Commercial Real Estate: A Rose Among Thorns? John B. Levy & Company Finds Few Positives Budding in Today's Commercial Real Estate Market

RICHMOND, VA, April 20, 2009 (PRWEB)--"Every Thorn Has Its Rose" is the latest in a series of timely, informative podcasts produced by John B. Levy & Company, and it provides clients and analysts with a sobering vision of what they can expect in today's commercial real estate market.

This new podcast is available online at http://www.jblevyco.com/.

Conditions that scorched the commercial real estate market in fourth quarter 2008 showed no signs of abating in January and February of 2009, dashing hopes among developers and investors alike that there might be an uptick in sales and refinancing activity in the new year.

Market watchers in the crowd longing for the days of 2007 discovered the disappointment of looking at the world through rose-colored glasses.

"Any hint of rosy optimism has been overrun with thorns," says John Levy, (top right photo) founder of John B. Levy & Company.

(John B. Levy & Co.-owned building at 4221 Forbes Blvd., Lanham, MD, top left photo)

"Most real estate owners, developers, and investors are beginning to realize that commercial real estate isn't going to recover in 2009, and probably not in 2010."

He adds, "we're looking toward 2011."

(John B. Levy & Co.-owned Fairfax Building in Richmond, VA, middle right photo)

Levy offers a couple reasons for his assessment.

First, of the top100 largest markets in the United States, 90 are still showing job losses, indicating that the current recession is both deep and wide.

Jobs drive the demand for multifamily housing, and they create the need for retail and office space. In addition, commercial real estate is a lagging, not leading sector.

"When the subprime financial market was going over Niagara Falls backward in a canoe in 2007," Levy says, "those of us in the commercial sector were doing just fine.

That said, we shouldn't expect commercial real estate to lead us out of this recession."
While it's difficult to be optimistic about today's market, Levy says there is a rose among the thorns, but it is in the budding stage.

(John B. Levy & Co.-owned International Tower Building, Baltimore, MD, middle left photo)

First, the federal government is pushing massive liquidity into the commercial real estate market via TARP and TALF, and these programs are starting to show promise.

For example, spreads on commercial mortgage backed securities (CMBS) have tightened more than 500 basis points.

Levy also believes we might see the rebirth of CMBS securitization by the end of the year, and the prospect of rejoining securitization and commercial real estate is a huge step in the right direction.

"In the meantime," Levy says, "the biggest problem owners and developers face today is that their loans are maturing and they lack financing opportunities. Almost $300 billion in commercial real estate loans is coming due in 2009, and more than $200 billion comes from bank loans. This situation creates a major challenge."

Levy suggests that owners and developers hire experts to assemble a financial package and help with strategy and negotiations.

He also recommends that those with properties suffering from negative cash flow avoid using personal cash to keep the note current.

Instead, that cash can be used as a principal payment or as additional collateral for negotiations and loan extensions.

(John B. Levy & Co.-owned Washington Center, Washington, D.C., middle right photo)

Finally, Levy suggests, those with a CMBS loan should ask in writing - not over the phone - for their loan to be transferred from the master servicer to the special service.

This strategy is helpful because only the special servicer can extend the loan or offer forbearance.

"Now is not a good time to be out there all alone," Levy says. "We're in uncharted waters right now, and a lot of owners and developers need help. This market is dicey."
Firm Background

(John B. Levy & Co.-owned Power Mill Road Office Building, Beltsville, MD., bottom left photo)

John B. Levy & Company, Inc. is a real estate investment-banking firm headquartered in Richmond, Virginia.

Since John Levy founded the company in 1995, the firm has structured over $3.5 billion in financing for developers and owners of commercial and multi-family projects nationwide, often investing its own proprietary funds into transactions with its clients.

Mr. Levy is an expert on commercial real estate financing and the effects of interest rates on commercial real estate markets. He is the originator and author of the Barron's/John B. Levy & Company National Mortgage Survey, a monthly survey of more than 30 of the country's largest institutional investors, as well as buyers and sellers of commercial mortgage-backed securities, which Barron's published for over 23 years.

(John B. Levy & Co.-owned office portfolio in MD and VA, bottom right photo)

Mr. Levy is also co-creator of The Giliberto-Levy Commercial Mortgage Performance Index (sm), the first and pre-eminent index to measure and analyze the performance of investments in the commercial mortgage industry.

Additionally, he is a member of the Board of Directors of Anthracite Capital Inc. (NYSE: AHR), a New York Stock Exchange REIT managed by BlackRock, Inc and a former director of Value Property Trust.

For more information about John B. Levy & Company, please visit the firm's website at http://www.jblevyco.com/ or call Andrew Little at 804-644-2000, extension 260.

Fitch: U.S. CREL CDO Delinquencies Continue to Rise

NEW YORK, NY, April 20, 2009--Twenty-one newly delinquent assets led to an increase in U.S. commercial real estate loan (CREL) CDO delinquencies to 6.5% for March 2009, up from 5.4% in February 2009, according to the latest CREL CDO delinquency index (CREL DI) from Fitch Ratings.

Fitch currently rates 35 CREL CDOs encompassing approximately 1,100 loans and 370 rated securities/assets with a balance of $23.8 billion.

28 CREL CDOs contained at least one delinquent loan with individual delinquency rates ranging from less than 1% to 22.1% of the CDO par balance, as of the March 2009 reporting period.

Fitch continues to monitor CDO delinquencies on a monthly basis. Since September 2008, Fitch has taken negative actions on 20 of its 35 Fitch-rated CREL transactions with more downgrades and Negative Rating Watches anticipated as transactions are reviewed.

In contrast to the recent trend of limited repurchases, six assets (27 basis points of the CREL DI) were repurchased from three different CDOs in the March reporting period.

One asset manager repurchased two assets from its CDO at par, while the four other assets from two different CDOs were repurchased at an average discount to par of 46.3%, including one defaulted security that was repurchased at 0.001% of par.

Many CDOs allow for repurchases at prices below par based on market pricing or third party opinion of value.

The repurchases were likely prompted by an effort to maintain cushion in par value tests, thus avoiding the diversion of cash flow from the CDO’s preference shares.

While only one repurchased asset was haircut in the prior month for purposes of its CDO’s par value calculation; the remaining assets were expected to be haircut imminently based on their impaired statuses.

In most cases, new higher rated assets were traded into the CDO at a discount within a few days of the repurchases to re-build the total CDO par. Fitch considers asset purchase prices in its evaluation of CDO collateral.

‘Further maturity defaults are likely as the illiquid credit markets provide limited prospects for the payoff of loans,’ said Senior Director Karen Trebach.

Excluding the repurchased assets, nearly all of the new additions to the CREL DI consist of matured balloon loans.

Further, reported loan extensions decreased to 21 for the month, down from 37 in February, and more in line with the prior two months’ totals.

Non-cash flowing property types comprise the highest percentage of assets in the CREL DI. Loans backed by interests in land are now the highest percentage of assets in the CREL DI at approximately 32%.

Condominium conversions and construction loans comprise an additional 11.1%. ‘Under the current credit market conditions, Fitch anticipates increased defaults on land loans as debt service reserves burn off and business plans fail to actualize,’ said Trebach.

The CREL DI includes loans that are 60 days or longer delinquent, matured balloon loans, and the current month's repurchased assets.

Contacts:

Karen Trebach +1-212-908-0215 or

Stacey McGovern +1-212-908-0722, New York.

Media Relations: Sandro Scenga, New York, Tel: +1 212-908-0278.

SPECIAL REPORT: Crawling Economy Dents All Metro Retail Markets

WASHINGTON, DC—Unless you have been visiting an uncle on Mars for the past five years, everybody on Planet Earth knows the retail sales and investment market is in the dumpster.

However, in its periodic review of 38 U.S. metropolitan markets, Encino, CA-based Marcus Millichap finds most brokers still optimistic on a market rebound this year but none willing to venture when that will happen.

Here is a sector-by-sector quick market analysis:

Northeast

In New York, for example, Edward Jordan, (top right photo) regional manager of the Manhattan office, says “despite the slow start, long-term hold opportunities could pull liquid buyers off the sidelines in the second half of the year.”

Gary Lucas, (top left photo) regional manager, Boston, maintains “retail investment opportunities persist in Boston, despite a softening fundamental outlook. Investors seeking stability may want to consider assets in the core submarkets of Brookline, Cambridge and Waltham.

“ Limited new inventory and steady demand in these areas will support occupancy levels this year, although properties will trade at premium prices.

In Washington, DC, “sales of multi-tenant properties have slowed, reflecting investors’ concerns about competition from recent supply additions and the challenges of re-leasing space in older assets,” points out regional manager Ramon Kochavi.

In nearby Virginia, for example, Kochavi says cap rates on older shopping centers start in the low-8 percent range, while Class A assets can trade at 7.2 percent to 7.8 percent.

Philadelphia regional manager Spencer Yablon (middle right photo) is a realist on his market. “Philadelphia’s mature market conditions present a reasonably positive long-term investment outlook, although reduce tenant demand will slow transaction velocity in 2009,” he says.

“Single-tenant properties with national-credit tenants, which trade with cap rates in the low-7 percent range will remain popular, especially assets priced below $$3 million.

Midwest

Milwaukee regional manager Matthew Fitzgerald (middle left photo) says “concerns over weakening fundamentals are expected to slow transaction velocity in 2009. Buyers are projected to target properties in densely inhabited Wisconsin areas, like Wauwatosa and West Allis.”

Like Milwaukee, Minneapolis regional manager Solomon Poretsky sees fewer sales deals surfacing this year, as “investors remain cautious due to weaker fundamentals. Out-of-state buyers will be relatively inactive, allowing local investors to selectively target assets that best fit their criteria.”

Gary Lucas, who manages the Boston, Charlotte and Kansas City offices, says investors “began to focus on the (Kansas City) suburbs last year, as redevelopment efforts downtown have been slow to gain traction.

“Local buyers who can handle management-intensive assets will likely target older properties in Johnson and Platte counties, where retail sales are forecast to grow and space demand is still fairly strong.”

Columbus, OH regional manager Steven Weinstock (middle right photo, under Spencer Yablon photo) is confident that “although sales activity is expected to remain subdued in the early part of 2009, the long-term prospects for Columbus will encourage investor interest in local properties.

“The metro continues to add households, a rare trend in the Midwest, and the spending power of an educated, well-paid work force is attractive to retailers.”

Detroit regional manager Steve Chaben (middle left photo, under Matthew Fitzgerald photo) is equally optimistic for his area. “Retail investment opportunities are project to emerge in Detroit, despite the current economic turmoil,” he says. “Private investors will make up the largest portion of the buyer pool as institutions and REITs shy away from the perceived risk associated with the local economy.”

In Indianapolis, “following two years of above-average metrowide sales activity, transaction velocity is expected to return to a more modest pace in 2009,” says regional manager Joshua Caruana (bottom right photo, under Steven Weinstock photo)

“Cap rates for multi-tenant properties average approximately 8.5 percent, while single-tenant deals are trading with initial yields in the high-7 percent to low-8 percent range, high enough to generate interest from out-of-state buyers.”

Cleveland regional manager Michael Glass looks for “opportunistic local buyers to remain active this year, targeting value-add properties in densely populated suburban submarkets, including Parma and Shaker Heights.

“Experienced cash buyers are seeking mismanaged assets but are being selective in negotiating purchase terms, causing cap rates marketwide to continue to rise.”

Steven Weinstock, who manages the Columbus and Cincinnati offices, says investment activity in Cincinnati this year is “expected to be conservative, though price corrections should be modest.

“Over the past few years, acquisition activity in the local retail market has centered on operational fundamentals, rather than on speculation for short-term gains. Consequently, price and velocity are not likely to fluctuate significantly.”

In Chicago, regional manager Greg LaBerge (middle right photo, under Joshua Caruana photo) says “citywide, cap rates in the multi-tenant segment currently are in the mid to high-7 percent range, but could climb by as much as 100 basis points in 2009.

“Single-tenant initial yields are forecast to increase at a more modest pace, and will likely approach the mid to high-7 percent range by year end.”

Southeast

West Palm Beach, FL regional manager Gregory Matus says that while many properties were on the market as 2009 started, “few deals are closing amid credit concerns. Cap rates on top multi-tenant assets are settling in the mid-7 percent region.”

In Tampa, regional manager Bryn Merrey (middle right photo, under Greg LaBerge photo) notes that “as Tampa and other major markets proceed into a period of diminished property performance, retailers and investors remain largely upbeat about the metro’s long-term prospects.

“Optimism is supported by the project addition of more than 20,000 households annually over the next five years and the impact those residents will have on retail space demand.”

Orlando owners and investors “still embrace the metro area’s long-term prospects for robust household and income growth, but soft property fundamentals will slow activity in the first part of 2009,” predicts Bryn Merrey, who also manages the Tampa office.

“Nevertheless, the ongoing re-pricing of properties is resulting in rising cap rates, and buyers could start to return to the market as the year unfolds.”

In Miami, cap rates on multi-tenant properties occupied by local or small regional tenants start at about 8 percent and are expected to inch up in the months ahead as vacancy rises,” notes regional manager Kirk Felici (middle left photo under Bryn Merrey photo) “Assets with national tenants can trade in the mid-7 percent range.”

Fort Lauderdale regional manager Gregory Matus, who also manages the West Palm Beach office, says cap rates for multi-tenant assets are “inching up toward the 8.5 percent to 9.0 percent range. Properties pricing within this band reflect the current and forecast weakness in operating fundamentals and are expected to bring an increasing number of buyers back into the market.”

In Jacksonville, “despite fundamental weakening, retail investment opportunities persist, particularly in the far southern reaches of the metro, near Interstate 95 and St. Augustine Road,” says sales manager David Bradley.

“Approximately 1,900 multi-family units are scheduled to be completed in the area over the next two years, and office development is picking, generating demand (also) for retail.”

Gary Lucas, who manages the Boston, Kansas City and Charlotte offices, says “turmoil and uncertainty within the banking and finance industries have caused investors to approach retail investments in Charlotte conservatively.

“Cap rates for Class A multi-tenant properties in sought-after residential markets were in the mid to high-7 percent range at year-end 2008 and are expected increase further this year.”

In Atlanta, investment activity “will remain modest this year, and cap rates are expected continue to edge higher through the metro,” says regional manager John Leonard (middle right photo, under Greg LaBerge photo) . “As sales activity in the multi-tenant segment slowed in 2008, cap rates pushed into the low-7 percent to mid-8 percent range.”

Southwest

Tucson regional manager David Guido says, “Near-term fluctuations aside, Tucson’s emerging status as a viable, long-term market for national retail chains will sustain investor interest.

“Cap rates in the low-7 percent range for single-tenant assets and high-8 percent range for multi-tenant deals are lower than the region’s long-term averages, which may encourage some owners to sell.”

Salt Lake City, like most of the other major markets, will see fewer deals this year, says regional manager Richard Bird. “The pricing expectations gap, restrictive lenders and weakened fundamentals (will) deter some investors.”

“Investor sentiment in San Antonio will remain positive during 2009, though activity among regional buyers may decline,” says regional manager J. Michael Watson. “As such, sellers may have to realign pricing expectations to compete with rising cap rates in the state’s larger metros.”
Las Vegas regional manager John Vorsheck remains bullish on his area. “Projected long-term population growth and Las Vegas’s status as a tourist destination will maintain investor interest in retail properties,” he believes. However, “sales velocity during the first half will likely be suppressed.”

Out-of-state buyers “are expected to play a less active role in the Dallas-Fort Worth retail market this year,” says regional manager Tim Speck (middle right photo, under John Leonard photo). “As a result, local investors may begin to expand their presence.”

Investors in Denver “will employ more cautious strategies this year, targeting single-tenant and top-tier multi-tenant assets in areas where space demand will outpace the metro average,” forecasts regional manager Adam Christoferson (middle left photo, under Kirk Felici photo).

“Cap rates for assets in these areas, which include Lakewood and Arvada, are currently in the mid to high-7 percent range and are expected recede slightly in the coming months.”

The Houston retail market “will remain an attractive option for investors due to the relative health of the local economy and the metro’s history of shallow contractions during previous recessions,” says regional manager Michael Hoffman.

“As REITs and institutions slow acquisition activity over the coming months, local buyers are expected to seek higher-end multi-tenant deals in core locations, which had bee more difficult to obtain in recent years.”

Far West

Investment activity is “expected to move forward at a moderate pace this year in the San Jose retail market,” says Steven Seligman, (middle left photo, under Adam Christofferson photo) regional manager of the Palo Alto office. “Buyers will continue to look to value-add opportunities, capitalizing on foot traffic and retailer demand near existing properties such as Santana Row and the Westfield Valley Fair Shopping Center, where builders are proposing a 600,000-square-foot redevelopment.”

Seattle’s “extended economic outlook and elevated development costs will continue to support healthy investor sentiment, but the wave of cooling fundamentals and a more conservating lending environment will result in reduced sales velocity,” says regional manager Gregory Wendelken. (middle right photo, under Tim Speck photo) “In recent years, large private buyers and institutions flocked to Seattle, a trend that is expected to taper off in the near term.”

Sacramento’s investment retail market activity “will be minimal early in 2009, though a rise in listed properties may generate some activity by mid-year,” regional manager Robert Hicks. “Cap rates for single and multi-tenant assets, both currently averaging in the high-6 percent range, are expected to rise during the year.”

San Diego’s track record of strong operating conditions “will attract investors, though a buyer-seller disconnect persists,” points out regional manager Kent Williams. “Given the current economic weakness, assets that serve primary needs, including grocer-anchored centers and drugstores, should outperform specialty and luxury shops and attract buyers.”

“Tourism spending and the affluent neighborhoods that surround core shopping districts support San Francisco’s potential for a swift recovery and will ustain investor interest in the local retail market,” says regional manager Jeffrey Mishkin (middle left photo, under Steven Seligman photo) . “A disparity between buyers’ and sellers’ expectations, however, could continue to hamper trading this year.”

Long-term investors “will maintain a presence in the (California) Inland Empire, targeting areas that are expected to rebound the fastest, such as the centrally located cities of Corona, Ontario and Rancho Cucamonga,” says Douglas McCauley, (bottom right photo, under Gregory Wendelken photo) regional manager of the Ontario office.

Still, he says, “transaction velocity metrowide will likely remain suppressed due to a wide pricing expectations gap between buyers and sellers.”

In Oregon, “Portland’s retail assets will continue to attract investors this year due to minimal competition from new stock,” says regional manager Tony Cassie. “Stabilized infill properties in the urban core, where new high-end apartment and condo developments have increased population density, will continue to garner attention from buyers.”

In Oakland, “minimal competitive threats from new construction will continue to attract investors with long-term holding objectives, though transaction velocity will remain measured this year, as uncertainty over the metro’s economy sidelines some buyers,,” says regional manager Jerry Smith.

“Owners seeking to exit the market will likely have to price assets below earlier valuations, which could attract buyers seeking discounts. Additionally, properties located near BART (transit) stations, such as the West Dublin-Pleasanton terminal scheduled to open this year, should generate increased interest.”

Orange County’s “embedded wealth (in California) and lack of developable land will help to maintain investor interest in local retail properties this year,” predicts Joseph Cesta, regional manager of the Newport Beach office. “Transaction velocity will vary by asset class, however, as buyers are expected to remain cautious when evaluating multi-tenant properties.”

In Los Angeles, “a favorable extended outlook will eventually lure retail property buyers, although sales activity is expected to remain limited throughout much of 2009,” says regional manager Stephen Stein (bottom right photo)

“Investors will likely consider mixed-use projects in coastal cities such as Hermosa Beach and Manhattan Beach, given the lack of developable land in these locations.”

Contact: Stacey Corso, Corporate Communications, Marcus & Millichap, stacey.corso@marcusmillichap.com

Starwood Suit Alleges Hilton Stole Over 100,000 Trade Secret Files on New Brand

WHITE PLAINS, NY—Starwood and Hilton, two of the world’s largest hotel chains, are at each other’s throats in a multi-million-dollar corporate espionage lawsuit filed in Federal Court here.

(Hilton's Beverly Hills, CA headquarters building, top right photo)

The suit alleges former Starwood executives Ross Klein and Amar Lalvani stole more than 100,000 electronic and hard-copy files related to the emerging lifestyle hotel market, before and after they were hired away by Hilton in 2008.

The suit alleges the stolen files focused on Starwood’s W hotel brand.

Hilton, acquired by New York City-based Blackstone Group in 2008, is rushing to come out with its new lifestyle brand called Denizen.

The Beverly Hills, CA-based chain plans to showcase Denizen in several major cities, including Beverly Hills and Abu Dhabi.
The suit aims to stop the debut of this brand.

Denizen is expected to compete with independent hotels and boutique properties, including Starwood’s W line, Morgans Hotel Group Co. and Thompson Hotels.

The suit also will be asking for punitive and compensatory damages totaling “in the millions,” according to industry sources in a position to know.



The suit is expected to take at least a year to settle, according to persons familiar with similar court actions.

Hilton spokesman Michael Buckley called the suit “frivolous and without merit.” He says Hilton will vigorously defend itself against the allegations.

Starwood’s lead lawyer Kenneth Siegel charges Hilton’s alleged theft amounted to a “wholesale looting of proprietary Starwood information.”

He calls the action “a blatant case of theft of trade secrets.”

Siegel says the stolen files included “a step-by-step playbook for creating a lifestyle luxury hotel brand.”
But the most damaging aspect of the alleged theft was that the files “enabled Hilton to launch a new brand in only nine months instead of the usual three to five years,” Siegel charges.

Klein was the former president of Starwood Luxury Brands Group. Lalvani was senior vice president of that unit. At Hilton, Klein is head of luxury and lifestyle brands; Lalvani, is head of development for the same division.

Besides the W brand, Starwood operates the Sheraton and St. Regis hotel chains.

Aswin Suri opens new Exit Realty of Daytona Real Estate Brokerage

Firm recruits 28 new agents and expects to hire 70 more this year.

DAYTONA BEACH, FL - Exit Realty has moved into its new facility at 211 E. International Speedway Blvd. in Daytona Beach and has already recruited 28 new realty agents.

Exit Realty Owner Aswin Suri, (middle right photo) who has more than 25 years of experience in real estate, said Exit Realty is undergoing something few recession-era companies can report: a growth boom.

"We expect to have more than 100 agents before the end of this year," Suri said.

Over the past two years, Suri sold real estate properties worth more than $62 million, and ranked number one in sales volume for 2007 and 2008.

"Right now we have 24 commercial and residential sales under contract valued at more than $5 million," Suri said.

Exit Realty spent more than $100,000 to renovate a three-story, 8,000 square foot building as its new headquarters, Suri said. A grand opening and ribbon-cutting event are planned for April 24 with local elected officials and business leaders.

For more information, please contact:

Aswin Suri, MHA, B.A., Owner Exit Realty of Daytona, 386-383-3000 (direct)

Larry Vershel or Beth Payan, Larry Vershel Communications, 407-644-4142

Sheila Goodman, Larry Vershel Communications, 407-644-4142 P407-644-4410 F

CBRE"s Erik Schwetje Negotiates Four Leases Totaling 87,429 SF in Orlando

ORLANDO, FL-- The Orlando office of CB Richard Ellis is pleased to announce the following four leases launching a great start to the second quarter of 2009 at four industrial centers by their exclusive leasing agent Erik W. Schwetje, (top right photo) Vice President.

Enterprise Electric is planning an expansion at Airport Commerce Center (bottom left aerial) and signed a deal new for approximately four and half years of 4,800-sq.ft. at 1629 Parkline Boulevard, Suite 500, Orlando, Florida.

East Coast Intimates signed a new deal for 3,219-sq.ft. at the Sand Lake Service Center at 7661 Currency Drive, Orlando, Florida.

Kauffman Tire signed a two-year extension of 50,400-sq.ft. in the Presidents V Building located at 7482 Presidents Drive, Orlando, Florida.

Ann Huntington, Senior Vice President of CBRE in Dallas and David Murphy, Senior Vice President of CBRE in Orlando represented the tenant.

Ace Relocation Systems, Inc. signed a two-year renewal on 29,010-sq.ft. at the Beeline Distribution Center located at 2507 Investor's Row, Suite 400, Orlando, Florida.

For more information about Erik W. Schwetje, CCIM, visit www.cbre.com/erik.schwetje

Contact: Angelique Greven, 407.839.3158, angelique.greven@cbre.com

Johnson-Laux of Orlando Ranked 172nd Largest GC

ORLANDO, FL – Orlando-based general contractor Johnson-Laux Construction was prominently ranked as the Southeast’s 172nd largest general contractor in Southeast Construction Magazine’s 2009 Top General Contractors survey published in its April issue.

Led by President and LEED Accredited Professional Kevin Johnson, and Vice President Anthony Laux, (top left photo) Johnson-Laux is a full-service construction management and general contracting firm specializing in mission-critical healthcare, industrial, multi-family, municipal, office, retail and other projects throughout Central Florida.


Contact: Kenneth H. Cristol, 407-774-2515

Roger B. Kennedy Inc. Ranked 5th Largest General Contractor

ORLANDO, FL – Altamonte Springs-based Roger B. Kennedy, Inc. was prominently ranked as Central Florida’s 5th largest general contractor in Orlando Business Journal’s 2009 Top General Contractors survey published April 3, 2009.

Led by Roger B. Kennedy, Jr., (top left photo) President, the company reported 2008 revenues of $82.6 million. The company also ranks as one of Central Florida’s largest family-owned businesses.

Contact: Kenneth H. Cristol 407-774-2515

Sikon's Scott Speaks to Real Estate Students at UCF

ORLANDO, FL – Florida retail construction veteran Dale E. Scott, (top right photo) Senior Executive Vice President of Deerfield Beach-based SIKON Construction Corporation, one of the nation’s leading commercial contractors, served as symposium co-moderator along with Crossman & Co.’s John Crossman (bottom right photo) on March 25 at the University of Central Florida’s Dr. P. Phillips School of Real Estate.

Topics covered at the interactive presentation included strategies for real estate students entering business careers with an emphasis on networking and character-building issues.

Attended by approximately 40 undergraduate real estate students, the event was held in the classroom of Randy I. Anderson, Ph.D., (bottom left photo) who also serves as the inaugural Howard Phillips Eminent Scholar Endowed Chair at UCF’s Dr. P. Phillips School of Real Estate.

Contact: Kenneth H. Cristol 407-774-2515

Camden Property Closes $420 Million Fannie Mae Credit Facility

HOUSTON, TX, (BUSINESS WIRE)--Camden Property Trust (NYSE:CPT) announced the closing of a $420 million secured credit facility with Red Mortgage Capital, Inc., a Fannie Mae DUS® lender.

The ten-year facility has a fixed annual interest rate of 5.12% with payments of interest only, and matures on May 1, 2019. The loan is secured by 11 multifamily communities.

Camden intends to use the proceeds from this credit facility for the pay down of amounts outstanding under its revolving line of credit, retirement of existing debt and for general corporate purposes.

Prior to this transaction, the Company retired $46 million of secured mortgage debt which was scheduled to mature in early 2010.

Camden owns interests in and operates 181 properties containing 62,903 apartment homes across the United States. Upon completion of five properties under development, the Company’s portfolio will increase to 64,329 apartment homes in 186 properties.

Camden was recently named by FORTUNE® Magazine for the second consecutive year as one of the “100 Best Companies to Work For” in America.

For additional information, please contact Camden’s Investor Relations Department at 800-922-6336 or 713-354-2787 or access our website at camdenliving.com.

Camden Property Trust, Kim Callahan, 713-354-2549

General Growth’s Chapter 11 Filing Called Largest in U.S. Retail Bankruptcy History

CHICAGO, IL—In what industry insiders are calling the largest retail real estate bankruptcy filing in U.S. annals, Chicago-based General Growth Properties Inc. has voluntarily filed for protection from its creditors under Chapter 11 of the U.S. Bankruptcy Code.

(South Market in Boston, one of General Growth Properties' assets, top right photo)

Industry sources in a position to know say the General Growth Properties’ filing could be the first of several similar legal actions that may also be taken voluntarily this year by other major retail developers and investors.

Shopping center industry watchers predicted the April 16 filing after the 45-year-old mall developer couldn’t get all of its creditors to extend loan payment and payoff dates until the end of this year or longer, as Real Estate Channel previously reported.

Courts in several states in March had already ordered the seizure of about six GGP shopping centers after the developer failed to meet various loan payment deadlines.

GGP’s filing in New York listed assets of $29.5 billion and debts of about $27.3 billion.

In a prepared statement, the company said all of its 200 retail centers in 44 states will remain open for business as its bankruptcy hearing continues in the Southern District of New York’s federal bankruptcy court in New York City.

Pershing Square Capital Management LP of New York City is loaning GGP $375 million to help with day-to-day operational costs.

Pershing principal William Ackerman (middle right photo) has previously stated his firm is taking a 25 percent ownership stake in the shopping center company. That would make Pershing the third largest shareholder in General Growth Properties.

The Chapter 11 filing lists Eurohypo AG of Eschborn, Germany, a unit of Commerzbank AG, as GGP’s largest unsecured creditor with claims on two loans totaling $2.59 billion.

Eurohypo is the administrative agent for 175 separate creditors. Only 10 percent of the loans are held by Eurohypo. Note holders of General Growth Properties bonds are owed a total $4 billion.

“Our core business remains sound and is performing well with stable cash flows,” says GGP CEO Adam Metz. “We believe that chapter 11 is the best process for restructuring maturing mortgage loans, reducing the company’s corporate debt, and establishing a sustainable, long-term capital structure for the company.

“While we have worked tirelessly in the past several months to address our maturing debts, the collapse of the credit markets has made it impossible for us to refinance maturing debt outside of chapter 11.”

Metz said in the prepared statement, “The company has requested, and expects to receive, additional (court) approvals to give the company the authority to make payments to ensure that the company’s shopping centers and other properties continue to operate uninterrupted in the ordinary course of business, including paying employee compensation, certain critical service providers, insurance and other claims.

“The Company intends to pay all providers of goods and services delivered post-petition.”

General Growth Properties’ portfolio totals about 200 million square feet of retail space and includes over 24,000 stores nationwide.

(Faneuil Hall Marketplace, Boston, one of General Growth Properties' assets, bottom left photo)

The Company is listed on the New York Stock Exchange under the symbol GGP. Its common stock traded today (April 16) at $1.05, up from 57 cents on March 21 but down from its all-time high of $67 per share in March 2007.