CLEVELAND, TEXAS — Partners Real Estate has negotiated the sale of a 14,800-square-foot industrial building in Cleveland, located about 50 miles northeast of Houston. The site at 699 US Highway 59 S. spans 17.7 acres. The building was constructed in 2007 and features 24-foot clear heights, according to LoopNet Inc. Wyatt Huff and Hunter Stockard of Partners represented the seller and occupant, farm equipment provider Rakesales, in the transaction. Paul Compton of JLA Realty represented the buyer, American Friction Inc.
NEW YORK CITY — Vornado Realty Trust (NYSE: VNO) is nearing completion of a $750 million repositioning of PENN 2, a 1.8 million-square-foot office building that sits atop the Penn Station transit hub in Midtown Manhattan. PENN 2 will sport architectural features such as a modern glass curtain wall, a triple-height lobby that opens onto a new plaza on 33rd Street and a six-story podium comprised of 105,000 square feet of column-free, double-height space. Above the 33rd Street plaza is a 280-person town hall space with a flexible seating system that can support large-scale keynote talks, private media screenings, banquets, conferences, workshops and open-floor exhibitions. PENN 2 also offers 72,000 square feet of outdoor green space, including an outdoor terrace atop the podium and a landscaped 17,000 square-foot rooftop park that is available to all tenants. The building sits across the street from Madison Square Garden, which houses its global headquarters within the office space. The larger PENN District campus is home to major tenants such as Meta, Morgan Stanley, Amazon, The Hartford, Cisco Systems and Samsung. “The reimagined PENN 2 appeals directly to innovation-oriented companies seeking an ultra-premium, hospitality-infused office environment that offers a one-seat ride for workers throughout the …
LOS ANGELES — The University of California, Los Angeles (UCLA) has acquired One Westside and Westside Two, located two miles from its Westwood campus in Los Angeles. A joint venture between Hudson Pacific Properties (NYSE: HPP) and Macerich (NYSE: MAC) sold the assets for $700 million. The 700,000-square-foot property — located at 10800, 10830 and 10850 W. Pico Blvd.— was formerly occupied by Westside Pavilion mall, a city landmark that served as the backdrop for a number of movies and television shows since its opening in 1985. Hudson Pacific and Macerich began redevelopment efforts at the property in March 2018, converting the mall into a Class A office campus. Google inked a lease in January 2019 to occupy the entire campus under a 14-year term, which was to commence upon completion of the project in 2022. Details of the termination of Google’s lease at the property were not disclosed. The university plans to convert the property into UCLA Research Park, which will house the California Institute for Immunology and Immunotherapy at UCLA and the UCLA Center for Quantum Science and Engineering. The acquisition was made possible by a $500 million investment from the state of California, $200 million of which …
It would be impossible to write a development or design article without mentioning the elephant in the room — the state of the capital markets and the current hurdles in securing financing of any sort, but especially for new development projects. While demand for new communities exists in many markets, getting projects to pencil out is the tricky part. For those developments that can move forward, innovative architecture and design are being employed to make the projects as functional and efficient as possible. Out are some of the flashier amenities from the days of yore, and in is design that helps student residents be the happiest and healthiest versions of themselves, both mentally and physically. From the developer perspective, there is no question about the desire to build — especially in Power Five university markets. “Almost all of the Power Five universities have seen 7 percent to 10 percent rental rate increases over the past three years and are showing approximately 98 percent occupancy at most properties,” says Greg Faulkner, president of Humphreys & Partners Architects. “But math has to work with the rates, like equity requirements of 45 percent or higher. Hard costs have moderated, but some are still …
— By Juan Huizar, President, Sage Real Estate — Nationwide, multifamily sales are declining, while interest rates are rising. Buyers are adopting a patient approach, leading to properties lingering on the market for extended periods. This, of course, is accompanied by noticeable price reductions. Buyers are anticipating further price drops, while some sellers are slowly becoming more realistic in their pricing. Long Beach has perennially attracted multifamily investors with more than 7,500 individual apartment buildings. This is mainly composed of older housing stock, which creates a fertile ground for investors and syndicators. Often regarded as the last affordable beach city, Long Beach — despite being overshadowed by other Southern California communities or grouped with Los Angeles — stands as a significant population and employment hub, ranking as the sixth-largest city in California. Existing apartment sales for properties with five or more units have plummeted by more than 65 percent. Notably, 2021 was an exceptional year due to a confluence of factors, including rising real estate values and a low cost of capital. The current decline is more a reflection of increased capital costs than a trend over the past decade, with some properties selling for less than their 2019 prices. …
SAN JOSE, CALIF. — Urban Catalyst, in partnership with a trust affiliated with the late local architect Thang Do, has completed the disposition of an approved multifamily development site in San Jose. The Santa Clara Valley Transportation Authority (VTA) acquired the asset for $23.4 million. The deal enables the buyer and a group of local government and transit agencies to redevelop the Diridon Station area. The transaction includes 1.2 acres spanning two adjacent parcels at 32 and 60 Stockton Ave., situated between a Whole Foods Market and SAP Center. Urban Catalyst acquired the site in two separate transactions for $15.1 million in 2021 and last year. Working with Do and his firm, Aedis Architects, Urban Catalyst received entitlements for a 20-story, 472-unit development project called Apollo. The project involved demolishing existing structures on the Stockton Avenue and replacing them with apartments ranging from studios to three-bedroom units. The planned development was unilaterally approved last year by the city. After Apollo received planning approval in November 2022, it was discovered that the site is within an area anticipated for future rail infrastructure, as a designated property among the right-of-way parcels needed for the first phase of California’s bullet train. VTA and the …
DURHAM, N.C. — IBM Corp. (NYSE: IBM) has sold a portion of the IBM 500 Campus in Durham, a city near Raleigh. The Armonk, New York-based computer hardware giant sold the property in a sale-leaseback deal. The price was not disclosed, but the Triad Business Journal reports it traded for $66 million. Located at 4205 S. Miami Blvd., the four-building property spans 774,000 square feet and is 100 percent leased to IBM. No plans were announced, but multiple media outlets report that the property is suited for future mixed-use redevelopment opportunities. The IBM 500 Campus sits on 146 acres next to Research Triangle Park (RTP), the largest research park in the United States. RTP is a district in the Raleigh-Durham metropolitan area that houses 375 private companies in technology and life sciences sectors who can draw talent from three established research universities: Duke University, University of North Carolina at Chapel Hill and North Carolina State University. IBM has had a presence in the RTP since the mid-1960s. Hines Global Income Trust Inc., a REIT managed by Houston-based Hines, purchased the IBM 500 facilities and leased them back to IBM. In addition to this acquisition, the firm is a partner developer on …
The New Orleans retail market is in a state of flux like other markets across the country. The retail experience is changing for the end user, with an increase in online shopping, “try before you buy” customers and quicker walkthroughs. Retailers are left in an odd position, caught between experiential interactions with customers and trying to have them remember to purchase later at home. While the retail market is changing, the Greater New Orleans area is different due to the scarcity of space available for new construction and a stable flow of stores closing or relocating. Our market creates a streamlined experience where consumers have “retail corners” they can visit to shop — such as downtown New Orleans, especially the iconic streets of Canal and Magazine — but also the suburbs that include Metairie, Elmwood and the Westbank. With the concentrated shopping setup of the market, customers can shop more efficiently, and retail investors see the New Orleans market as a more demanding and creative place to build and open stores. Submarket by submarket The retail customer in New Orleans detests spending unneeded time in the car, so when customers can shop locally, get what they need and get it …
ALEXANDRIA, VA. — A partnership between developer JBG Smith (NYSE: JBGS) and Monumental Sports & Entertainment (MSE) has unveiled plans to build a mixed-use entertainment district totaling approximately 9 million square feet in Alexandria, just south of Washington, D.C. Anchoring the project will be a new arena for the NHL’s Washington Capitals and NBA’s Washington Wizards within National Landing, an area encompassing the interconnected neighborhoods of Potomac Yard, Crystal City and Pentagon City. Additionally, plans call for a global corporate headquarters for MSE, a Monumental Sports Network media studio, a Wizards practice facility, a performing arts venue and an e-sports facility. The development will be situated adjacent to the Virginia Tech Innovation Campus, the recently delivered Potomac Yard-VT Metro station and approximately 8.1 million square feet of future development opportunities. Project costs are estimated at $2 billion, according to The Washington Post. The project, which is pending legislative approval and completion of documents, is slated for completion by the end of 2028. The Capitals and the Wizards would relocate to Virginia beginning in 2028, should the proposal become finalized. The Capitals and the Wizards currently play at Capital One Arena in Washington, D.C. MSE says it is exploring the …
PHILADELPHIA — PREIT (OTCQB: PRET), a mall REIT giant based in Philadelphia, has filed for Chapter 11 bankruptcy protection. The “prepackaged” bankruptcy was agreed to ahead of time by PREIT’s creditors, which will shorten the duration of the company’s bankruptcy proceedings. PREIT expects it will be able to emerge from bankruptcy by early February 2024. PREIT owns and operates 18 malls in New Jersey, Pennsylvania, Massachusetts, Maryland, Virginia, Michigan, North Carolina and South Carolina. The company has also expanded in recent years to the multifamily, hotel and healthcare sectors. According to PREIT’s third-quarter financial results, the company’s same-store net operating income declined 5.3 percent year-over-year. Additionally, its total mall occupancy was 93.6 percent, a decrease of 70 basis points from third-quarter 2022. Joseph Coradino, chairman and CEO of PREIT, cites a trifecta of COVID-19 disruptions, inflation and rising interest rates as leading to its voluntary filing with the U.S. Bankruptcy Court for the District of Delaware. “Following the pandemic disruption, PREIT has worked tirelessly to enhance the portfolio, dramatically improve occupancy and diversify its tenancy,” says Coradino. “However, unusual economic conditions have limited the company’s options with respect to its debt obligations as meaningful achievements on the operating front were …