tag:blogger.com,1999:blog-36129932718497731252024-03-12T20:24:09.243-04:003.0% CapCommercial Real Estate Rumors & ReportsUnknownnoreply@blogger.comBlogger46125tag:blogger.com,1999:blog-3612993271849773125.post-87273757396705571732009-07-09T09:14:00.003-04:002009-07-09T09:23:55.904-04:00Treasury Picks 9 for PPIPSome big commercial real estate players on the list:<br /><br /><p></p><blockquote style="font-style: italic;"><p>Following a comprehensive two-month application evaluation and selection process, during which over 100 unique applications to participate in Legacy Securities PPIP were received, Treasury has pre-qualified the following firms (in alphabetical order) to participate as fund managers in the initial round of the program:</p> <ul><li>AllianceBernstein, LP and its sub-advisors Greenfield Partners, LLC and Rialto Capital Management, LLC;</li><li>Angelo, Gordon & Co., L.P. and GE Capital Real Estate;</li><li>BlackRock, Inc.;</li><li> Invesco Ltd.;</li><li>Marathon Asset Management, L.P.;</li><li>Oaktree Capital Management, L.P.;</li><li>RLJ Western Asset Management, LP.;</li><li>The TCW Group, Inc.; and</li><li>Wellington Management Company, LLP.</li></ul></blockquote>The AG&Co/GE Partnership has at least $5 billion of real estate AUM between them, and each have well-known and highly-thought-of management teams. I would guess BlackRock has somewhere in the neighborhood of $3 billion. Marathon $800 MM and Oaktreee $600 MM. (Pure guestimations on my part -- I'm sure their respective websites include some information on the real estate portfolios.)<br /><br />What strikes me, though, is (a) the fact that so-called "manipulative" and "excessively speculative" hedge funds and private equity funds are pretty much the only ones chosen, and (b) how distressed Oaktree and Marathon's real estate portfolios are. These are the managers Treasury chose?<br /><br />I guess since the Treasury itself is trying to manipulate markets and overpay for assets, some of these selections make a little more sense. <blockquote></blockquote>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-72318583099659642982009-07-06T12:43:00.003-04:002009-07-06T12:51:52.149-04:00What a bizarre two years it has been...I originally started this blog in 2007, when it was common that trophy commercial real estate assets would trade for 3% cap rates (cap rate = property-level net operating income divided by property value). I felt the market correction coming -- albeit not nearly to the extent that we are experiencing today, nor the extent to which I think we'll see in the next couple of years.<br /><br />Two years later, I'm at my second company since leaving the boutique i-banking firm, including 15-month pit stop at one of the biggest hedge funds on the Street (where my strategy proceeded to blow up). And I, like everyone else, am wondering -- where do we go from here?<br /><br />The people who used to read this blog are probably long gone. Most who worked in the CRE industry in New York have left for less-competitive locales. So I'm really just posting this to see if it's picked up on anyone's RSS feeds.<br /><br />I dropped everything when I went to the hedge fund to focus 100% of my time on the strategy. Now that I have a bit more time on my hands, I'll probably resume blogging regardless of whether anyone reads it. It's amazing to me that since I started this, there still have been no blogs about commercial real estate that have popped up given everything that's going on. It's an incredibly interesting time, yet no one seems interested.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-89438859683647186002007-08-09T12:21:00.000-04:002007-08-09T12:24:40.364-04:00Grace Under Pressure<a href="http://equityprivate.typepad.com/ep/2007/07/grace-under-pre.html">This story from Going Private</a> is the funniest and frighteningly accurate take on the market I've read.<br /><br /><em><blockquote>"So that's become the story everywhere. I mean it's not that we can get debt so long as we pay more, almost no one is actually issuing any. I mean any. Lots of firms have standstills. Total standstills." Suddenly, what was an amusing tale of non-sex becomes an alarming warning.<br /><br />"Well, I can see how the larger debt issuances might be an issue, but how much were you trying to score?" I ask.<br /><br />"I wasn't trying to score. He's cute, but not that cute."<br /><br />"Bad choice of words. How much debt?"<br /><br />"Oh, that was for Project Yonkers, so $450 million?" Now I am more alarmed. "You can't get anyone to pick up $450 million?"<br /><br />"Well, I haven't tried everyone yet, but I've never gone 48 hours without even getting a term sheet before." I am stunned. Laura is bored.</blockquote></em><a href="http://equityprivate.typepad.com/ep/2007/07/grace-under-pre.html">Read the whole thing</a>.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-57836102394345948872007-08-09T11:45:00.001-04:002009-07-06T16:54:46.620-04:00In the TankAnd I thought <a href="http://threecap.blogspot.com/2007/05/its-new-dawn-its-new-day.html">the second quarter was bad</a>.<br /><br />One-Month LIBOR shot up overnight to 5.54%, crushing DSCRs on floating rate deals that -- until today -- were the only reliable way to finance large transactions. Forget finding fixed-rate financing -- 3Cap's friends at Deutsche, Wachovia, LaSalle, and Credit Suisse aren't even quoting. The few, the brave few who ARE quoting are giving notice that their quotes are good for about 24-hours, and any terms provided are subject to market conditions.<br /><br />A good friend at Citigroup has sized up 2 deals since the weekend. Neither are likely to transact.<br /><br />And now, I'm sure you've read that <a href="http://www.bloomberg.com/apps/news?pid=20601087&sid=aUIoRzrktg4M&refer=home">BNP Paribas has frozen 3 funds</a>, <a href="http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a2rP8XvO7WV4"><i>a la</i> Bear Stearns</a>, citing the "fact" that they couldn't "fairly" value their holdings.<br /><br />Rumor has it that Wachovia may report sizable losses in its CMBS lending and securitization operations from aggressive loans that they haven't been able to securitize. But given that Wachovia is one of the faster banks on the street to clear loans off their shelves, I find it hard to believe that there won't be several others (if the rumor is true, of course).<br /><br />Most b-note players are out on the golf course for the rest of the month, as subordinate financing becomes more scarce by the day. No one can finance their originations via CDOs, so why bother?<br /><br />I keep hearing the first-year guys and summer associates yell in delight about how the 10-yr Treasury yield has fallen 10 bps this morning, as if the 10-year matters right now.<br /><br />The New York Sun says the <a href="http://www.nysun.com/pf.php?id=60134&v=3073766811">mayhem may actually be good for the markets</a>. Wha? In what time frame? And for whom? Certainly lower leveraged pension funds, maybe insurance companies and balance sheet guys in the short term. But long term? How is it "good for the markets" when you cut transactions by at LEAST 50% over the course of at least the next year??Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-80706121796953692772007-05-25T20:02:00.000-04:002007-05-25T20:03:29.041-04:00Happy and Safe Long WeekendI'll be working, as well as many of you. Luckily, I'll be working from a hotel in a warm and sunny locale, a thousand miles from the City.
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<br>Blogging via email from a plane on the runway at EWR right now, I can't help but look across the aisle at strangers chatting each other up and thank God for these tiny planes with only one seat on the left side of the plane. A window seat and an aisle seat in one - and no "consultant" bragging about his latest regional award.
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<br>Everyone have a fun and safe weekend.Unknownnoreply@blogger.com2tag:blogger.com,1999:blog-3612993271849773125.post-53747628294862431202007-05-24T18:01:00.001-04:002007-05-24T18:06:44.004-04:00Who Cares about LA Real Estate?Apparently I spoke too soon. Another major portfolio is about to trade in Southern California. Should make headlines sometime mid-next week. $1.5 Billion-plus deal.<br /><br /><strong>Update:</strong> Well, I should check <a href="http://www.globest.com/">GlobeSt</a> before I post from now on. They've picked up the story already (apparently just posted, because it wasn't even in the PM Alert sent at 4:40 PM ET) that a <a href="http://www.globest.com/news/914_914/losangeles/160928-1.html">GICSA affiliate is purchasing the old Arden SoCal Portfolio for about $1.5 billion</a>.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-47318824906055915402007-05-22T17:33:00.000-04:002007-05-22T17:34:24.737-04:00iStar Buys Fremont's CRE Lending Business for $2 BillionIn a deal that was being kicked around the rumor mill for about a week, <a href="http://www.globest.com/news/912_912/losangeles/160868-1.html">iStar announced it is acquiring Fremont's commercial real estate lending business</a> for $2 billion.<br /><br />Mr. Condocon Verter, a New York-based real estate investor, hated to hear the news, as it took one of the two remaining lenders out of the market who were dumb enough to still be lending on condo projects (even in South Florida). Mr. Verter was overheard saying as his head hung low, "At least there's still <a href="http://www.cpnonline.com/cpn/specialties/article_display.jsp?vnu_content_id=1003581727">Corus</a>."Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-3155240931306901162007-05-18T13:02:00.000-04:002007-05-18T13:04:58.687-04:00Wachovia, Deutsche Bank Producers Grumbling?There's a rumor making the rounds that Wachovia's originators are complaining their latest pricing sheet is up to 30 bps wide of the competition, essentially putting them on the beach and out of the game. <p>Deutsche Bank is rumored to be sitting on the sidelines as well. Word is that the guys at both banks aren't too happy, and aren't sure if this is temporary or the proverbial "writing on the wall". </p><p>If you are job hunting, lock up a place ASAP, because I have a sneaking suspicion that the pool of candidates in the market right now (already wider than usual) could get even wider in June.</p>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-91453001734411978722007-05-18T10:03:00.000-04:002007-05-18T10:10:09.400-04:00A Hungover Friday Morning Link Rundown<a href="http://www.costar.com/News/Article.aspx?id=947EFBF0E2823598F35CBC138112E5D3">Fortress Acquiring Flagler Development for $3.5 Billion</a> (CoStar)<br />Apparently bought all-cash, which is somewhat surpring. I would say that is may be due to the fact that development firms which aim for quick development and exits tend to be low on operating cash flow, especially in today's environment where less buyers are buying on in-place income and rather focusing on future stabilized cash flows and/or values... but Flagler has a sizable portfolio of owned assets. In any event, it's definitely the news of the day [yesterday].<br /><br /><a href="http://www.forbes.com/feeds/ap/2007/04/20/ap3635584.html">Mathias named SL Green President</a> (Forbes)<br />Notorious BSD Andrew Mathias has been promoted to president of SL Green and will keep the CIO title as well (of both SLG and Gramercy Capital). Previously, CEO Marc Holliday was President of the company as well. Said Holliday, "Andrew could make eight kajillion bazillion dollars if he were to start something up himself, so I'm perplexed that he accepted my offer of a title upgrade and some extra pocket change." ...Or maybe that's just what I said ... to myself.<br /><br /><a href="http://www.earthtimes.org/articles/show/news_press_release,108051.shtml">NAR: Commercial Real Estate Investment Expected to Remain Strong</a> (EARTHtimes.org)<br />Don't ask how I happened upon an EARTHtimes link, but its really just a press release from the National Association of Realtors which cites the fact that more dumb money is being thrown at commercial real estate deals in 2007. "Investment in commercial real estate rose 11 percent to a record $306.8 billion in investment-grade transactions in 2006, with office buildings leading the way."<br /><br /><a href="http://www.observer.com/2007/broadway-partners-closes-buys-237-park-100-wall">Broadway Closes on 237 Park, 100 Wall</a> (NY Observer)<br /><i>The Real Estate</i> pokes a little fun for their "announcement" when everyone already knew about the transaction <a href="http://www.observer.com/2007/broadway-partners-closes-buys-237-park-100-wall">via the same blog two months ago</a>.<br /><br /><a href="http://www.commercialpropertynews.com/cpn/article_display.jsp?vnu_content_id=1003586973">If a high-rise is developed in downtown LA, does it make a sound?</a> (CPN)<br />I don't know many people who care much about Los Angeles real estate, <a href="http://www.forbes.com/realestate/2007/02/21/maguire-eop-blackstone-pf-guru-in_ps_0221realestateintelligence_inl.html">save for Maguire Properties</a>, I'm sure... but according to CPN, "Plans have been announced for Park Fifth, a high-rise residential and hotel complex in Downtown Los Angeles. Africa Israel and Namco Capital Group are serving as the capital partners for the $1 billion project, which is being developed by Houk Development Co." It will be the tallest residential property west of Chicago at 76 stories on Fifth and Olive (and another 43-story tower). It will include 732 condos, a 220-room five-star hotel and a 15-story bridge linking the two towers. Groundbreaking will take place in Q1 2008.<br /><br />Everyone drink lots of water and be liberal with the Aleve!Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-19120565642209065762007-05-14T17:28:00.000-04:002007-05-14T17:28:12.171-04:00GlobeSt: Marathon Real Estate Files $200M IPOMarathon filed their IPO papers with the SEC on Friday <a href="http://www.globest.com/news/905_905/newyork/160623-1.html">for a $200 million IPO and REIT classification</a>. According to the linked GlobeSt.com story, the company controls assets totaling about $1.3 billion, including $886 million of assets financed in a CDO. More than 50% of their portfolio is in New York or California. About 25% is in hospitality and about 23% is in office.<br /><br />Credit Suisse and Lehman are the underwriters.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-7500946415622084462007-05-11T23:52:00.000-04:002007-05-11T23:53:00.501-04:00It's a New Dawn, It's a New DayAfter the busiest three weeks of my life, I'm trying to get back into the routine of posting here. Oh, how much has changed in the past 17 days...<br /><br />Forget what you thought you learned about today's CMBS world during the last 18 to 24 months - it's been flipped faster than the EOP portfolio. With the subprime meltdown, ratings agency warnings, and activist CMBS buyers at all levels serving as catalysts, the CMBS market underwent an enormous adjustment seemingly overnight. Banks re-traded loan apps on their some of their most successful and profitable clients, several banks made it be known that they are out of the 10-year interest-only lending business for good, some borrowers unable to obtain financing walked away from hard deposits, and one of the go-to funding sources for large deal financings went POOF -- literally -- overnight.<br /><br />Some of the biggest news items since the hiatus:<br /><br /><a href="http://www.crenews.com/ME2/dirmod.asp?type=CRE&nm=CRE&mod=News&mid=A7B0FE85D23A4DB9B5581E6AACFFBE01&tier=3&id=83CD730A6D3847DD80F30A6F59293DB8">CMBS Spreads Widen from Top to Bottom</a> (IPG/CRE News [$])<br />From the top classes to the B-Pieces, CMBS spreads widened. Most see it as a result of S&P and Fitch warnings about law underwriting and new ratings standards. Some point to the subprime mortgage fallout for why CMBS buyers are feeling a little jittery. Either way, it's affecting everyone from the borrowers to banks with un-securitized loans still on their books.<br /><br /><a href="http://www.crenews.com/ME2/dirmod.asp?type=CRE&nm=CRE&mod=News&mid=A7B0FE85D23A4DB9B5581E6AACFFBE01&tier=3&id=2B574C94E8784F49B324113359DA1564">Institutional Real Estate Cap Rates Hit Record Lows</a> (IPG/CRE News [$])<br />Something has to give, but it didn't happen in the first quarter, as cap rates dropped even further across all property types, according to Bank of America. Marketwide, the average cap rate hit 5.61%, which continued a now 9-quarter decline. For those scoring at home, that's a less than a 100-bp spread on today's Ten-Year at 4.652%. Fantastic.<br /><br /><a href="http://www.reuters.com/article/bankingfinancial-SP/idUSWNAS983820070504">60 Wall Trades for $1.18 Billion</a> (Reuters - FREE!)<br />Paramount takes the downtown asset that's been on the market since November 2006. Something may have changed since I last looked at the deal, but the net rentable are should still be 1,625,483 sf, meaning the price was $738 psf, considered a bargain in New York these days. My last underwriting pegged the initial year's NOI at about $64.5 million, which hints at a 5.47% cap rate. That could be off though, since I haven't seen the deal in about 6 months. Looks as though DB got their target price... less about $20 million (only a 1.7% haircut).<br /><br />There's no real articles on the on-going CMBS adjustments and how it's affecting the market (that I've seen), except for the pay publications like Commercial Mortgage Alert, which is proving to be a priceless resource right now.<br /><br />Hoping to find time to post more regularly....<br /><br />3.0%Unknownnoreply@blogger.com2tag:blogger.com,1999:blog-3612993271849773125.post-56614651716797897512007-05-02T19:08:00.000-04:002007-05-10T14:59:30.107-04:00Dillon Read - DONE!?!Can't post much now, but the word is that Dillon Read Capital, a subsidiary of UBS, apparently gathered their employees in the ballroom this afternoon and shut everything down at 5:00 pm... Told everyone not to come to work in the morning. Would be HUGE news in the morning.<br /><br />Rumor goes that they lost a billion dollars plus in the last couple of weeks. I'm sure more info will slowly leak out if proven out, but this is definitely the biggest news in a week that's been full of news (that I haven't had time to post about).<br /><br /><strong>Update Thursday, 9:35 AM:</strong> It sounds like the amount lost noted above was overblown by *just a bit* but the media caught wind of this around 4:30 AM this morning. Click for stories from <a href="http://www.forbes.com/afxnewslimited/feeds/afx/2007/05/03/afx3680188.html">Forbes</a> and <a href="http://www.bloomberg.com/apps/news?pid=20601085&sid=a1AVqIt5qE2s&refer=europe">Bloomberg</a>.<br /><br /><strong>Update Thursday, 5:10 PM:</strong> Although not reported anywhere (that I have been able to find), today's rumor is that Dillon Read was a significant financial backer of New Century, the now-defunct subprime group. This was supposedly responsible for a large chunk of DR's losses.<br /><br />According to <a href="http://www.crenews.com/ME2/dirmod.asp?type=CRE&nm=CRE&mod=News&mid=A7B0FE85D23A4DB9B5581E6AACFFBE01&amp;tier=3&id=C298921960E440ADB236305322D2441B">CRE/IPG</a>, Brian Harris, the BSD of the commercial real estate group will take a similar position with UBS.<br /><br />** ThreeCap's site traffic/visitor count has exploded today due to the news and this post being the first to post anything about it on the web yesterday evening (even though no one wants to leave comments). Welcome to all the new readers - now, don't you all have work you should be doing??Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-24304423439667361432007-04-13T11:08:00.000-04:002007-04-13T11:09:43.380-04:00How to be a Pussy, by Dana MattioliLet me preface this by saying I've never pulled a John Rolfe and sat with two MDs at a cocktail table and pissed into a beer bottle (and on their shoes) at the Christmas Party. But I've also never under-utilized an open bar, and don't plan on putting a halt to my single-barrel lunches.<br /><br />So on that note, Dana Mattioli at CareerJournal.com <a href="http://www.careerjournal.com/myc/survive/20061205-mattioli.html?cjpos=home_bricks">lays out a perfect plan</a> on how to lose your man card, burn out faster and stunt your i-banking career growth. Enjoy!<br /><br /><blockquote><i>Happy Hour: Meeting up with colleagues is not the same as hanging out with personal friends. Let your co-workers order first, so you can gauge what they are drinking, Mr. Karsh suggests. Don't follow the lead if the drink of choice is beyond your normal alcohol tolerance. "If everyone is ordering iced tea, don't order a Long Island iced tea," he says. </i></blockquote>And this, on how to blow an interview:<br /><br /><blockquote><i>Avoid drinking during an interview over a meal. Candidates need to be on top of their game. <u>If the interviewer offers, politely decline, even if your host indulges.</u></i></blockquote>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-68288446659655648852007-04-11T16:00:00.001-04:002007-04-11T16:00:53.904-04:00Moody's: "Conduit Loan Underwriting Continues to Slide - Credit Enhancement Increase Likely"According to <a href="http://www.crenews.com/ME2/dirmod.asp?type=CRE&nm=CRE&mod=News&mid=A7B0FE85D23A4DB9B5581E6AACFFBE01&tier=3&id=01F4DA642E4E48B2B894E2F2CD86AAED">CRE/IPG, Moody's will start increasing subordination levels for CMBS transactions shortly.</a><br /><br />This comes on the heels of <a href="http://home.businesswire.com/portal/site/google/index.jsp?ndmViewId=news_view&newsId=20070402005827&newsLang=en">Fitch stating last week that aggressive CMBS underwriting will lead to more defaults</a>, drawing some parallels between current aggressive lending in the commercial sector with the ongoing subprime fallout (which I thought I linked here last week, but I guess not).<br /><br /><blockquote><i>It said its increases, which would be meted out on a deal-by-deal basis, would amount to the equivalent of a half to a full ratings notch. A full ratings notch increase in subordination would mean that a deal's Baa2 bond class, which today would typically have a 4 percent subordination level, would face a 5 percent level - roughly today's requirement for a Baa1 bond.</i></blockquote>Not all deals will be affected. "Well-diversified collateral pools, a substantial volume of investment-grade loans, and other strong features could still receive subordination levels similar to those granted during the first quarter."<br /><br />So while the other ratings agencies played UN and just talked about it, at least Moody's is doing something about it... you've got to give them credit for that. Although I don't like it because it makes my job tougher, Moody's is the only agency hanging their heads out right now about an issue that all the agencies have weighed in on - the only one to risk their volume of rating assingments by actually changing their guidelines.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-87093002370852817752007-04-11T10:38:00.000-04:002007-04-11T10:41:01.107-04:00Q1 2007 CMBS & CDO League Tables OutBeen out of town a couple of days...<br /><br />According to <a href="http://www.cmalert.com/" target="_blank">Commercial Mortgage Alert</a> (no link to actual story/rankings, you have to pick up the print edition), Morgan Stanley, Wachovia, JP Morgan Chase and RBS Greenwich topped the Bookrunner league tables for the first quarter of 2007. While Morgan Stanley led in Global CMBS and Non-US CMBS, JP Morgan edged them out for the US lead. Wachovia led in the CDO division, and RBS Greenwich came out on top in Agency CMBS.<br /><br />According to CMA, US CMBS issuance was up 32% from a year ago, and and foreign CMBS was up 48%. However, this preceeds another ratings warning (this time from Moody's, which I'll type about when things calm down in a bit) and even an even further widening of mezz spreads.<br /><br /><strong>Top 15 Global CMBS Bookrunner Rankings for Q1 2007 are:</strong><br /><ol><li>Morgan Stanley ($11.84 billion)<br /></li><li>JP Morgan Chase ($9.56 billion)</li><br /><li>Merrill Lynch ($7.84 billion)</li><br /><li>Wachovia ($7.77 billion)</li><br /><li>Deutsche Bank ($6.61 billion)</li><br /><li>Credit Suisse ($4.15 billion)</li><br /><li>Lehman Brothers ($6.08 billion)</li><br /><li>RBS Greenwich ($6.01 billion)</li><br /><li>Citigroup ($4.15 billion)</li><br /><li>Banc of America ($3.73 billion)</li><br /><li>Bear Stearns ($3.03 billion)</li><br /><li>Goldman Sachs ($2.83 billion)</li><br /><li>Barclays Capital ($1.75 billion)</li><br /><li>ABN Amro ($1.43 billion)</li><br /><li>West LB ($523 million)</li><br /></ol><br /><strong>Top 10 US-Only CMBS Bookrunner Rankings: </strong><br /><ol><li>JP Morgan Chas ($9.24 billion)</li><br /><li>Morgan Stanley ($8.45 billion)</li><br /><li>Wachovia ($7.78 billion)</li><br /><li>Merrill Lynch ($7.15 billion)</li><br /><li>Credit Suisse ($4.77 billion)</li><br /><li>RBS Greenwich ($3.74 billion)</li><br /><li>Banc of America ($3.73 billion)</li><br /><li>Lehman Brothers ($3.71 billion)</li><br /><li>Citigroup ($3.68 billion)</li><br /><li>Deutsche Bank ($3.31 billion)</li></ol>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-65395254915352485522007-04-08T20:32:00.000-04:002007-04-08T22:55:44.587-04:00A TV-MA Easter Sunday NightAs far as real estate goes, not much happened during the holiday-shortened weekend. I may post a recap of nothing later, but probably not.<br /><br />Today marks the triumphant return of millions of people's Sundays being centered around HBO instead of work or their families, with <a href="http://www.cnn.com/2007/SHOWBIZ/TV/04/05/sopranos.advancer/">The Sopranos</a> and <a href="http://www.nytimes.com/2007/04/06/arts/television/06ento.html">Entourage</a> finally coming back on at 9:00 PM (Eastern).<br /><br /><a onblur="try {parent.deselectBloggerImageGracefully();} catch(e) {}" href="http://graphics8.nytimes.com/images/2007/04/05/arts/05ento600.1.jpg"><img style="margin: 0px auto 10px; display: block; text-align: center; cursor: pointer; width: 320px;" src="http://graphics8.nytimes.com/images/2007/04/05/arts/05ento600.1.jpg" alt="" border="0" /></a>Here's hoping the Sopranos stops setting up this season and finally goes to the mattresses. And I'd love to see a creative way for Ari to come back to Vince with his tail between his legs, begging to continue to rep him (and maybe Turtle's clients now). <span style="font-style: italic;">"Smoke more weed, Turtle. Seriously. Smoke more weed."</span><br /><br />More to blog about after the shows, if the wine doesn't put me to bed first.<br /><br />* * * * * *<br /><br />Well, I'm disappointed in both. Not much left to say.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-48612244110126251812007-04-07T14:03:00.000-04:002007-04-07T14:09:42.456-04:00Another Banker PersonalHey, just trying to help a brutha out...<br /><br /><a href="http://newyork.craigslist.org/mnh/cas/306693956.html">Busy banker seeks friends-with-benefits situation - m4w - 24 (Upper East Side)</a><br /><br /><span style="font-style: italic;">Yes, the rumors are true: bankers do work long hours. I came out of a long term relationship about 3 months ago and dont have much time, let alone the interest, to pursue women in bars. </span> <span style="font-style: italic;"><br /><br />Looking instead for a girl to hang out with occaisionally... some wine, some 420, some fun, etc. Prefer a petite girl, 18-25. Send me your pic!<br /></span><h2><a onblur="try {parent.deselectBloggerImageGracefully();} catch(e) {}" href="http://d.im.craigslist.org/Hd/xL/hVWqp4RRCEUakcsSKtW9V6VwEFYP.jpg"><img style="margin: 0px auto 10px; display: block; text-align: center; cursor: pointer; width: 200px; height: 261px;" src="http://d.im.craigslist.org/Hd/xL/hVWqp4RRCEUakcsSKtW9V6VwEFYP.jpg" alt="" border="0" /></a></h2>(via <a href="http://www.ibankingoasis.com">i-Banking Oasis</a>)Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-16513960722729042122007-04-05T14:31:00.000-04:002007-04-05T22:35:38.322-04:00Could a Downtown Migration Signal the End of the Midtown Office Craze?An article in CPN this morning on <a href="http://www.commercialpropertynews.com/cpn/property_type/article_display.jsp?vnu_content_id=1003567414">JP Morgan Chase negotiating with the Port Authority to building a 50-story office adjacent to the World Trade Center site</a> implies that a number of blue chip Midtown tenants are exploring possibles moves to downtown.<br /><br />"Overall there is significant sticker shock from some big midtown tenants that are looking downtown. Even the best inventory downtown is trading at approximately half of that ($100 per square foot) at $60 plus or minus a square foot." [So says Brian Given, vice chairman at GVA Williams in Manhattan.]<br /><br />Following up on <a href="http://threecap.blogspot.com/2007/04/trading-floor-envy-at-ny-i-banks.html">this story a few days ago</a>, could we be staring at the beginning of the end of the Midtown office craze?<br /><br />It is well known that very little available office space exists city-wide, let alone in the core Midtown office market from 6th Avenue to Lexington, 42nd Street to Central Park. If the big banks are going to aggressively pursue the types of spaces the recent rumors suggest, one has to believe that new downtown developments will be their only possible solution.<br /><br />Let's not kid ourselves - when comparing a new Class A+ office at $60 per square foot versus a 30-year old Class A office at $100 per square foot, ahead of what many believe to be a rebirth of Lower Manhattan, the cheaper, value-added play will win out every time.<br /><br />The flip side of the coin is that Midtown landlords are forced to drop their rents significantly - perhaps by as much as 25% - to keep these core tenants.<br /><br />In either case, its hard to see the Midtown valuation trend continuing very much longer; it's certainly much easier to see the nearing peak of the price curve.Unknownnoreply@blogger.com2tag:blogger.com,1999:blog-3612993271849773125.post-2706803124443331622007-04-04T16:01:00.001-04:002007-04-04T16:01:57.599-04:00NYO: The 10 Most Expensive New York Office Assets<div xmlns='http://www.w3.org/1999/xhtml'>The New York Observer has <a href='http://www.observer.com/20070409/20070409_John_Koblin_finance_observatory-2.asp'>an incredibly insightful article on the current New York office market</a>, focusing on the 10 most valuable office properties in Manhattan. The ranking is based on a number of conversations they had with local moguls, such as Joe Moinian, Douglas Durst and Larry Silverstein, to well-known brokers like Scott Latham. An excellent read throughout.<br></br><br></br>Their rankings:<br></br><br></br>1. The GM Building<br></br>2. 200 Park (The MetLife Building)<br></br>3. Rockefeller Center<br></br>4. 9 West 27th Street<br></br>5. 245 Park Avenue<br></br>6. 277 Park Avenue<br></br>7. Seven World Trade Center<br></br>8. One Bryant Park (Under Construction)<br></br>9. Four Times Square (Conde Nast Building)<br></br>10. The Seagram Building<br></br><br></br>The Chrysler Building was notably omitted because the Property is encumbered by a ground lease. But I wish they hadn’t lumped all of Rock Center into one big pile. I would have been much more interested to hear how these players see 1211 Avenue of the Americas, less than a year after it traded. Lumping that incredible building with Time Warner’s former building, for example, doesn’t add much value for the reader.<br></br><br></br>Also, 666 Fifth Avenue, just acquired for $1.8 billion by a partnership led by Jared Kushner, who owns the New York Observer, was not included.</div>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-61300065561935357632007-04-04T10:52:00.000-04:002007-04-04T22:39:36.007-04:00A Garden State TuesdaySince a few notable transactions occurred recently in our neighboring state to the west, New Jersey is well rep'd in Tuesdays (delayed) notes:<br /><br /><a href="http://www.cpnonline.com/cpn/specialties/article_display.jsp?vnu_content_id=1003566775">Tishman Speyer bought the 833,000 square foot MetroPark Office Center</a> (CPN) in Woodbridge for an undisclosed amount (although GlobeStreet's DealTracker database pegs it at $200 million, which rounds out to $240 per square foot. While the seller purchased it for $150 million in 2003, Tishman should still see significant appreciation even in the near term as the asset is head and shoulders above much of the surrounding market (with very little ongoing development in the immediate area).<br /><br /><a href="http://www.crenews.com/ME2/dirmod.asp?type=CRE&nm=CRE&mod=News&mid=A7B0FE85D23A4DB9B5581E6AACFFBE01&tier=3&id=72B7F60568374FE590585130DBF22939">Four Gateway in Newark sold for $72 million</a> (CRE/IPG) to a partnership including Ivy Equities and Heritage Management. The 327,000 square foot office, purchased for $220 per square foot, is part of the Gateway complex near Newark's Penn Station, which includes a couple of other buildings which have traded in the last 2 years. The JV formed for the purchase follows another recent Newark transaction involving both companies, as Ivy paid Heritage $21 million for 570 Broad.<br /><br />In other news from areas that don't smell like methane...<br /><br /><a href="http://www.chicagotribune.com/business/chi-070403inland,0,5603751.story?coll=chi-business-hed">Inland takes Winston Hotels for $458 million</a> (Chicago Tribune)<br /><br /><a href="http://www.businessweek.com/ap/financialnews/D8O982FG0.htm">Carl Icahn loses his CFO at American Real Estate Partners</a> (BW), and<br /><br /><a href="http://1010wins.com/pages/336387.php?contentType=4&contentId=397278">East Harlem residents don't want a better neighborhood</a> (1010 AM)Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-67535121753316428912007-04-03T16:45:00.001-04:002007-04-03T16:55:35.618-04:00$625 PSF takes down Vacant Fifth Avenue Building<div xmlns="http://www.w3.org/1999/xhtml">According to Globe Street, <a target="_blank" href="http://www.globest.com/news/876_876/newyork/159438-1.html">L&L has paid $500 million for the 800,000 square foot Toy Center</a>, and plans at least $75 million of improvements to turn it into a Class A office.<br /><br /><b>The building is vacant</b>, except for restaurant <i>Cipriani</i>. Lehman provided the financing for the acquisition, and presumably, the renovations going forward. Tenants will be able to take occupancy by the end of next year.<i><br /><br /></i><blockquote><i>“We believe that having the largest block of available class A space in New York City will attract the attention of a variety of large tenants in the market. We have already had some inquiries,” says Robert Lapidus, L president and CIO.</i><br /><br /></blockquote><br /></div>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-81876665475619740992007-04-02T20:01:00.000-04:002007-04-02T20:09:54.884-04:00Monday Notes: New Century Busts, Starwood CEO OutIn what was a huge surprise to no one, <a href="http://www.bloomberg.com/apps/news?pid=20601087&sid=a9e64Mkizp7I&refer=home" target="_blank">New Century filed for Chapter 11 this morning</a> (Bloomberg) as the subprime fallout continues. In the press release posted on DealMaker, the CEO made a plea that CIT and Greenwich would retain many of the Associates, even as New Century let a few thousand of them go, announced earlier in the day.<br /><br /><a href="http://www.bizjournals.com/atlanta/stories/2007/04/02/daily4.html" target="_blank">Steven Hayer announced his resignation from the CEO position at Starwood Hotels</a> (Atlanta Business Chronicle), after a rumored "tense" weekend meeting in which the board expressed its collective lack of confidence in his leadership of the company.<br /><br /><a href="http://www.globest.com/news/875_875/newyork/159415-1.html" target="_blank">Italian investment group Ifil closed on its acquisition of a majority 71.5% stake in Cushman & Wakefield</a> (GlobeSt.com) today. The $675 million deal values the company at around $875 million.<br /><br />And finally, <a href="http://threecap.blogspot.com/2007/04/my-300-am-conversation-with-58-capacity.html">either Quill has designed a new "SmartClip"</a>, or I was working too late again last night and self-medicating too much. (Though probably the latter).<br /><br /><br /><span style="font-weight: bold;">Edit, 8:15 PM:</span> Welcome to <a href="http://theallnighter.blogspot.com/" target="_blank">The All-Nighter</a> readers, and thanks to Monkey for the link -- 3CUnknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-974989168039924122007-04-02T18:42:00.000-04:002007-04-02T18:48:10.260-04:00My 3:00 AM Conversation with a 5/8" Capacity Quill Medium Binder Clip<a onblur="try {parent.deselectBloggerImageGracefully();} catch(e) {}" href="http://www.yourhome123.com/assets/images/content/eFAQs/images/Os07052.jpg"><img style="margin: 0pt 0pt 10px 10px; float: right; cursor: pointer; width: 135px; height: 139px;" src="http://www.yourhome123.com/assets/images/content/eFAQs/images/Os07052.jpg" alt="" border="0" /></a>Me: "Forty-one million NOI, five-and-a-quarter cap, is seven eighty-one..."<br /><br />Medium Binder Clip:<br /><br />Me: "Eight hundred with costs; eighty-five percent leverage is six-eighty at one-thirty over..."<br /><br />Medium Binder Clip:<br /><br />Me: "So debt service is... <i>Christ</i>, where's the ten-year again?"<br /><br />Medium Binder Clip: <a href="http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=tnx&sid=0&o_symb=tnx&x=0&y=0" target="_blank">"Four-point-six-four-two."</a><br /><br />Me:<br /><br />Medium Binder Clip:<br /><br />Me:<br /><br />Medium Binder Clip:<br /><br />Me: <i><a href="http://www.ibankingoasis.com/node/4807" target="_blank">"F*cking monkeys..."</a></i>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-85786263375063292022007-04-02T18:19:00.001-04:002007-04-02T18:19:31.632-04:00Trading Floor Envy at NY I-Banks<a href="http://www.bloomberg.com/apps/news?pid=20601087&sid=aGVyWweoDV.A&refer=home" target="_blank">A version of this story</a>, which was featured prominently in this morning's WSJ, gave way to emails upon emails from colleagues here and friends at other firms -- even those not mentioned in the article -- reminding me and everyone else it was sent to that the sender still works at a prominent i-bank. <br /><br />Forget trading floor envy, as the Journal put it; this was best characterized as logo-on-the-polo-shirt envy, or at best, trading floor speculation envy. <br /><br />These plans fall apart faster than they materialize. Remember in 2003, when Goldman was building a magnificent high rise for their new corporate HQ, the tallest building in the state, with all the bells and whistles you would expect from such a modern architectural and business services marvel -- in New Jersey. <br /><br />Four years later and they are still leasing that tower up. Meanwhile Goldman is building their new digs in Battery Park City.<br /><br />From a real estate perpective, if the hype surrounding all of these banks looking for huge amounts of contiguous space is true, it confirms the assumption that Manhattan occupancy rates and rental rates aren't coming down anytime soon, as these hungry banks search for high-profile space, aren't shy about shelling out the money for it, and continue to expand organically and via mergers and acquisitions. As cap rates continue to drop (somehow) to nearly half of the current 10-Year US Treasury yield, significant upside is still the horse that's drawing the carriage.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-3612993271849773125.post-18339018099836515312007-04-02T17:12:00.001-04:002007-04-02T17:12:38.601-04:00Bull$hit, Pt. II<div xmlns='http://www.w3.org/1999/xhtml'>Park Avenue in the 50's (aka., "Wall Street North") is known for <s>my bosses</s> the ostenatatious little $hits who occupy window offices looking south toward the Waldorf, feet on their desks, chit-chatting away on their 20-line standard-issue telephones while reviewing an email on a blackberry instead of looking at their 35-times larger flat-screen monitor only 28 inches from their nose.<br></br><br></br>Maybe the Avenue makes the man, because half of the bosses on the block are 50% talk, 40% dictator and 10% knowledgable about anything "real" whatsoever. It's becoming a delagating cluster-f*ck.<br></br><br></br><blockquote>MD: I sent you an email this morning outlining a new, innovative bond structure we need to analyze, include in the model we distributed earlier, update the overview with same, and get it out.<br></br><br></br><i>(Of course, the first hint that you're working with a real winner is when they verbally refer to what they just said as "same".)</i><br></br><br></br>MD: So round everyone up, and get it done, okay?<br></br><br></br>me: Of course. I've got Rob on the model, and Sean and I will be updating all the materials to reflect the changes well into the night.<br></br><br></br>MD: Good. Clear the decks and let's make sure it gets done tonight.</blockquote><br></br><br></br>Fair enough request, right? But it's the "we" and "us" parts that really pisses me off. These guys bring in the deal, don't do anything on the execution side besides create more work and <s>f*ck up</s> "tweak" what's already been done by the deal team. The delegation of meaningless tasks and demands of the tiniest changes ultimately result in hundreds, if not thousands of man hours spent making changes that will in no way re-shape the transaction or alter the deal's economics, forgetting the fact that the likelihood of the deal ever getting done in the first place is slim to none.<br></br><br></br>It's like we're all back in 7th grade [American] football, where Coach Fisher tells 4-foot-3, 80-pound Jimmy how to properly tackle the running back on the end-around play. Jimmy goes home and practices day and night for a week, even skips school to practice more, and regularly stays in his backyard until well past his bedtime. But at the end of the day, Jimmy is still 4-foot-3, 80 pounds, destined to jockey at Belmont Park.</div>Unknownnoreply@blogger.com0