Wednesday, July 4, 2018

Real Estate Capital Institute Finds Benchmark Five and 10-Year Treasuries Hold Steady

John Oharenko

Chicago, IL -- Even as the Fed increased rates by a
quarter point last month, benchmark five and ten-year treasuries held
steady. Experts have been predicting narrowing spreads and rising indices
for quite some time. For short-term, floating rate debt, such logic holds
true, but long-term rate behavior has baffled even the most astute pundits.
Investors continue seeking treasuries as financial protection against global
turbulence keeping long-term debt borrowing costs low.

Patience is paying off for borrowers waiting to lock into favorable fixed
rates, even in the face of more rate-hike threats. Mortgage pricing barely
changed as compared to the previous month. Spreads narrowed by about five
basis points from last month. Longer-term rates for conservatively
underwritten loans now hover in the lower four-percent-range; very low
leveraged debt may dip below four percent.

Given investor demand for purchasing mortgage debt, the best pricing
opportunities favor larger deals (e.g., $30 million plus). Lenders offer
more efficient underwriting and effective loan syndications for larger
deals. Interim loan programs, mainly bridge debt, is readily available from
banks and mortgage funds, as lenders seek competitive yields by climbing up
the risk curve. Furthermore, interest-only, non-amortizing debt remains
abundant. All in all, numerous capital sources will aggressively compete for
any reasonably viable real estate venture.

Since debt is very favorably priced, equity investing remains extremely
challenging, with no relief in sight. Yields are squeezed for nearly all
asset types and classes. Even so, many buyers starve for core product based
on the belief that core-plus and value-add investment returns are
comparatively low given the additional risk. On the other end of the
spectrum, opportunity ventures -- particularly new construction -- still
draw investor attention, but escalating construction costs squeeze yields to
paltry levels. Finding favorable returns continues to be the most
challenging responsibility of any investment manager.

The Real Estate Capital Institute's(r) director, John Oharenko, notes,
"Bargains are few and far between. Realty investing has risen to new
heights as a desirable investment class, both institutionally and with
private capital."

For more information, please contact:

 John Oharenko,
Executive Director
The Real Estate Capital Institute(r)

29th Street Capital Acquires Twin Trees Apartments; Community is Firm’s First Salt Lake City-Area Acquisition

Twin Trees Apartments, Layton, Utah
Layton, Utah  – 29th Street Capital (29SC), a privately-held real estate investment and advisory firm, has acquired Twin Trees Apartments, a 43-unit multifamily community in Layton, Utah. 
29SC plans to invest approximately $10,000 per unit in capital improvements, including upgraded countertops, cabinets, floors, appliances, lighting and fixtures. Exterior projects will include better landscaping, new heating and air conditioning units and curb appeal enhancements. 
The property is situated about 20 miles north of downtown Salt Lake and is alongside I-15.
McKay Winkel

 “Twin Trees is an exciting first deal to establish 29th Street Capital’s presence in the Salt Lake area,” said McKay Winkel, Vice President of Acquisitions for Salt Lake City. “The submarket has tremendous population growth in addition to several other attractive metrics.”
 Salt Lake City has recently earned excellent rankings in a number of areas.

Wallethub ranked it #1 for the most job opportunities; The Urban Land Institute placed it as the #2 best location in the U.S. to buy multifamily real estate; Forbes calls it the #3 American city where employees are happiest.
  “The Layton submarket is poised for continued growth and improvement as the forward momentum of downtown Salt Lake City flows outward,” Winkel added. “We will execute 29SC’s business plan and offer the Layton submarket a higher-quality housing alternative.” 
 The transaction closed June 29. The sale price was not disclosed.
 For investment inquiries, contact:
Stan Beraznik, Founder and Managing Principal at 29th Street Capital
For more information, please contact:

Terri Thornton

Partner, Thornton Communications

JLL completes sale of Ryan Companies' medical office project in Phoenix, AZ to Inland Real Estate Acquisitions LLC

Banner Health Center, Phoenix, AZ

Tivon Moffitt
PHOENIX, AZ – Strong investor demand for well-occupied medical office space has spurred the sale of a state-of-the-art, build-to-suit facility in Phoenix that is fully leased to Banner Health. 

The sale was completed by the Phoenix office of JLL for Minneapolis-based Ryan Companies to Inland Real Estate Acquisitions LLC, on behalf of Inland-related parties.

“This sale underscores a strong and steady demand for medical net lease assets in Phoenix and across the nation, particularly when buildings are leased to industry leading tenants such as Banner Health,” said JLL Senior Vice President Tivon Moffitt.

 Moffitt represented Ryan Companies in the sale along with JLL Senior Managing Director Dennis Desmond and Senior Vice President Peter Bauman. “The fact that the building was constructed by a market leader like Ryan Companies only adds to its value.”

Dennis Desmond
Located at 4375 E. Irma Ln. in Phoenix, the Banner Health building totals 29,350 square feet of Class A medical office space built in 2018.

It is situated near the corner of Tatum Boulevard and the Loop 101, with direct visibility from the Loop 101 freeway and close proximity to State Route 51 and Interstate 17.

 It also sits in the desirable Desert Ridge community, featuring high-end residential neighborhoods and a mix of premier office, retail, restaurant and entertainment developments.

The medical office building provides primary and specialized care services.

“Banner Health was a tremendous addition to the Desert Ridge Community,” said John Strittmatter, Chairman, Southwest for Ryan Companies. “We were pleased to work with JLL and Inland Real Estate Acquisitions LLC on the sale of the property.”

Peter Bauman
According to JLL, the greater Phoenix medical office market decreased in the second quarter to a post-recession vacancy low of 13.6 percent.

“Our team has sold properties to Inland Real Estate Acquisitions LLC in markets across the country,” said Bauman. “We are pleased to help them continue to expand their medical office portfolio holdings at a time when demand and stability are so high.”

JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management.

 Our vision is to reimagine the world of real estate, creating rewarding opportunities and amazing spaces where people can achieve their ambitions. In doing so, we will build a better tomorrow for our clients, our people and our communities. 

JLL is a Fortune 500 company with nearly 300 corporate offices, operations in over 80 countries and a global workforce of 83,500 as of March 31, 2018. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated.

John Strittmatter
In Phoenix, JLL is a market leader employing more than 580 of the region’s most recognized industry experts offering office, industrial, retail, healthcare and data center brokerage, tenant representation, facility and investment management, capital markets, multifamily investments and development services, and related services within the real estate leasing, investment and management process. 

In 2017, the Phoenix team completed 35.7 million square feet in lease and sale transactions valued at $1.9 billion, directed $112 million in project management and currently manages a 24.2 million-square-foot portfolio. 

For more information, please contact:

Stacey Hershauer
Phone: +1 480 600 0195

HFF announces $16 million sale of retail parcel in Chicago’s Central Loop

11 South LaSalle Street, Part of Historic Roanoke Tower,
 Financial District, Chicago, IL

CHICAGO, IL –– Holliday Fenoglio Fowler, L.P. (HFF) announces the $16 million sale of a 13,062-square-foot urban retail parcel that is part of the historic Roanoke Tower at 11 South LaSalle Street in the heart of Chicago’s financial district.
Amy Sands

The HFF team marketed the property on behalf of an affiliate of The Prime Group, Inc., a Chicago-based real estate development firm.

Originally constructed in 1915 and renovated in 2015, the 91-percent-occupied retail space is home to Citibank, Roanoke Restaurant, 7-Eleven and T-Mobile. 

The retail parcel is situated below the award-winning, 381-room Residence Inn Chicago Downtown/Loop hotel, the largest Residence Inn hotel in the world, which opened in September 2015 to much acclaim. 

Clinton Mitchell

11 South LaSalle is located at one of the most highly trafficked intersection in downtown Chicago, which sees an average of 28,500 pedestrians, 26,500 vehicles and 23,185 CTA bus passengers each day. 

The property’s dominant location in the Central Loop places it at the epicenter of a rapidly growing 24-hour live-work-play environment with mixed-use office, hotel and retail developments; high-end restaurants and food halls; thousands of multi-family residences and a densely populated daytime wor
kforce population of 540,000.

The HFF investment advisory team representing the seller included senior directors Amy Sands and Clinton Mitchell.

For more information, please contact:

HFF Digital Content/Public Relations Specialist
(713) 852-3420

Champion Real Estate Co. Sells Grand & Alosta, a Newly Redeveloped Grocery-Anchored Retail Center in Los Angeles, CA Area

Grand & Alosta Retail Center, 655 South Grand Avenue,
Glendora, CA

LOS ANGELES, CA — Champion Real Estate Company (“Champion”), announced it has sold Grand & Alosta, a newly redeveloped 70,811-square-foot grocery anchored retail center located in Glendora, California to 655 South Grand Avenue Owner, LLC. 

Shauna Mattis
Champion Glendora, an affiliate of Champion, acquired the vacant 85,615-square-foot building in 2016.  The firm redeveloped it into a smaller 70,811-square-foot multi-tenant neighborhood shopping center,  co-anchored by Sprouts and Marshalls and 100 percent leased to several local retailers, restaurants and services. 

Blake Kaplan
 JLL's team of Shauna Mattis, Blake Kaplan and Scott Burns handled leasing at the property.

“This was the perfect example of Champion implementing its value-add business strategy by acquiring an underperforming asset, redeveloping it into a stable property and selling it to a qualified owner/operator," said Chris Wilson, Executive Vice President and Retail Partner with Champion Real Estate Company.  "Champion will look to acquire a multifamily property with the proceeds."

The HFF team of Bryan Ley, Gleb Lvovich and Justin Kundrak represented the seller.  The buyer represented itself.

Scott Burns
Grand & Alosta is located at the highly desirable intersection of Grand Avenue and Alosta Avenue (Historic Route 66), less than one mile from the 210 freeway and  walking distance to Azusa Pacific University and Citrus College. 

Champion Real Estate Company (“Champion”) was founded in 1987 by veteran investor, developer and CEO, Bob Champion. Based in West Los Angeles, Champion’s strategy is to acquire infill properties in “A” locations within markets that are core, core adjacent or gentrifying to core and implement value accretive improvements.  

For more information, please contact:

David Ebeling
Ebeling Communications


Kimberly Steele
Digital Content/Public Relations Specialist
T: 713-852-3420