Tuesday, February 24, 2009

HFF secures $35M refinancing for One Financial Plaza in Hartford, CT

HARTFORD, CT – The Hartford office of HFF (Holliday Fenoglio Fowler, L.P.) has secured a $35 million refinancing for One Financial Plaza, (centered photo below) a 621,305-square-foot Class A office building plus an adjoining eight-story, 1,100-space parking garage in Hartford, Connecticut.

HFF senior managing director Dana Brome (top right photo) and managing director Gerry Yates worked exclusively on behalf of the borrower, Talcott Realty Investors, LLC in arranging the three-year, adjustable-rate loan through People’s United Bank.

Talcott Realty Investors, an opportunistic real estate investment firm headquartered at One Financial Plaza, has a geographically diversified portfolio of approximately 3.6 million rentable square feet of Class A office buildings across the US.

One Financial Plaza, also known as “The Gold Building” is currently 99% leased to 28 tenants including United Technologies Corporation, Travelers, Conning, Reid & Riege and People’s Bank. The 26-story property is located at 755 Main Street in Hartford’s central business district directly west of Adriaen’s Landing.

“People’s United Bank’s involvement is a reflection of how local and regional banks area aggressively filling the capital void left behind by the lack of appetite from life insurance companies and CMBS providers,” said Yates.

HFF (NYSE: HF) operates out of 18 offices nationwide and is a leading provider of commercial real estate and capital markets services to the U.S. commercial real estate industry. HFF offers clients a fully integrated national capital markets platform including debt placement, investment sales, structured finance, private equity, loan sales and commercial loan servicing. http://www.hfflp.com/.


Dana E. Brome, Senior Managing Director, (860) 275-6199, dbrome@hfflp.com
Kristen M. Murphy, HFF Associate Director, Marketing, (713) 852-3500 krmurphy@hfflp.com

Home Purchase Incentives Win Support from Lobbyists and Builder

WASHINGTON, DC—New tax credit incentive plans enacted by President Barack Obama and California Gov. Arnold Schwarzenegger (bottom right photo) are winning expected support from lobbyists and home builders, despite some heated criticisms of the measures in other public and private quarters.

In California, the Legislature has approved a tax credit of up to $10,000 for the purchase of a newly constructed home.

Nationally, the Stimulus Bill passed by the Congress provides a credit of $8,000 or 10 percent of the home’s purchase price (whichever is less), to buyers who haven’t owned a home in the last three years, and who are within certain income limits.

In a letter to the Mortgage Insurance Companies of America, Federal Housing Finance Agency Director James B. Lockhart III (top right photo) emphasized “the vital role” the private mortgage insurance industry will play in President Obama’s housing recovery program.

“I would reiterate my belief in the importance of a vibrant, healthy private
mortgage insurance market for conventional mortgages,” Lockhart says.

“Mortgage insurers, as participants in the assessment and pricing of mortgage credit risk, play an important role in our housing finance system.

“While the extraordinary circumstances in housing finance have greatly stressed mortgage insurers, I remain hopeful that the industry successfully recapitalizes so that it may continue its important role.”

MICA President Kevin D. Schneider (middle left photo) praised Lockhart for sending the letter, outlining the specifics of the incentive program.

“We commend Director Lockhart for offering this important clarification of the President’s housing recovery program,” said Schneider.

“The purpose of the program is to help mitigate losses to American homeowners during this stressful period.

“We support these efforts because they will help families maintain their homes by easing the financial strain of mortgage obligations they may be unable to afford.”

Added MICA Executive Vice President Suzanne C. Hutchinson: “The private mortgage insurance industry is a vital component of the nation’s housing finance system,

“Mortgage insurers make homeownership more affordable by helping borrowers seeking a low down payment home loan. We will continue to work with Fannie Mae and Freddie Mac to mitigate losses in the mortgage market.”

“This bill provides a meaningful incentive to buyers looking to buy a home for the first time in their lives,” says Jeffrey T. Mezger, (top left photo) president and chief executive officer of Los Angeles-based KB Home, one of the largest home builders in the U.S.
“With lower prices, low interest rates and this new housing tax credit, there is a golden opportunity for first-time buyers to realize the American dream of home ownership.”

Mezger adds, “This fully refundable tax credit reduces a homebuyer’s tax bill or increases their refund dollar for dollar, which means it will be paid out even if a taxpayer owes no tax or if the credit is more than the tax they owe.

“To qualify, the home purchase must close before December 1, 2009, so buyers should act quickly.”

Of California’s $10,000 housing tax credit, Jerry M. Howard,(top right photo) president and CEO of the National Association of Home Builders, calls the legislation “an effective measure to help resuscitate the Golden State’s ailing economy.”

Howard adds, “We encourage other states to take similar action to bring about a housing and economic recovery.”

JEMB Realty Launches Basis Investment Group LLC to Capitalize on Unprecedented Opportunities in Debt Market

NEW YORK, NY--(BUSINESS WIRE)--JEMB Realty, an experienced real estate owner, developer and management company, has launched Basis Investment Group LLC, to capitalize on the unprecedented opportunities in the debt market.

Finance veteran Tammy K. Heyman, who previously directed CWCapital’s fixed and floating rate Capital Markets Lending Division, will serve as President of the new venture. Morris Bailey and Joseph Jerome, (top right photo) founding principals of JEMB Realty, made the announcement.

Basis Investment Group, as the latest venture in the JEMB family of Companies reflects JEMB’s ability and agility to identify opportunities in a changing marketplace.

Basis Investment Group is a debt investment platform that acquires and originates high-yield performing and distressed whole loans, mezzanine loans, B notes, gap equity and select CMBS investments on behalf of its clients.
In addition to debt investment, Basis Investment Group will provide origination, lending and underwriting support to third parties on a separate account basis.

“Our track record and formidable resources, combined with the proven leadership of Tammy Heyman make Basis Investment Group an immediate impact player in this market, where investor confidence is low and capital is scarce,” said Bailey.

Heyman and the Basis Investment Group management team have originated and securitized in excess of $30 billion of fixed, floating rate and mezzanine debt products over the last decade, while JEMB Realty operates more than 7.2 million square feet of real estate in North America and has deep entrepreneurial roots extending over 30 years.

In her role as president, Heyman will build the debt investment platform, raise and deploy capital, as well as develop, manage and oversee the company’s operations.

She brings more than 20 years of experience in the commercial real estate finance industry, a solid record of building and growing debt platforms and a well developed strategic view of this business.
“We needed someone who had the experience of running a business, the understanding of today’s challenging investment climate and the ability to see and create opportunities where others could not,” said Jerome, president of JEMB Realty.

“This is an ideal time to extend the reach of JEMB to launch a debt investment arm,” said Heyman. “Achieving ‘equity like’ returns, while only taking debt level risk is a great value proposition for us.

" While the opportunities are vast, our focus will be on identifying those investments at the right ‘basis’ that will generate solid returns and preserve our clients’ capital.”
JEMB Realty Corp. is an experienced real estate owner, developer and manager headquartered in Manhattan that acquires, upgrades and repositions commercial, retail and residential property in existing and emerging city business districts.

With its subsidiary BUSAC Real Estate in Montreal, Quebec, JEMB owns and operates in excess of 7.2 million square feet of commercial space in North America.

Contacts: Great Ink Communications, Roxanne Donovan or Barbara Nelson, 212-741-2977.

Nationally, Home Price Declines Closed Out 2008 with Record Lows According to the S&P/Case-Shiller Home Prices Indices

Data through December 2008 shows:

---Prices of existing single family homes across the United States continue to set record declines.

---The decline in the S&P/Case-Shiller U.S. National Home Price Index, which covers all nine U.S. census divisions, recorded an 18.2% decline in the 4th quarter of 2008 versus the 4th quarter of 2007, the largest in the series' 21-year history.

---The 10-City and 20-City Composites also set new records, with annual declines of 19.2% and 18.5%, respectively.

---From the peak in the second quarter of 2006, average home prices are down 26.7% in the United States.

NEW YORK, NY, Feb. 24, 2009 – Data through December 2008, released today by Standard & Poor’s for its S&P/Case-Shiller Home Price Indices, the leading measure of U.S. home prices, show that the prices of existing single family homes across the United States continue to set record declines, a trend that prevailed throughout all of 2007 and 2008.

The chart above depicts the annual returns of the U.S. National Home Price, the 10-City Composite and the 20-City Composite Indices. The decline in the S&P/Case-Shiller U.S. National Home Price Index – which covers all nine U.S. census divisions – recorded an 18.2% decline in the 4th quarter of 2008 versus the 4th quarter of 2007, the largest in the series’ 21-year history.
The 10-City and 20-City Composites also set new records, with annual declines of 19.2% and 18.5%, respectively.

"The broad downturn in the residential real estate market continues," says David M. Blitzer, (top right photo) Chairman of the Index committee at Standard & Poor’s.

"There are very few, if any, pockets of turnaround that one can see in the data. Most of the nation appears to remain on a downward path, with all of the 20 metro areas reporting annual declines, and eight of those MSA’s now with negative rates exceeding 20%.

"If one looks in detail at the annual return data, it can be seen that 13 of the 20 MSA’s and the two composites have been reporting consecutive record declines since December 2007.

"The monthly data follows a similar trend, with all of the metro areas reporting at least four consecutive months of negative returns."

The chart above shows the index levels for the U.S. National Home Price, as well as its annual returns. As of December 2008, average home prices across the United States are at similar levels to what they were in the third quarter of 2003. From the peak in the second quarter of 2006, average home prices are down 26.7%.

All 20 metro areas are reporting negative monthly and annual rates of change in average home prices.

Boston, Denver, Los Angeles, San Diego and Washington D.C. are reporting a relative improvement in year-over-year returns, in terms of lesser rates of decline than last month’s values.

Detroit showed a marginal improvement in monthly returns, but was worse off in its annual rate. Minneapolis, Las Vegas and Phoenix all reported monthly declines in excess of 4.5% in December.

The seven worst performing cities in terms of year-over-year declines continue to be from the Sunbelt, reporting negative returns in excess of 20%.

Phoenix was down 34.0%, Las Vegas reported -33.0% and San Francisco fell 31.2%. Denver, Dallas, Cleveland and Boston faired the best in terms of annual declines down 4.0%, 4.3%, 6.1% and 7.0%, respectively.

Looking at the data from peak-thru-December 2008, Dallas is down a relatively mild 8.6% from its peak in June 2007, while Phoenix is down 45.5% from its peak in June of 2006.

The rates of decline from the individual heights of each market are evidence of how much each market has taken back in terms of the gains earned in the past 10-15 years.

Eighteen of the 20 metro areas are in double digit declines from their peaks, with half of the MSA’s posting declines of greater than 20% and four of those (Las Vegas, Miami, Phoenix and San Francisco) in excess of 40%.

The table below summarizes the results for December 2008. The S&P/Case-Shiller Home Price Indices are revised for the 24 prior months, based on the receipt of additional source data. More than 21 years of history for these data series is available, and can be accessed in full by going to http://www.homeprice.standardandpoors.com/