fully anticipates rental rates in Columbia’s suburban office market will fall as landlords pull out all the stops to land tenants. “Suburban landlords will become even more aggressive,” said Lockwood. “They’ll offer more concessions, and they’ll offer more TI (tenant improvements), and that has a short-term degrading effect on the market by lowering the average rental rates.” The direct vacancy rate for the office market as a whole stood at 24 percent at the end of 2011, including 22.67 percent in the CBD and 25.49 percent in the suburbs, according to Colliers. In the CBD, much of …

The Richmond, Virginia, office market is gradually recovering from the effects of the recession and an unusual flurry of large-block office vacancy following several major corporate bankruptcies and relocations during 2008 and 2009. In 2011, overall vacancy declined slightly from 10.9 percent to 10.6 percent, year-over-year. Average asking rents increased slightly; however, tenants remain aggressive in seeking favorable terms. Due to a continued abundance of available Class A office space, office development remains at a standstill, with the exception of pre-leased medical office buildings. The metro Richmond office market saw a significant increase in leasing activity in 2011 with 2.5 million square feet leased compared to 1.83 million in 2010. Overall positive space absorption of 495,631 square feet was just under the 2010 total of 543,287 square feet, reverting back to close to normal absorption following the negative 1.3 million square feet of absorption reported in 2009. The market leader during 2011 was suburban Innsbrook, or the northwest quadrant submarket, with more than 1 million square feet of leasing activity. The largest submarket in the region, it suffered major losses in occupancy when the bankruptcies of Circuit City stores and LandAmerica, as well as the relocations of Wells Fargo Securities …

BETHESDA, MD. — In 2011, Beech Street Capital provided $2.2 billion in multifamily financing, more than double the amount secured in 2010, its first year. “This was really a breakthrough year for us,” said Grace Huebscher, president and CEO of Beech Street, in a prepared statement. “The word is clearly getting out among borrowers that Beech Street is committed to providing an extraordinary level of service and execution.” Beech Street doubled its Fannie Mae business and more than tripled its Freddie Mac business, while its FHA and broker business continued to grow. By the end of 2011, the company was servicing loans on properties in 27 states. “We have the range of products and the in-house expertise to more than meet the needs of virtually any multifamily borrower,” Huebscher continued. One of the company’s largest transactions of the year occurred in late March. Beech Street provided $74 million in Fannie Mae conventional loans to refinance a 13-building, 615-unit portfolio of New York City properties owned by the Haruvi family. Meridian Capital Group originated the transaction. The Bethesda-headquartered company has offices in California, New York, Massachusetts, Illinois, Texas, Georgia, Alabama and Washington. The Southern California office opened in 2011, and experienced …

QUINCY, MASS. — Street-Works Development and The Beal Cos. have formed a partnership to develop the $1.6 billion, 3.5 million-square-foot Quincy Center, a transit-oriented, mixed-use development in downtown Quincy. The 20-acre development will include 1.1 million square feet of office space, two hotels, 1,400 residential units and 700,000 square feet of retail space. The companies will be co-managing partners for the project. Additionally, in September 2011, Street-Works formed a joint venture with National Realty and Development Corp. for 400,000 square feet of the retail portion. “The Beal team has been, and continues to be, a driving force behind urban spaces and projects in and around Boston, and we are pleased to have them join us in the rebirth of Quincy,” said Ken Narva, co-founder and managing partner of Street-Works, in a prepared statement. “Our companies share the same vision — to combine financial prudence with entrepreneurial vision and thoughtfulness to create a downtown that will be successful for generations to come,” he continued. “For the past 6 years we have worked with the city and state to develop this vision for Quincy. Our partnership as Beal/Street-Works strengthens the foundation of our work as we continue to move this revitalization toward …

NEW YORK CITY — A 630,000-square-foot enclosed fashion mall, with a new Macy's as its centerpiece, will break ground in the Bronx this spring, with the opening slated for late 2013 or early 2014. Prestige Properties plans to develop a three-level, $270 million mall located on an empty parcel of the Bay Plaza Shopping Center, one of New York City's largest retail centers. The development, named the Mall at Bay Plaza, will be anchored by Macy's, which is slated to occupy 160,000 square feet. “The new Macy's will be a big draw for other retailers to lease space at The Mall at Bay Plaza,” says Sam Shalem, CEO and chairman of Prestige Properties. The mall will also be physically connected to an existing JC Penney store at the Bay Plaza Shopping Center. When complete, Bay Plaza will total about 2 million square feet of retail space. “Asking rent for the new mall will depend on the size of the space and the type of tenant, but will likely range between $100 to $200 per square foot,” says Shalem. Located near the intersection of Hutchinson Parkway and I-95 in the East Bronx, the fashion mall will include 70 to 80 stores. …

PARAMUS, N.J. — Paramus-based HornRock Properties has plans to acquire $125 million in residential and commercial properties in the Northeast in the next 12 months, the company announced on Monday. In alliance with Ontario-based Fieldgate Homes, HornRock Properties will pursue a variety of residential, commercial and mixed-use projects, with a focus on the New York/New Jersey urban and suburban markets. The company, owned by brothers Maurice and David Hornblass, has hired a team of acquisition, architecture, construction, management and marketing professionals to help meet its objectives and address challenges and opportunities. “We’re well-positioned to move on viable opportunities concerning various asset classes, including condos, rentals, single-family, multifamily and distressed assets,” said David Hornblass, principal of HornRock Properties, in a prepared statement. “Our alliance with Fieldgate Homes, one of the most successful and respected developers in the Canadian market, enables us to draw on significant financial resources to close deals quickly, without bank or other traditional lending sources,” he said. The company is working with real estate brokers, develops, lenders and other service providers to identify viable opportunities, including ground-up construction and redeveloping or repositioning assets. “Sellers appreciate that we’re fully committed to every project and are confident in our proven …

CHICAGO — Harrison Street Real Estate Capital (HSRE) has launched the Harrison Street Core Property Fund, the first open-end core fund dedicated exclusively to investing in the demographically driven education, healthcare and storage properties, making it the largest real estate manager focused on these sectors in the United States. “The core fund has already received subscriptions of more than $200 million from limited partnerships, which include both the Texas Municipal Retirement System and Kentucky Retirement Systems,” said Christopher Merrill, co-founder, president and CEO of Chicago-based HSRE, in a prepared statement. The core fund recently acquired the 1,527-bed Sterling Central Apartments, a student housing community located adjacent to the University of Central Florida in Orlando. The property is 98 percent occupied, and includes two 3,000-square-foot clubhouses, two fitness centers, two computer centers, four pools, tanning, a screening room and a shuttle to campus. HSRE stated that it established the fund to capitalize on the experience and knowledge it has gained as the largest owner/manager focusing on investing in these segments of the real estate market. The company believes it will benefit from the relationships it has formed with more than 30 local and regional operating partners who are the domain experts …

Bank profits will be under pressure in 2012, and the industry’s large exposure to commercial real estate isn’t helping matters. That’s the conclusion of data analytics firm Trepp LLC, which emphasizes that troubled commercial real estate loans have accounted for approximately 80 percent of all U.S. bank failures since 2007. With $1.5 trillion of commercial real estate debt still on the books of banks, regulatory concerns persist. “That’s about one-fifth of bank lending overall,” said Matt Anderson, managing director of New York-based Trepp. “And it’s a much higher proportion for smaller banks, which are much more dependent on commercial real estate lending.” Anderson’s comments came during a webinar hosted by Trepp on Thursday that offered a decidedly bearish outlook for the U.S. banking sector. The data analytics firm is forecasting that industry profits will fall 7 percent in 2012, after rising 47 percent in 2011 to an estimated $126 billion. Reduced net interest margins created by the low interest rate environment and flat yield curve will cut into earnings during the next 12 months, said Anderson. Other factors that will cause bank profits to dip include anemic loan growth and a protracted commercial real estate recovery. U.S. banks are implementing …

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 …