Saturday, April 2, 2016

Lincoln Property Company Completes Record Breaking 2015

David Krumwiede
PHOENIX, AZ – Final year-end data has confirmed a record-breaking year for the Phoenix office of Lincoln Property Company (LPC), who in 2015 generated more than $233 million in investment and development activity, and substantially advanced its local property management portfolio and development pipeline.

The momentum has continued into 2016 as well. Since the first of the year, LPC has already closed on $69.59 million in new building investments (Gainey Center II in Scottsdale and Riverview Point in Mesa). 

It has also officially broken ground on the first phase of a planned 1.8 million square feet of new office space at The Grand at Papago Park Center, and on Waypoint Two, its final building at the Mesa, Arizona Waypoint office campus.

“Our team’s history in Phoenix runs deep and wide,” said Lincoln Property Company’s Executive Vice President David Krumwiede. “Every project we’re involved with has its own unique value that moves the commercial real estate market forward in a positive and strategic way, and reflects our commitment to the communities that we serve.”

“We take a very personal approach to property management assignments as well, creating tailored plans that bring assets to new levels of success,” said Lincoln Property Company’s Director of Management Services Alisa Timm. “Our growth is a result of these individual stories and the trust that clients place in Lincoln. We are grateful for both.”

Highlights of LPC’s record 2015 include:

 •       Biltmore Commerce Center, a 259,000-square-foot, Class A office building located on the Camelback Corridor – purchased in April for $58 million by LPC and Oaktree Capital Management.

•       Promenade Corporate Center, a 256,175-square-foot, two building office campus in the North Scottsdale/Kierland market – purchased in March for $65 million by LPC and Goldman Sachs.

•        Luhrs City Center, two historic Downtown Phoenix towers with 140,500 square feet of creative office space, 18,500 square feet of ground-floor retail and a 6-story parking garage – purchased in December for $44 million by LPC and Invesco Ltd.

•        Camelback Square, a 174,917-square-foot, Class A office building purchased by LPC and Oaktree Capital Management in 2011 and sold by the partnership in February 2015 for $42.3 million, after an aggressive lease-up and management program.

Alissa  Timm
•        Waypoint One, a $24 million, 108,000-square-foot modern office project developed and delivered by LPC and Harvard Investments in November. Waypoint One is adjacent to the 1.3 million-square-foot, mixed-use Mesa Riverview and is fully pre-leased to American Traffic Solutions.

•        Approximately one million square feet of new property management assignments, including El Dorado Tech Center, Biltmore Commerce Center, Promenade Corporate Center and Luhrs City Center. During 2015, LPC also retained multiple properties through ownership transitions. This brings the company’s Phoenix property management portfolio to more than 8 million square feet.

•        The Grand at Papago Park Center, a 60-acre, urban mixed-use project on the last developable site within Papago Park Center. In March, LPC was was selected to develop the first phase of a planned 1.8 million square feet of Class A mixed-use office space.

To discuss investment opportunities or leasing at LPC’s Phoenix projects, contact David Krumwiede at (602) 912-8888. For property management services, call Alisa Timm at (602) 912-8864.

For more information, visit or

For a complete copy of the company’s news release, please contact:

Stacey Hershauer
Marketing & Public Relations
(480) 600-0195

First Quarter Sales Commercial Real Estate Sales Fell Below 2015 Record Levels, Reports Real Estate Capital Institute

Jeanne Peck
Chicago, IL -- The Fed's decision to maintain rates
during the mid-March meeting illustrates that global economic issues
outpaced any fears of domestic inflation, as mortgage markets and bond
investors are adding yield premiums in anticipation of further hikes later
in the year.

 During the month benchmark five and ten-year treasuries
modestly dropped by just over ten basis points.

Early signs of "price discovery" influence investor behavior and
expectations as first quarter sales activity for commercial real estate fell
well below 2015 records levels.  Investors are taking a breather from
bidding wars as debt availability tightens due to conduit pricing
volatility.  Meanwhile banks adjust loan exposures slightly downward
pressured by new regulations initiated this year.  Yet investor demand for
high-quality assets continues unabated by foreign investors seeking safe
haven, even as domestic investors retreat.

As spring begins, the conduit markets are showing some signs of improvement
with Triple-A traches of debt selectively trade over 30 basis points lower
than earlier this year.  Mortgage bond investors prefer the improved
collateral offered in the most recent issuances, as conduit lenders become
more selective with choosing loan opportunities.  Also, fewer loan pools
have hit the markets in recent months, creating limited supply of offerings.
Other noteworthy trends within the debt markets include:

*    Despite a Treasury rally with declining rates, lenders are
establishing benchmark floor rates for various types of properties. (e.g.,
3.75% to 4%).
*    As CMBS players thread cautiously and widen spreads, agencies, banks
and life insurance companies are experiencing backlogs with loan requests;
the trend is shifting towards a "lenders market" versus "borrowers market."
*    Mortgage rates at very favorable levels especially for lower
leverage debt, despite tightening underwriting requirements.
*    Current banking and conduit regulations along with changes in public
market that pricing further constrained mortgage capital formation. Expect
more nonregulated private capital sources to fill the void, but at pricing
premiums, generally 5% or higher for longer term fixed-rate debt.

*    Pricing volatility for CMBS debt creates widening of at least 75 to
200 basis points or higher than similar bank and life insurance company
debt. Full transparency is the hallmark for working with conduit loans for
helping to manage pricing expectations in the midst of uncertainty.

The Real Estate Capital Institute's(r) director, Jeanne Peck, claims "Spring
brings more clarity to the capital markets, as both debt and equity
investors tread carefully." 

She adds, "Tertiary markets and more challenging properties will witness wider pricing, a healthy phenomenon, as the markets return to more 'rational' underwriting levels."

For daily rate updates, please call the Real Estate Capital RateLine at
7RE-CAPITAL (773-227-4825)

For a complete copy of the company’s news release, please contact:

Jeanne Peck, Executive Director,


Newly Formed RAF Pacifica Group Acquires 277,040 square-foot Industrial Portfolio in San Diego County, CA

Adam Robinson

 SAN DIEGO, CA – Newly formed RAF Pacifica Group has acquired a 277,040 square-foot portfolio consisting of 16 individual buildings throughout six multi-tenant industrial business parks in San Diego County. 

The acquisition price was not disclosed.  The firm secured a $19.6 million loan at 50 percent leverage for the acquisition.  All buildings are 100 percent occupied.

“This portfolio is a rare find in the market,” explains Adam Robinson, Principal of RAF Pacifica Group. “The current market for quality industrial products is extremely competitive in the San Diego area. RAF Pacifica Group, however, was able to secure six quality, tenant-diversified, full-occupancy multi-tenant business parks in San Diego County.

“This first acquisition is a testament to our firm’s strong relationships with local brokers, as well as our expertise in this market, both of which are essential to acquiring this product type.”

The Portfolio

            The acquisition consists of six fully-occupied projects with a total of 87 tenants.  The six projects included in the portfolio are Carroll Way Industrial Park, Rancho Pacifica Business Center, Sorrento Mesa Commerce Center, Enterprise Business Center, Oceanside Business Park I and Oceanside Business Park II.

CJ Stos
            RAF Pacifica Group purchased four of the six projects from a private international real estate investment firm, and the remaining two projects – Oceanside Business Parks I & II – from a private owner.  CJ Stos of Stos Partners is a partner with RAF Pacifica Group in the transaction.

Based on each project’s multi-tenant structure, excellent location and range of unit sizes, RAF Pacifica Group views the portfolio as a cash-flow, low-risk asset and anticipates long-term ownership of these properties. 

In addition, RAF Pacifica Group plans to draw upon its expertise in asset renovation and repositioning in order to implement exterior and interior enhancements that will enable the firm to increase current tenant rents to market rate, according to Robinson.

            “Maintaining high occupancy was the primary objective of the prior owners,” explains Robinson. “RAF Pacifica Group views its long-term hold assets with a long-term vision, however, and sees a strategic opportunity in this portfolio to create value upon tenant roll over. 

"We want to ensure that our assets are well-positioned for the future, and we plan to make as-needed improvements that will drive high yields.”

Lori Wendel
            Robinson notes that this portfolio is the perfect first investment for RAF Pacifica Group, providing the firm with the opportunity to implement and grow its business strategy, which focuses on acquiring, renovating and growing a pipeline of industrial, flex and office assets, as well as developing new product in Southern California.

Brokers involved in facilitating this portfolio transaction for RAF Pacifica Group include:

·         Randy LaChance, SIOR, a Senior Vice President with Voit Real Estate Services
·         Bob Willingham, SIOR, a Senior Vice President and Partner with Kidder Matthews
·         John Witherall, an Associate Vice President with Colliers International
·         Josh McFadyen, a Senior Vice President with Colliers International
·         Joe Crotty, a Senior Vice President with Colliers International

 James Ruiz and Lori Wendel with Keystone Mortgage Corporation provided acquisition financing to RAF Pacifica Group.

For a complete copy of the company’s news release, please contact:

Jenn Quader
Brower, Miller & Cole
(949) 955-7940

JLL Reports 80 Percent of 2.2 Million SF of New Office Space Construction Already Pre-Leased

Karsten Peterson
PHOENIX, AZ – JLL reports new commercial construction is still going strong in Greater Phoenix, AZ markets.

• More than 2.2 million square feet of office space (including 439,530 square feet of speculative space) is currently under construction in Greater Phoenix. An impressive 80 percent of that space is pre-leased.

• Almost 82 percent of space under construction (1.8 million square feet) is represented in three projects: Marina Heights, Arizona Department of Economic Security (build-to-suit in Chandler) and Skysong 4.

Expansion and absorption continue:

• A healthy 423,748 square feet of office space was absorbed in Phoenix during Q1, a 48.5 percent increase from one year prior.

• Overall vacancy is expected to decline in 2016 as office-using employers continue to expand and relocate to the Valley.

But the dynamics of spec development may be shifting:

• Speculative office development is declining as developers assess the market, taking note of how long the over 1.0 million square feet of vacant space delivered in 2015 stays on the market before kicking off new projects.

Here’s what JLL Managing Director Karsten Peterson says about Q1 office market trends from the landlord’s perspective:

“This recovery has seen a greater percentage of build-to-suits than previous Phoenix market rebounds. 

"We are hearing loud and clear that Corporate America wants buildings that meet the needs of today’s tenants – larger floorplate buildings with higher parking ratios and finished with a creative interior improvements including open ceiling environments, indoor/outdoor connectivity and walkable amenities.

“Expansions, consolidations and relocations still support the speculative office development pipeline, but that side of the market may begin to slow as capital becomes harder to secure.”

For a complete copy of the company’s news release, please contact:

Stacey Hershauer
Marketing & Public Relations
(480) 600-0195