Philip Blumberg Blog

Washington Capitol Partners Buy Symphony Woods

Washington Capitol Partners LLC has purchased the Symphony Woods Office Center in Columbia, Maryland for $15.6 million according to a Business Journal article. The 93,850 square foot building, trading hands at $166 per square foot, was sold by Liberty Property Trust, represented by brokers Jon Carpenter, Jay Wellschlager, Phil Iglehart and Dennis Malone of Colliers Investment Services Group.

"With the continued uncertainty in the credit markets, the very strong interest level generated for Symphony Woods was a testament to the quality of the asset," Carpenter said in the news release. The six-story Class A building is a part of the Columbia Town Center and is currently 94% leased with tenants including Manpower and Keeney Financial Group Inc.

For more real estate news and information, visit Blumberg Capital Partners.

House Rejected New Bailout Bill

In a 205 to 228 vote, the House of Representatives shot down a newly negotiated financial rescue plan Monday afternoon. After a week of intense debate in both party caucuses, House members opposed the bill just five weeks before they face voters in an election that is shaping up as a referendum on the economy. The announcement sent the Dow Jones spiraling down over 600 points today, with a slight recovery before the closing bell.

Bill leaders met strong resistance from a liberal wing that opposed bailing out Wall Street's corporate executives and a conservative wing that denounced the measure as an abandonment of free-market principles. Weekend negotiations produced a few compromises that brought the endorsement of GOP leaders, most notedly a provision that requires the Treasury secretary to establish a new federal insurance program, funded by the banks, that would protect firms against losses from troubled assets. After the legislation was unveiled Sunday, both McCain and Obama endorsed it as a necessary step to avert economic disaster. It is widely acknowledged that something must be done to unfreeze the credit markets, which have all but ceased operating in the last few weeks.

"If the legislation is indeed moribund -- as it seemed to be on Monday afternoon -- then the baton will pass quickly to the Fed and other central banks to deal with the fallout -- which would be further tightening of credit conditions and upward pressure on borrowing spreads," said Brian Bethune, chief U.S. financial economist for Global Insight in a Washington Post article. "At a minimum we would be looking for the Federal Reserve to cut interest rates sooner rather than later."

For more real estate news and information, visit Blumberg Capital Partners.

Blumberg Capital Partners Video

Average homeowner mortgage woes: Philip Blumberg of Blumberg Capital Partners discusses what the average homeowner in trouble with their mortage can do to survive, and make the best decision for their life and finances. For more real estate news and information, visit Blumberg Capital Partners.

Joint Venture Secures Two Massachusetts Office Buildings

A joint venture between Taurus Investment Holdings and DivcoWest has purchased two office buildings in North Reading for an undisclosed price from Teradyne, Inc. The deal was brokered by Dave Pergola and Mark Reardon of CB Richard Ellis' New England office. "This is DivcoWest's sixth acquisition in the Boston area and we continue to believe there will be more opportunities to grow our portfolio in the New England market," said Stuart Shiff, president of DivcoWest.

The two buildings are located at 300 & 400 Riverpark Dr. within the Riverpark Office Park, a one-million-square-foot complex. The 300 property contains 150,000 square feet and the 400 property, a light industrial/R&D building, contains 200,000 square feet according to a Boston Business Journal article.

For more real estate news and information, visit Blumberg Capital Partners.

Forest City Closes $250 Million in Financing for DC Project

Forest City Enterprises, Inc. has closed on $250 million in n non-recourse construction financing for the initial phase of its Waterfront Station project in Southwest Washington D.C. "Waterfront Station is poised to become a leading mixed-use property in Southwest D.C., and a catalyst for further redevelopment and economic revitalization within this quadrant of the District," said Charles A. Ratner, Forest City president and chief executive officer.

At full build-out (expected to deliver in 2010 according to a GlobeSt.com article), Waterfront Station is expected to include 1.2 million square feet of office space, 1,000 residential units and a minimum of 110,000 square feet of stores and restaurants. The site is adjacent to the Waterfront/Southeastern University MetroRail station. The financing includes the project's first two buildings, totaling 628,000 square feet of office and ground-level retail space. The office component is fully leased to the District of Columbia for various governmental offices, and the retail component will include a Safeway supermarket, a CVS pharmacy, and other retail tenants.

The project is being developed by Waterfront Associates, a joint venture between affiliates of Forest City Washington, Inc., Bresler & Reiner, Inc. and Vornado/Charles E. Smith.

For more real estate news and information, visit Blumberg Capital Partners.

Blumberg Capital Partners in the News

A Blumberg Property Fund LP property sale was recently featured in the Tampa Bay Business Journal: Arthur Hill & Co. buys older office building in Westshore.

An excerpt:

Blumberg Property Fund LP sold its three-story office building at 550 N. Reo St. in the Westshore Business District for $9.3 million, or about $122 a square foot.

Blumberg Capital Partners, based in Coral Gables and one of Florida's largest institutional real estate investment managers, had owned the Class B building for more than a decade.

 

LAs Citigroup Center Sells for $280M

Houston, Texas-based Hines has purchased the Citigroup Center in downtown Los Angeles, Calif., for $280M from New York City-based Broadway Partners. The 48-story tower is located at 444 Flower St. in the Bunker Hill/financial district. Built in 1981 and designed by AC Martin & Associates, it contains 891,056 square feet and was renovated in 2004.

Currently 95% occupied (the leasing of which has been handled by Jones Lang LaSalle), Citigroup Center's signed tenants include a law firm, a gourmet sandwich shop and the Bank of China. The law firm, Fairbank & Vincent, will be relocating to the building from West Los Angeles and have signed a five year lease for 3,142 square feet on the 38th floor. The gourmet sandwich shop, Mendocino Farms, has signed a 2,120 square foot lease on the ground floor and Bank of China, the eighth largest bank in the world, has signed a seven-year, 14,573 square foot renewal valued at $3.8 million for its offices on the full 39th floor.

"Bank of China's long-term renewal is a testament to the commitment of foreign banks doing business in Los Angeles," says Jones Lang LaSalle managing director John McAniff to GlobeSt. "Fairbank & Vincent's move to downtown reinforces the continuing trend of West Los Angeles firms migrating downtown, and Mendocino Farms is a new, successful retailer drawn to the vibrancy of Downtown Los Angeles."

For more real estate news and information, visit Blumberg Capital Partners.

Blumberg Capital Partners Video

Are We in a Recession? Philip Blumberg of Blumberg Capital Partners discusses the conventional definition of recession and the actual state of the economy, loss of equity, and reckless risks in underestimating available debt contraction and low liquidity. For more real estate news and information, visit Blumberg Capital Partners.

Houston Office Market Hurt by Ike

Hurricane Ike swept through Houston early on the morning of September 14th and left a path of $18 billion in damages, the third costliest storm in US history. Prior to Ike, Houston's office market was reporting encouraging numbers: according to a CB Richard Ellis report, Houston's office market recorded an 11.7% vacancy rate in 2Q 2008 while the national average trailed at 13.8%, and the unemployment rate was at 4.9% in July against the nation's 5.7% as Houston added 57,1000 new jobs in the past year according to the Texas Workforce Commission.

Now, as the city remains under a 9-6 curfew through Friday, owners, managers and investors are starting to evaluate the damage done according to a National Real Estate Investor article. Downtown Houston, one of the areas hardest hit by Hurricane Ike, is home to the 75-story JPMorgan Chase Tower (Texas' tallest office building) which saw most of its eastern windows from the ground floor to the 40th blown out at the height of the storm. Chip Clare, president of the Gulf Coast region for Houston-based Transwestern, describes the pattern of damage across the city as "indiscriminate." He estimates that about 30% of Transwestern’s management portfolio was back in operation by Tuesday, but fewer than 50% of those tenants are reporting to work. "Most people have figured out a way to work remotely. They are also resourceful. A guy came into the office today because we had air conditioning and his house didn’t."

"The fact that the hurricane went through won’t change the fact that we’ll continue to look there," says David Steinwedell, executive vice president of AIC Ventures, an Austin-based company that has completed more than $500 million in sale-leaseback deals. "As long as Houston has a viable economy it’s going to be a good investment market. You might have higher insurance costs, but if their economy stays on course, guess what? Money is going to go there to invest."

For more real estate news and information, visit Blumberg Capital Partners.

Boston Building Sells for $167M to German Company

GLL Real Estate Partners of Munich, Germany has paid $167 million for 200 State Street, a 302,143-square-foot retail and office building in downtown Boston according to crefeed.com. Constructed in 1985, the property includes 100 indoor parking spaces as well as retail space on the ground floor known as Marketplace Center. The property sits in the middle of the Financial District and retains a current 99% occupancy, boasting tenants Eaton Vance, Beacon Capital Partners, the Parthenon Group and law firm Morgan, Brown & Joy, among others.

The German investment manager purchased the 16-story building from Broadway Partners, which had purchased it roughly a year ago as part of a large portfolio of properties from Beacon Capital Partners. It is said to have allocated a price of $145 million to its purchase at the time. "This is a first-class trophy asset in one of North America's premier office markets," said Barry McGowan, GLL's chief investment officer. "We plan to make it a central part of our expanding U.S. portfolio over the long term." The property is encumbered by $60.5 million of senior debt and a similar amount of mezzanine debt. The senior debt was securitized through Lehman Brothers Floating Rate Commercial Mortgage Trust, 2007-LLF C5. It's not known if GLL will assume the financing.

For more real estate news and information, visit Blumberg Capital Partners.