As 2015 begins, the Raleigh-Durham market continues to see heavy investment and development interest in the multifamily sector. Strong fundamentals, including an influx of young professionals lured by healthy job growth, an emergent live-work-play atmosphere and an economy that has continued to outpace its national counterpart, justify the area’s reign as one of the most attractive non-gateway markets in the country. The healthy, long-term fundamentals are challenged by an apartment construction pipeline that is among the nation’s most active, but so far the market is performing remarkably well. Construction starts in the area have exploded during the last two years, and there are now 8,835 units under construction throughout the Triangle area, with an additional 4,919 units proposed, according to Real Data. Whether demand can keep up with supply has been a widely debated topic among real estate analysts. The high number of units delivered represents an increase in supply of 9.3 percent over the past 24 months. Strong demand has shielded the region from notable occupancy declines. In the first half of 2014, 2,453 units were absorbed and 2,642 new units were completed, providing a differential of only 189 units, according to Real Data. Average vacancy ticked up to …
CHARLOTTE, N.C. — Prudential Mortgage Capital Co. has provided a $44 million acquisition loan to a joint venture between Stockbridge Capital Group and TriBridge Residential for Venue, a 366-unit luxury apartment community in Charlotte’s Elizabeth neighborhood. The 10-year loan was structured with a fixed interest rate and features interest-only payments for the full term of the loan. Completed in November 2014, Venue’s Class A units include hardwood floors, granite countertops and stainless steel appliances, and the community amenities include a theater room, grilling areas and a resort-style pool. The Elizabeth neighborhood is less than three miles from Charlotte’s central business district and is close to a 1.5-mile streetcar project, which is currently under construction. Prudential Mortgage Capital Company is the commercial mortgage lending business of Prudential Financial Inc.
SAN FRANCISCO — Loews Hotels & Resorts, a wholly owned subsidiary of Loews Corp. (NYSE: L), has entered into an agreement to purchase the 158-room Mandarin Oriental, San Francisco hotel. The purchase price was undisclosed. “We are excited to find a property that is consistent with the Loews brand,” Paul Whetsell, president and CEO of Loews Hotels & Resorts, told REBusinessOnline.com. “This will be our first entree into San Francisco, a major gateway market and a very important location for Loews’ core customer base,” he added. The acquisition is expected to close in late March, at which time Loews will rebrand the hotel. Whetsell declined to comment on plans for the rebranding. Located in San Francisco’s Financial District, the hotel, which is currently managed by Mandarin Oriental Hotel Group, is situated on the top 11 floors of San Francisco’s third-tallest office building, 345 California Center, located at 222 Sansome St. The hotel, located one-half mile from iconic Union Square, features unspoiled views of San Francisco and its bay, 158 guest rooms, the Brasserie S&P restaurant, more than 5,000 square feet of meeting space and a new 8,000-square-foot spa and fitness center. The Mandarin Oriental, San Francisco hotel is the seventh …
CHEVY CHASE, MD. — Capital One Bank (NYSE: COF) has served as lead arranger, administrative agent and bookrunner for loans totaling $150.6 million for the acquisition of nine Class A medical office buildings in North Carolina and Georgia. CNL Healthcare Properties Inc., a Florida-based real estate investment trust (REIT) focused on acquiring and developing properties in the seniors housing and healthcare sectors, was the buyer. Five of the properties are located in and around Charlotte on three Novant Health campuses. Of the remaining four, one is located in Asheville, N.C., on a Duke LifePoint campus; another is in Rome, Ga., at Floyd Medical Center; and two properties near Atlanta are satellite offices for Southern Regional Medical Center. Together they total 907,300 square feet of rentable space. Certain properties have ground leases that prohibit cross-collateralization. As a result, Capital One financed them through individual term loans, consolidating the remaining properties into a single loan. “This transaction highlights the structural flexibility we offer clients across the country, as well as our capacity to accommodate a deal of this size,” says Todd Gordon, managing director of Capital One Bank. “CNL Healthcare is one of the premier organizations in the industry, and we are pleased …
MCLEAN, VA. — Hilton Worldwide Holdings Inc. (NYSE: HLT) will acquire five landmark hotel properties with proceeds from its recent $1.95 billion sale of the Waldorf Astoria New York to Anbang Insurance Group Co. Ltd., a Chinese company. The properties include Hilton Orlando Bonnet Creek in Orlando, Fla. (1,001 rooms); Waldorf Astoria Orlando in Orlando, Fla. (498 rooms); The Reach, A Waldorf Astoria Resort in Key West, Fla. (150 rooms); Casa Marina, A Waldorf Astoria Resort in Key West, Fla. (311 rooms); and Parc 55 in San Francisco (1,024 rooms). The Parc 55 will be a new addition to the Hilton Hotels & Resorts brand, which Hilton Worldwide will manage. Hilton Worldwide currently manages the other acquired hotels. The five hotels are expected to be part of a 1031 like-kind exchange. The total purchase price of these five hotels of $1.76 billion represents approximately 13 times the midpoint of the five properties’ combined full-year projected 2015 adjusted EBITDA of between $132 million to $138 million. As part of its long-term relationship with Anbang, Hilton Worldwide will continue to operate the Waldorf Astoria New York under a 100-year management agreement. Anbang also plans to complete a major renovation to restore the …
MENLO PARK, CALIF. — Prologis Inc. (NYSE: PLD) has sold a 21-building, 56-acre industrial park in Silicon Valley to Facebook Inc. (NASDAQ: FB). Menlo Science & Technology Park is located on Willow Road between Highway 101 and the Dumbarton Bridge in Menlo Park. Prologis has owned and managed the property since 1998. “Land constraints and increased urbanization pressures in markets such as Silicon Valley support the monetization of select infill assets,” says Michael Curless, chief investment officer of San Francisco-based Prologis. “This project and others in our portfolio benefit from our dedicated team who understand how to identify and unlock the intrinsic value in our value-added conversion properties.” The sales price was not released, but the Silicon Valley Business Journal estimates that the asset traded for roughly $400 million. As part of the transaction, Prologis will provide ongoing management services on behalf of Facebook. Social networking heavyweight Facebook has roughly 890 million daily active users and roughly 1.4 billion monthly active users, according to its fourth-quarter 2014 earnings report. The Menlo Park-based company invested roughly $1.8 billion in property and equipment in calendar year 2014. “Our team has spent the past several years planning the conversion of this site for …
FORT WORTH, TEXAS – RadioShack (NYSE: RSCH) filed for Chapter 11 bankruptcy Thursday after years of struggling with sluggish sales and competing against online retailers. General Wireless agreed to acquire between 1,500 and 2,400 RadioShack U.S. company-owned stores. This acquisition facilitated the bankruptcy filing from RadioShack and some of its U.S. subsidiaries. General Wireless is an affiliate of hedge fund Standard General L.P. It is also Sprint’s biggest shareholder. The sale agreement is subject to court approval and other conditions. RadioShack’s foreign subsidiaries and its franchisee-owned stores are not included in the filing. Other parties will also have an opportunity to submit offers for RadioShack’s assets in a court-approved process. General Wireless has partnered with Sprint to create a new dedicated mobility “store within a store” retail presence in up to 1,750 of the acquired stores. RadioShack currently has about 4,000 company-owned stores in the U.S. The stores that aren’t purchased by Sprint and its affiliates will close through a deal with liquidation firm Hilco Merchant Resources. The 94-year-old RadioShack was suspended from the New York Stock Exchange on Monday. It was known for selling break-out successes, such as the all-electronic calculator and one of the first mass-marketed computers back …
FRAMINGHAM, MASS. AND BOCA RATON, FLA. — Staples Inc. (Nasdaq: SPLS) will acquire Office Depot Inc. (Nasdaq: ODP) for $6.3 billion. The deal comes a little more than a year after Office Depot Inc. and OfficeMax Inc. merged in 2013. Staples will acquire all of the outstanding shares of Office Depot. Under the terms of the agreement, Office Depot shareholders will receive, for each Office Depot share, $7.25 in cash and 0.2188 of a share in Staples stock at closing. Each company’s board of directors unanimously approved the agreement. Based on Staples closing share price on Feb. 2, the transaction values Office Depot at $11.00 per share. This represents a premium of 44 percent over the closing price of Office Depot shares as of Feb. 2, and a premium of 65 percent over the 90-day average closing price of Office Depot shares as of Feb. 2. “This is a transformational acquisition which enables Staples to provide more value to customers, and more effectively compete in a rapidly evolving competitive environment,” says Ron Sargent, Staples’ chairman and CEO. “We expect to recognize at least $1 billion of synergies as we aggressively reduce global expenses and optimize our retail footprint. These savings …
Abundant financing, unrelenting demand in an undersupplied industry and low rates are driving Northern New Jersey’s multifamily investment market toward pre-recession levels. Nowhere is this more evident than in the urban commuter hub of Hudson County. Known as an integral part of New Jersey’s Gold Coast, Hudson County serves as one of the most active investment and rental markets in the region thanks to its proximity to Manhattan and high concentration of multifamily properties. Long-term owners in the area increasingly are aware of the market conditions, and trading has started to approach unprecedented levels. A prime example was the recent $21 million sale of a four-property Hudson County multifamily portfolio, with units located throughout Jersey City and Hoboken. The deal marks one of the most highly bid sales in Hudson County this year, with more than 20 competitive offers submitted for the portfolio consisting of 159 apartments and six commercial units. Following three rounds of bidding, the seller, which had owned the property for more than 40 years, accepted the highest non-contingent offer. All of the properties were fully occupied at the time of sale, and the largest — a mid-rise elevator building on Magnolia Avenue in Jersey City — …
NEW YORK — AvalonBay Communities Inc. (NYSE: AVB) has purchased the Manhattan home of the American Bible Society, located at 1865 Broadway in the Upper West Side, for $300 million. AvalonBay intends to raze the organization’s headquarters and use the 22,500-square-foot site to construct a 300,000-square-foot apartment tower, which will include retail at the base. The society will remain in the building through the third quarter of 2015. AvalonBay expects to begin construction on the tower in late 2016. The building currently located at 1865 Broadway is a 12-story, 156,000-square-foot Class C office building that was constructed in 1965. According to media reports, the American Bible Society, which has been located in the building since construction, will relocate to the Philadelphia area. The site is located within two blocks of iconic Manhattan locales such as Columbus Circle, Lincoln Center and Central Park. The retail component at the base of the tower could be comprised of nearly 60,000 square feet of leasable space, according to some media reports. AvalonBay has indicated that in the future it may enter into a joint venture or forward sale agreement with respect to the retail component. Helen Hwang, Nathaniel Rockett, Karen Widenmann and Brian Szczapa …