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NEW YORK CITY — Philadelphia-based Hersha Hospitality Trust has acquired three recently opened hotels in the Times Square area of New York City. The properties include the 184-room Hampton Inn, the 188-room Candlewood Suites and the 210-room Holiday Inn Express Times Square. The company acquired the hotels for $165 million, which includes approximately 1.45 million units of limited partnership interest in the company’s operating partnership that were issued to the undisclosed sellers. “Expanding our presence in New York City, which has historically been one of the strongest markets in the country, is one of our long-term strategic objectives,” says Jay Shah, CEO of Hersha Hospitality Trust. Hersha was able to acquire the Holiday Inn Express property for an incremental $55 million, which lowered the company’s basis for the three hotels to approximately $284,000 per key, notes Shah. The total purchase price is approximately 12 times the assets’ estimated 2010 pro-forma cash flow. This latest acquisition reduces the average age of Hersha’s hotel portfolio and reduces the average age of the New York City hotel portfolio to 2 years. Currently, the New York metro region accounts for 27 percent of the company’s hotel rooms. Hersha Hospitality Management manages the three properties. …

MIAMI — Miami-based homebuilder Lennar Corp. has purchased an interest in two portfolios of distressed loans currently held by the Federal Deposit Insurance Corp. (FDIC) with a combined unpaid balance of $3.05 billion. The portfolios contain approximately 5,500 residential and commercial real estate loans obtained by the FDIC from the receiverships of 22 failed banks.Approximately 21 percent of loans are secured by commercial real estate properties. Lennar acquired a 40 percent interest in a limited liability company created by the FDIC to hold the loans for approximately $243 million, including up to $5 million in working capital to be contributed by Rialto Capital Advisors, a subsidiary of Lennar that will manage and work out the loans. The FDIC will retain the remaining 60 percent interest in the LLC and will provide $627 million of non-recourse financing at a 0 percent interest rate for 7 years. “Acquiring and working out distressed real estate loans was a large and extremely profitable part of our business during the last major real estate down cycle in the early 1990s,” said Stuart Miller, president and CEO of Lennar Corp., in a statement. “We are pleased to return to this business and honored to partner with …

CLAYTON, MO., AND PORTLAND, ORE. — KBS REIT II, an affiliate of KBS Companies, has acquired two trophy office properties in Missouri and Oregon. The first property is Pierre Leclede Center, a two-building, 5.1-acre campus located in the St. Louis suburb of Clayton. The two towers rise 16 and 24 stories, and total 579,846 square feet of Class A office space. Amenities include a fitness center, a cafeteria, a conference center, a car wash, two full-service banks and a three-story private dining club. The buildings were built in 1964 and 1970, and they received $7.6 million in renovations since 2006. Occupancy was more than 94 percent at the time of closing. The second property is One Main Place, a 20-story tower located in Portland's central business district. Constructed in 1982, the building is one of the city's largest towers at 315,133 square feet. It is 99 percent occupied by a tenant roster that includes Education Northwest, Tripwire and Ball Janik. The property's most recent renovation resulted in an Energy Star rating from the EPA. KBS is no stranger to either of these markets. In Clayton, KBS REIT I purchased the 16-story Plaza in Clayton office tower in September 2006. In …

WASHINGTON, D.C. — President Obama unveiled several proposals this week aimed at helping small business owners. The proposals will expand two critical Small Business Administration (SBA) lending programs, one of which could help some in the commercial real estate industry. One of the new SBA initiatives will temporarily allow for the refinancing of owner-occupied properties under the SBA 504 program, which provides guarantees on loans for the development of real estate and other fixed assets but could not be used to refinance maturing debt up until this point. Under the new initiative, businesses with a loan maturing in the next year, and who are current on their loan payments, will be able to refinance up to 70 percent of the current property value, with the SBA helping with the remainder. For less established lenders, the SBA will take on up to 40 percent of the property's value for the refinancing. The program will be funded through additional fees for refinancing projects instead of through a Congressional appropriation. The refinancing proposal will help refinance up to $18.7 billion a year in commercial real estate that would otherwise be foreclosed on or liquidated. In a statement, SBA Administrator Karen Mills said, “Thousands …

ABINGTON, PA. — After a lengthy approval process, construction has begun for Switchville Crossing, a mixed-use redevelopment project located in the Philadelphia suburb of Abington. The property, which is located at the intersection of Highland Avenue and Wharton Road, was formerly the home of sheet metal fabricator Willard Inc. but has been vacant for several years. Duke Real Estate Partners purchased the property in 2005 with the intent of redeveloping it into a commercial retail project. Countless meetings with local officials and citizens groups refined the idea, and in November 2009, Duke was approved to construct a mixed-use retail and office project. The first retailer at the new Switchville Crossing project will be LA Fitness, which is scheduled to open in late 2010. The next component to be built will be a three-story office building with ground-floor space for retail and restaurants. Completion of this building will come in 2012. Finally, a 3,000-square-foot outparcel will be developed at a later date. Demolition of the current industrial building has already commenced, and vertical construction will follow soon after. “This exciting new project will bring life to a property that has been vacant for 8 years,” said Stan Casacio, principal of Duke …

NEWARK, N.J. — Newark's Prudential Center will soon see more activity with the announcement of a new hotel and retail project to be constructed adjacent to the arena. Plans call for a new 150-room Courtyard by Marriott hotel and 15,000 square feet of ground-floor retail space. Both components will connect to the Prudential Center, greatly increasing the draw of this downtown entertainment destination. “This hotel project will bring more to Newark than 150 new downtown hotel rooms — it will create jobs for our residents and bring foot traffic to our small business owners,” said Cory Booker, mayor of Newark, in a statement. The Marriott hotel will be developed by Robert Finbarb Cos. and managed by Marriott International. It will utilize the company's new prototype hotel and will feature meeting space, a lounge, a swimming pool and a fitness center. The retail space will be leased and managed by Tucker Development Corp. Groundbreaking is expected to occur later this year. “This new hotel and retail development will continue our downtown's transformation into a vibrant, mixed-use, 24/7 community,” said Stefan Pryor, Newark deputy mayor for economic and housing development, in a statement. Prudential Center was constructed in 2007. Known best as …

SPRING, TEXAS — Construction is under way in Spring for one of the greenest schools in the Houston area. Gloria Marshall Elementary School is being built to LEED-Gold specifications and has already been approved for the EPA's Energy Star award. The project will also meet the criteria for the Collaborative for High Performance Schools, the nation's first green building rating program designed specifically for K-12 schools. Designed by the Houston office of SHW Group, the school will rise two stories and contain 105,000 square feet of space. One of its most innovative features is a geothermal HVAC system expected to save the school 25 percent in energy consumption over a traditional HVAC system. Classrooms will feature south-facing windows that will take advantage of daylight harvesting, and light sensors will dim and brighten the room's lights depending on the level of sunlight present — which is expected to keep classrooms lights turned off 75 percent of the time. Renewable energy options for the school include an on-site wind turbine and photovoltaic solar panels located on the roof. The building's roof will also be a reflective white to lower the amount of solar heat absorbed by the building. The exterior of the …

BIRMINGHAM, ALA. — Birmingham-based Bayer Properties has announced plans for the renovation of downtown Birmingham's historic Pizitz Building. The $60 million project will convert the building, which has stood vacant for more than two decades, into Class A office and retail space. The seven-story structure, which is located at 1821 Second Avenue North, will include approximately 169,000 square feet of office space, 23,000 square feet of ground-floor retail and restaurant space, and 20,000 square feet of building amenities and storage space. Construction is anticipated to begin this summer, with the building reopening in 2012. Some of the building's original features, including its terra cotta façade, first-floor mezzanine and storefront display windows, will be preserved or restored as part of the project. Bayer is applying for LEED certification as well as Historic Preservation Certification. KPS Group is the project architect. Two tenants have already signed on for the building's office component. Bayer Properties will move its corporate headquarters to the building upon completion. Joining the company will be law firm Baker, Donelson, Bearman, Caldwell & Berkowitz. The Pizitz Building was designed by local architect Henry Wheelock and constructed in 1923. It originally served as the flagship location for the Alabama department …

ST. LOUIS — St. Louis was witness to a blockbuster deal this week as Bank of America Plaza was sold for $47.85 million. While both parties involved were undisclosed, the buyer was a Los Angeles-based private investor that was able to close on the deal quickly. The buyer's representatives were Geoff Tranchina and Scot Tiano, who represent the Investment Sales Group of Southern Caolifornia-based Wilson Commercial Real Estate. The 30-story, Class A trophy tower is located in the heart of St. Louis' central business district. The property totals 749,857 square feet. It was 90 percent occupied at the time of closing by a tenant roster that includes Bank of America, Pricewaterhouse Coopers and Ralcorp Holdings. Amenities include a Bank of America retail branch, a full-service cafeteria and a connected parking garage. With the decreased number of investment sales closing lately, valuing assets has become increasingly challenging. Many sellers do not know what the price of a property should be to get it sold, and buyers, always hungry for a deal, are on the lookout for the next distressed asset or seller trying to unload a property at any cost. Deals such as this provide guidance. “This deal will help, moving …

GAINESVILLE, TEXAS — Fort-Worth, Texas-based limited partnership Woodcrest Alliance has purchased Gainesville Factory Shops for an undisclosed amount. The 319,653-square-foot outlet retail center is located at 432 Interstate 35N in Gainesville, near the Texas-Oklahoma border. The property was built in 1993. It is tenanted by stores and outlet brands from Dress Barn, Gap Outlet, Rocky Mountain Chocolate Factory, Kasper, Oshkosh B'Gosh, Perfumania, Reebok, SAS, Sunglass Hut, Van Heusen, Rue 21, Zales Outlet and others. Jon McDaniel of Woodcrest Real Estate represented Woodcrest Alliance in the purchase. The seller was a group of 11 lenders led by Business Partners LLC. The group was represented by Greg McDonald of The Weitzman Group. — Coleman Wood