Colony Capital, a real estate manager, has combined with its real estate investment trust, Colony Financial, to emerge as a bigger REIT. After last week's initial public offering, the REIT has a $2.87 billion market capitalization.
U.S. District Judge Paul Gardephe sentenced Mathew Martoma, a former portfolio manager for Steven Cohen's SAC Capital Advisors, to a nine-year prison term for his role in what prosecutors said was the most profitable insider trading conspiracy in history. The judge said the sentence took into account the $275 million profit SAC got from illegal trading in pharmaceutical shares.
Debt is becoming available to a broader segment of the commercial real estate market, participants at the Commercial Real Estate Finance Council conference said. The B piece is also strengthening. Some reservations were expressed, though. "It seemed like most attendees felt as though the market is headed in the right direction in 2013, but there is still some nervousness," said Marielle Jan de Beur, managing director and head of structured products research CMBS and real estate research for Wells Fargo Securities.
There is plenty of opportunity in commercial real estate and REITs now, says Host Hotels & Resorts President and CEO Ed Walter, who is the new chair of NAREIT. In large part this is due to the robust debt and equity markets, he says. "Admittedly, cap rates are lower, and part of the reason for that is we have both an optimistic outlook on growth and an abundance of capital. When you look at CRE pricing compared to alternate investments, there's a pretty healthy premium."
Starwood Property Trust and Starwood Capital Group LLC are buying LNR Property LLC for $1.05 billion.
Starwood Property will pay $856 million for most of the distressed asset manager's business units. That includes LNR's special servicing unit and half of its stake in Auction.com.