Finance
Institutional Investment
Prudential, Lillibridge Partner on $30M Equity Deal
Jul 30, 2009
Healthcare real estate firm Lillibridge has received a $30 million equity commitment from Prudential Real Estate Investors to fund future developments and acquisitions. The investment by PREI is the firms’ fourth equity venture together, with PREI having been among Lillibridge’s initial investors when the firm first raised equity in April of 1999. With this latest investment, PREI has funded a total of more than $135 million in equity to Lillibridge. Lillibridge has an ownership interest in approximately 6 million square feet of healthcare real estate in 16 states, with a portfolio including developments and repositionings, along with the company’s stabilized portfolio.
Recent Institutional Investment Headlines
NYPPEX Report Finds Significant Reduction in Prices Paid by Secondary Buyers
Jul 31, 2009
Global secondary private market advisory, trading and research firm NYPPEX released a report finding that secondary buyers have been acquiring interests in commercial real estate partnerships at 20 to 40 percent below replacement cost and at 40 to 60 percent below net asset value relative to private equity partnerships, with median secondary bids continuing to decline. Primary concerns, the entity found, include refinancing risk for mortgage loans originated during the 2005 to 2008 period, as well as loan size risk and risks associated with property type.
Economic Update - CalPERS Takes Rating Agencies to Task
Jul 16, 2009
Another California trend? CalPERS, the nation's largest pension fund, has filed suit against the three largest credit-ratingsagencies, essentially asserting that the agencies gave away highratings like gold stars to kindergartners back in the days when realestate only went up. Or to use the language of the lawsuit, "wildlyinaccurate and unreasonably high" ratings on various structuredinvestment vehicles caused the pension fund to lose a cool billiondollars.
SL Green Lands $145M for Refinancing of NYC Office High-Rise
Aug 06, 2009
Flying in the face of the still chilly credit market, SL Green Realty
Corp. has managed to get its hands on a $145 million leasehold mortgage
for the refinancing of the 1.2-million-square-foot office tower at 420
Lexington Ave. in Midtown Manhattan.
In Wake of CityCenter Suit, Another Vegas Project Looks to Move Forward
Mar 25, 2009
As one Las Vegas mega-project hits a snag, the site for a possible new
development is set to go up for auction. Just a day after the
announcement of a lawsuit brought by a co-developer of the massive
CityCenter project against its partner comes word that a 22-acre parcel
for a proposed Asia-themed casino resort will be sold at a bankruptcy
auction in May.
Prices Drop in Second Quarter, MIT Index Finds
Aug 03, 2009
Prices for commercial real estate dropped at a record level in the second quarter despite an increase in sales, according to an index developed by the Massachusetts Institute of Technology Center for Real Estate. In a report released on Monday and first appearing on Reuters, the center quoted its index as finding that property sold by major institutional investors dropped 18.1 percent, to a level that is down 22 percent for the year, 32 percent from a year ago and 39 percent from its mid-2007 peak, despite transaction volume that increased for the first time since last summer. The decline is greater than the 27 percent drop in the late 1980s/early 1990s and even with it when adjusted for inflation, which brings both periods to a 41 percent drop.
Economic Update - MIT/CRE Index Takes Hit in 2Q09
Aug 05, 2009
Commercial real estate took a drubbing in the second quarter, according
to Massachusetts Institute of Technology Center for Real Estate, whose
index tracking commercial properties sold by institutional investors
dropped 18.1 percent during 2Q09. The index is down 32 percent from the
end of 2Q08, and 39 percent from its mid-2007 (that is, bubble) peak.
Economic Update - Panning for Gold in CRE Debt
Jul 22, 2009
Federal Reserve Chairman Ben Bernanke, high oracle of the U.S. economy,
began two days of testimony before Congress on Tuesday, and said that
things will slowly get better, eventually. He also noted that he and
his banking brethren are watching developments in the commercial real
estate industry--that ticking time bomb--with all the attention that a
ticking time bomb deserves. Meanwhile, down in the trenches, there's a
gold rush of sorts going on to find profits in real estate debt.
Economic Update - Recovery or Continued Slowdown?
Jun 17, 2009
Is the economy picking up or continuing to struggle? It seems to depend upon who you talk to and when you talk to them. While many reports gave a variety of accounts Tuesday, most supported bets that the pace of the recession is slowing.
U.S. Infrastructure at Crossroads: Report
Apr 21, 2009
With $132 billion having been set aside in the stimulus package for road, highway and various other transit related projects across the United States, the issue of the country's outdated infrastructure is at the forefront. The Urban Land Institute and Ernst & Young note in a new report that while the funding will certainly boost the job market, what is of even more vital importance is a long-term infrastructure plan for digging the nation out of an economic slump and shoring up the country to be competitive on an international level in the future.
Cadillac Fairview Buys 49% Interest in NY Macerich Center
Jul 31, 2009
Cadillac Fairview Corp. purchased a 49 percent interest in Macerich's Queens Center in the New York City borough of Queens for $150 million in net cash. The eighth joint venture between the two firms, the venture gives Canadian Cadillac Fairview, wholly owned by the Ontario Teachers' Pension Plan, entree to New York City. Queens Center is the top-performing asset in Macerich's portfolio: The 966,499-square-foot urban retail center, which at year-end 2008 was 97.5 percent occupied, was at that time producing annual mall sales of $876 per square foot. Macerich purchased it in 1995 and redeveloped and expanded it in 2004.
Economic Update - Home Price Uptick? Sort Of
Jul 29, 2009
On the heels of news Monday that new home sales were up a little, home
prices inched up as well--at least, those measured by the Standard
& Poor's/Case-Shiller Home Price Index in its raw form. In May, the
index, which measures prices in 20 metropolitan areas, rose 0.5 percent
over April, following a 0.6 percent drop the month from March to April.
The movement is notable as the first time the index has moved up in
three years.
Economic Update - Credit Woes Put Kibosh on $2.5B Midway Deal
Apr 21, 2009
Citi Infrastructure Investors--a joint venture of Citigroup Inc., John Hancock Life Insurance Co. and Vancouver Airport Services-- will be unable to go through with a deal that would have seen the group buy Midway International Airport in Chicago for $2.5 billion. After previous extensions, the City of Chicago decided not to give the group any more time to close on the deal.
MBA: Outstanding Mortgage Debt Remains Unchanged in First Quarter
Jun 19, 2009
The level of commercial mortgage debt outstanding remained relatively unchanged in the first quarter, at $3.48 trillion, according to the Mortgage Bankers Association analysis of the Federal Reserve Board Flow of Funds data. The $3.48 trillion in commercial/multi-family mortgage debt outstanding recorded by the Federal Reserve was a decrease of $33 million from the fourth quarter of 2008. Multi-family mortgage debt outstanding grew to $908 billion, an increase of $5 billion, or 0.6 percent from the fourth quarter.
Economic Update - Bear Stearns' Bum Real Estate, Revealed
Apr 24, 2009
Bear Stearns Cos. was in the news again Thursday, in case anyone
remembers back far enough to recall the last time it was big news--a
time when the disappearance of that company into JPMorgan Chase seemed
unfortunate, but not necessarily a harbinger of vast financial problems
ahead. Which, in fact, it turned out to be.
Rockwood Latest Investor to Close Fund, Raising $964M
Apr 29, 2009
Hoping to capitalize on an unsettled real estate environment that could ultimately lead to the "best investment period in the last 20 years," private real estate investment firm Rockwood Capital L.L.C. has closed an investment fund with some $964 million in capital commitments.
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