Global real estate funds continue to grow their "dry powder," or unspent capital, as opportunities to invest remain scarce, according to Preqin. It reports that funds had $237 billion ready to invest in commercial property at the end of 2016 -- an increase from $229 billion the prior year.
Fitch Ratings says there will be continued pressure on commercial mortgage-backed securities, and projects "significant delinquencies" on loans maturing this year that are highly leveraged and expected to have difficulty refinancing. The exception should be the multifamily asset class, which saw a delinquency rate decline of 338 basis points in 2016, to end the year at 0.81%.
Retail center owners are benefiting from the trend of online retailers moving into physical spaces; as they expand, many fill empty mall space with pop-ups or long-term leases, such as Amazon's upcoming store in Manhattan's Time Warner Center. A newer trend among online stores is to open centers in malls where customers can return items they bought on the internet.
Rising residential and commercial property values in Brooklyn outpaced the rest of New York City's boroughs for the fiscal year beginning July 1, 2018, according to tax assessment data. Property values in Brooklyn rose 14%, while those in Manhattan rose 8.24%.
The 75,781-square-foot Brookside Shops, in Acton, Mass., has been sold to Clarion Partners for an undisclosed amount. The property sits in an area with an average household income of $123,000 and is anchored by a Trader Joe's.
In a deal handled by Marcus & Millichap, Flagler Station Shops in Miami has been sold to a local investment group for $9.6 million. The Class A property was built in 2001 and was 95% occupied at the time of the sale, with retail and office tenants.
Village at Fairview, a 1 million-square-foot retail center in Fairview, Texas, will get a $50 million renovation by new owner Lincoln Property Co. The renovations include removing 50,000 square feet to add open space and improve traffic flow on the 200-acre project, and the property will be renamed Fairview Town Center.
Retail Properties of America (RPAI) has purchased Main Street Promenade, which includes a 103,000-square-foot shopping center and 79,000 square feet of office space, in Naperville, Ill., for $88 million. The property is 93.1% leased, and the transaction includes a vacant parcel for up to 62,000 square feet of additional mixed-use space.
A Brookfield Strategic Real Estate Partners II affiliate will invest up to $400 million in American Realty Capital Hospitality Trust on a delayed draw basis. As part of the investment, Brookfield reportedly will have some governance rights over ARC Hospitality, the REIT's board will undergo changes, ARC Hospitality will terminate the existing advisory agreement and become self-managed, and it will be renamed Hospitality Investors Trust.
Corporate Office Properties Trust is planning on more sales in 2017 as well as development, according to its guidance for the year. It expects to close between $80 million and $90 million in property sales, about $20 million in land sales and $240 million to $260 million in development.
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