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GLOBAL COMMERCIAL REAL ESTATE MARKET ROUNDUP
- Cofinance of France Enters Western New York Market With $42.58 Million Stake
- Luxury Oak Grove Apartments in Novato, CA Sold for $16 Million.
- East River Plaza Retail Center in Manhattan Gets $214 Million New Loan Infusion.
- TPG Capital of Fort Worth, TX and Green Property of West Central England Form $1 Billion Acquisition-Targeted Joint Venture.
- Digital Realty Trust of New York City Closes $377 Million Stock Sale.
Cofinance of France is New Player in Western New York
Cofinance of Hackensack, NJ, the U.S. subsidiary of commercial real estate developer Cofinance Group SA of Luxembourg, paid $24.76 million in two transactions to buy the Youngmann Plaza at 746-900 Young St., near the Youngmann Highway, and the Tops Plaza Tonawanda, 100 Niagara St.
The total includes $17.3 million for the Young Street property and $7.4 million for the Niagara Street site.
Cofinance used another $18.32 million to buy two Tops plazas in Rochester, one in Elmira and one in Arcade, Wyoming County. The seller was Cleveland, OH-based Developers Diversified Realty (NYSE: DDR), DDR is unloading certain commercial assets to firm up its balance sheets, according to several recent published reports.
Cofinance spent a total $42.58 million and acquired a total 703,000 square feet of retail space.
That equates to about $61 per square foot - a bargain when compared to new comparable construction costs of about $150 per square foot, according to local construction industry sources. The 318,166-square-foot Youngmann Plaza was the largest acquisition.
Both plazas are anchored by Tops stores. The 4.1-acre property, which also includes 1,669 parking spaces, is located off Exit 2 of the highway, at the intersection of Young and the Twin Cities Memorial Highway. About 7,900 square feet are available for lease, according to the Buffalo News.
The 2.2-acre site includes 105 parking spaces. About 9,144 square feet of space is available for lease. The 97,014-square-foot plaza is located near the Niagara River at the corner of River Road, on the border of the City of North Tonawanda.
"We like grocery-anchored deals to begin with, and we really like Tops," said Nicholas Koluch, Cofinance's investment manager in charge of acquisitions. "They're a grocer that's on the move in a good way. They're a great operator, and they're local, which you need to be to run a successful grocery franchise."
Since the founding of its primary French unit, Cofinance SAS, more than 35 years ago, the company has been involved in projects totaling more than $2 billion in value, according to its web site.
The U.S. subsidiary, which was formed in June 1983, owns property in New York City, New Jersey and Florida. With its latest deals, it now has about 1.7 million square feet of space, with more than $150 million in assets under management, Koluch said.
"This is a sizable deal for us. And it feels good to be getting a deal done in this difficult marketplace when there's not too many deals going on," Koluch said.
Nathan Benderson
With the real estate and financial crises, and ensuing recession, DDR has found itself struggling for liquidity and forced to unload properties to get cash.
It sold 11 strip mall properties back to Benderson last year for a total of about $160 million, including $142.25 million for eight properties in Western New York, according to the Buffalo News. The company has also sold individual parcels to other buyers. Bendeerson remains active in Western New York Nathan Benderson is CEO of Benderson Development Co.
Oak Grove Apartments in Novato, CA Sold for $16 Million
Oak Grove Apartments, an 88-unit, 75,666-square foot luxury apartment complex in Novato, CA has been sold for $16,055,000. The price represents $182,443 per unit and $212 per square foot.
Brad Pennington, a first vice president investments and a director of Marcus & Millichap's National Multi Housing Group in San Francisco, represented the seller, an unnamed local family partnership, and the buyer, an unidentified San Diego-based owner/operator of apartment communities, condo-conversion projects and office buildings throughout California.
"Oak Grove Apartments is the premier multifamily community in this submarket," says Pennington. "The previous ownership had been in place for the past 10 years."
Brad Pennington
Built in 1998, Oak Grove Apartments sits on six separate parcels of land totaling approximately 6.16 acres. The complex consists of eight three-story residential buildings, seven enclosed garage buildings and a freestanding fitness center.
The buildings are wood-frame construction with stucco and wood exteriors on slab foundations. The roofs are pitched-composition shingle and the property has ample parking for 204 cars.
The unit mix is comprised of 55 two-bedroom/two-bath apartments ranging from 893 to 1,089 square feet and 33 one-bedroom/one-bath units ranging from 636 to 870 square feet. The large individual units all have washers and dryers, one-car garages and either a patio or a balcony. Seven storage closets are available for tenants to rent.
Marin County is bordered to the north by Sonoma County and to the west by the Pacific Ocean.
Forest City Closes $214 Million Loan for 527,000-SF Retail Center in Harlem, NYC
Cleveland, OH-based Forest City Enterprises, Inc. (NYSE:FCEA and (NYSE:FCEB) has closed on the conversion of a construction facility for the East River Plaza retail center in Manhattan to a $214.3 million ($107.2 million at the Company's pro-rata share) term loan.
East River Plaza is a 527,000-square-foot retail center built on the site of the former Washburn Wire factory in Harlem. The factory stood vacant since the early 1980s prior to the beginning of work on the retail center.
The site was initially acquired by Blumenfeld Development Group, Ltd., a full-service real estate development firm with core strengths in big-box retail and office space.
Ed Blumenfeld
"This is a great outcome for East River Plaza and for the public/private partnership that made it possible," Charles A. Ratner, Forest City president and chief executive officer, said in a prepared statement.
"We appreciate the continuing support and commitment of our lenders in executing this conversion. I also want to acknowledge the work of our Forest City Ratner team and our joint venture partner, Ed Blumenfeld and his team, in closing this conversion and in making the overall project to date a great success."
Green-TPG Joint Venture Flashes $1 Billion Acquisition Flag
The Irish Times reports a new joint venture company with €900 million of debt and equity ($1 billion US) to invest in distressed property assets is ready to roll.
Green Property of West Midlands, England has joined forces with Fort Worth, TX-based TPG Capital to target commercial real estate opportunities in Britain and Ireland. The new company is called Green TPG Partners.
Green Property chairman Stephen Vernon will serve as chairman and Green managing director Pat Gunne will be chief executive of the newly formed entity. Vernon described the partnership as a "very powerful combination of capital and experience unlike any other in the market".
TPG was founded in 1992 and has $48 billion of assets under management. Green's investment portfolio has an annual rent roll of €100 million, half of it from the Blanchardstown Town Centre.
Green Property owns Blanchardstown Town Centre, a 3.15 million-square-foot lifestyle center in the Dublin suburb of Blanchardstown. Blanchardstown Town Centre is considered by industry analysts as the largest retail, leisure and destination project in Ireland.
Green TPG Partners is expected to concentrate initially on troubled portfolios, including shopping centers in the United Kingdom, according to the Irish Times.
The joint venture will also seek partnerships with government agencies and financial institutions to "help manage their exposure to the sector".
The company may also opt for a joint venture arrangement with developers unable to fund the completion of retail and office schemes, according to the newspaper.
Digital Realty Raises $370 Million from Stock Sale
Digital Realty Trust (NYSE:DLR), a New York City-based wholesale data center provider, has generated gross revenue of $370 million on the sale of its common stock.
Priced at $57 per share, the company sold the entire six million shares and an additional 900,000 shares reserved for underwriters' over allotment option.
The company's stock rose to $60.63 per share after the sale closed. It is currently trading in the $62 to $63 range.
The proceeds will be used to finance a portion of the company's $725 million acquisition of the five-property 365 Main portfolio from its former owner, Rockwood Capital. 365 Main will manage the portfolio.
In addition to the stock sale, the company plans to fund the transaction using available cash and its revolving credit facility.
The acquisition adds 919,000 square feet of space, consisting of data centers and undeveloped property in San Francisco, El Segundo, CA and Oakland, CA, Chandler, AZ and Chantilly, VA.
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