RECI Reports Borrowers Keep Winning as Treasuries Move Downward

  

Jeanne Peck

Chicago,IL, May 1, 2017 - The Real Estate Capital Institute reports overseas "shock" events in North Korea,

Turkey and Syria spread market jitters, as investors flock to the safety of

US government treasuries.  Even with the Fed's policy to control inflation

with interest rate hikes, longer-term treasuries stubbornly move downward to

levels not seen since last fall. 

Borrower keep winning under such circumstances, capturing permanent

fixed-rate debt within the higher-three-percent range to the

lower-four-percent range for most types of conventional loans.  However,

shorter term rates also start with a three-percent handle, since floating

rate indices move in tandem with Fed benchmark rates.  More specifically,

even as treasury notes dropped about a quarter point since the beginning of

the year, 30-day Libor rates rose by about the same amount. A flattening

yield curve is the result - long rates are the "sweet spot" in the realty

capital stack.

The markets are flooded with capital and no shortage of real estate debt

exists.  Yet lenders are more cautious given the current point in the

economic cycle, and more equity is typically required to attract decent

financing terms. The longer-term lending market based upon the lowest rates

is dominated by life companies. Agencies comfortably capture multifamily

loans, often providing attractive pricing/leverage combinations and programs

to foster value add and affordable housing.  Conduits focus on larger

single-asset securitizations and higher-yielding loans that are not good

fits for LifeCos/agencies.  Debt funds provide higher leverage and more

structured fundings, especially bridge loans for asset repositioning

situations.  Banks fund new construction loans, but at more conservative

levels than in the past few years.

As for product type, investors continue clamor for multifamily assets this

year, with private funds overwhelmingly dominating the market, representing

nearly two-thirds of the market share by some estimates.  Foreign investors

are in on the party as well, especially in gateway markets.  All in all,

while interest rates have climbed since the election, the impact on pricing

has been minimal for institutional-quality properties.

The Real Estate Capital Institute's director, Jeanne Peck, advises, "Global

issues help flatten the yield curve.  International demand for safe-haven

long treasuries have kept yields stubbornly low... a real benefit for

permanent fixed-rate borrowers."

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

The   Real Estate Capital Institute(r)

3517 West Arthington Street

Chicago, Illinois USA 60624

Jeanne Peck, Executive Director

American Realty Advisors Acquires 850,000-SF Class A Distribution Building in Atlanta, GA Submarket

King Mill Distribution Center, McDonough, GA

David Hubbs

McDonough, GA (May 1, 2017) – American Realty Advisors (“ARA”), an institutional capital management firm with over $8 billion in assets under management, has acquired King Mill Distribution Center, a 846,496 square-foot Class A cross-docked distribution facility in the Atlanta submarket of McDonough, Georgia.

            The building is 100-percent leased to CastleGate Logistics with a guaranty from its parent company, Wayfair.com, one of the world’s leading online destinations for home goods. Wayfair.com’s revenue surpassed $3.38 billion in 2016.

            “ARA invests in high-quality core assets with durable and accretive income returns located in dynamic submarkets across the country,” says David Hubbs, Senior Portfolio Manager at ARA.  

“This acquisition is a prime example of how we execute that strategy. King Mill Distribution Center is situated in a submarket widely known for its institutional quality assets and top-tier tenants and is fully leased to a global company with rapidly growing market share.”

            Hubbs also points to the strong local market as a key factor in ARA’s acquisition decision.

            “King Mill Distribution Center is located within 2 miles from I-75, which is the primary route from Atlanta to Florida and a direct connection to the Port of Savannah, the nations’ fourth-largest and fastest-growing U.S. container port,” says David Willett, Senior Director, Investment Group at ARA.  “The Atlanta metro is a major logistics hub, an economic engine of the Southeast, and home to one the nation’s leading business centers.”

 

David Willett

            The region continues to attract a diverse range of industries including corporate and regional headquarters for many Fortune 1000 firms and 15 Fortune 500 companies are headquartered within the Atlanta metro, ranking just behind Houston and New York City.

            Willett adds, “We were attracted to King Mill Distribution Center based on the region’s rapid growth, a healthy diversification of local industries, and the asset’s accretive in-place cash flow. We believe that the property is well-positioned to deliver long-term value to our tenant and to our investors.”

Built in 2016, the bulk distribution facility features state-of-the-art building specifications including cross-dock configuration, 185 foot deep full concrete truck courts, ESFR sprinklers, ductilcrete flooring systems, 36 foot minimum clear height, 171 dock high loading doors, four drive-in doors, abundant employee parking, and 237 trailer storage positions.

“The high quality construction and top-of-the-line material selections should result in the property maintaining its competitive advantage in the marketplace. Along with lower maintenance costs, this should drive attractive long-term returns for our investors,” continues Willett.

Frank Fallon

Hubbs adds, “Our investment in King Mill Distribution Center is consistent with ARA’s risk-adjusted core investing strategy to add in-place income growth to the portfolio with future appreciation upside potential in top-tier markets that are positioned to withstand any potential future economic shifts.”

King Mill Distribution Center is located at 130 Distribution Drive in McDonough, Georgia. Frank Fallon, Chris Riley and John Farell at CBRE represented the seller, King Mill Distribution Park, LLC, a Trammell Crow Atlanta development. 

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

Lexi Astfalk / Jenn Quader for American Realty Advisors

Brower, Miller & Cole

(949) 955-7940, LAstfalk@browermillercole.com

Aurora Sunny Isles Beach Grows Sales Team with Addition of Joyce Larkin

  

Joyce Larkin

SUNNY ISLES BEACH, FL – Aurora Sunny Isles Beach has announced the hiring of Joyce Larkin as a sales executive with its growing team.

The addition comes at a time when Aurora developer Verzasca Group is receiving tremendous demand at the Sunny Isles Beach project, which is being developed as part of an intimate collection of boutique residences, along with Le Jardin Residences and Pearl House in Bay Harbor Islands.

John Warsing

With over 15 years of experience in real estate sales and marketing, selling luxury South Florida projects comes naturally to Larkin. Led by Director of Sales John Warsing, the addition of Larkin amplifies the wealth of real estate experience at Aurora’s sales team.

After moving to South Florida in 1996, Larkin quickly learned the ins and outs of the real estate industry. She quickly acquired her real estate license and then her mortgage broker’s license, and took the area by storm, becoming a top producer at her firm.

“Joyce is a tremendous addition to our sales team,” said Verzasca Managing Director Tim Lobanov. “We continue to see strong interest for our project from local and international buyers. The marketplace is realizing that Aurora offers a rare convergence of luxury, value and location.”

Aurora is a new luxury condominium project with 61 residences at 17550 Collins Avenue in Sunny Isles, one of the world’s most sought-after destinations. The boutique building’s two and three-bedroom residences range from 1,385 to more than 2,150 square feet. Prices start in the $900,000s, making it the most attainable luxury project on Sunny Isles.

Le Jardin and Pearl House are new boutique residences situated in Bay Harbor Islands.

Tim Lobanov

A 30-residence community at 1150 and 1160 102nd Street, Le Jardin has two and three-bedroom units ranging from 1,385 to 2,235 square feet. Pearl House is an exclusive 15-resident community at 11701 101st Street and offers two-, three- and four-bedroom apartments. 

The projects feature amenities such as a private garden, rooftop swimming pool and panoramic views of the Atlantic Ocean, Downtown Miami, Bal Harbour, Miami Beach and Key Biscayne.

Both Le Jardin and Pearl House are located in Miami-Dade County’s top school district, with Ruth K. Broad K-8 Center within walking distance. 

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

BoardroomPR

Eric Kalis: ekalis@boardroompr.com, 954-370-8999

Jasmin Curtiss: jcurtiss@boardroompr.com, 954-370-8999

www.aurorasunnyislesbeach.com.

www.verzasca-group.com.