324,000-sf luxury retail property, located at the entryway of
CityCenter in the heart of the Strip. The sellers, a JV of MGM
Resorts International and Dubai World, were represented by JLL.
A few months later in July, General Growth Properties announced
it entered into a joint venture with TIAA Global Asset Management
to buy a 50% stake of the Fashion Show Mall. The deal valued the
$1.9-million-sf asset at approximately $2.5 billion. TIAA’s Mike Fisk
lead the deal for the TIAA Real Estate Account, which assumed an
$835-million first mortgage as part of the purchase. It went down as
the single-highest price paid for a retail asset in the US last year.
Then, in October, another JV—this time between Miller Capital
Advisory Inc. and CalPERS—paid $1.1 billion for the Miracle Mile
Shops within the Planet Hollywood Resort on the Strip. A partnership of Tristar Capital, Investcorp and RFR Holdings, represented
by HFF, sold the 500,000-sf property.
Of course, no mention of Vegas would be complete without
involving casinos. In September, Boyd Gaming Corp. closed on its
acquisition of the Aliante Hotel in North Las Vegas. A joint venture
of Standard General, Apollo Global Real Estate and TPG Capital
earned $380 million in the sale of the 202-room hotel and casino.
At $1.89 million per unit, the deal went down as the highest price
paid per unit for a lodging asset in the US last year.
ONE PLAYER’S EXIT MEANS ANOTHER’S WIN
And another record was set in Las Vegas’ multifamily sector, when
the Bascom Group teamed up with Oaktree Capital Management
to buy a 15-property portfolio from Camden Property Trust for
$630 million. The sale of the portfolio—comprised of 4,918 multi-family units, a 25,900-sf retail center and 19 acres of undeveloped
land—marked Camden’s exit from the greater Sin City market and
made Bascom the largest landlord in the area. It reportedly was
also the largest multifamily transaction in Las Vegas history.
Located throughout Western and Southeastern Las Vegas and
built between 1988 and 1997, the assets fit in with Bascom’s value-add strategy. CBRE Capital Markets represented Camden in the
deal and helped the Bascom/Oaktree joint venture secure a
$470.7-million acquisition loan. Meanwhile, Bascom’s Jerome A.
Fink, David S. Kim, Scott McClave and James Singleton acted for
RECORDS IN SECONDARY CITIES
A pair of apartment deals arranged by Marcus & Millichap
demonstrate investors’ willingeness to venture outside gateway cities. Both
set records for their vibrant but secondary markets. The Cobblegate
Apartments at 910 East 9000 South in the Salt Lake City suburb of
Who said portfolio transactions were few and far between in 2016? Or course, last year
didn’t offer as many bulk purchase opportunities
as the year or two before it, but quite a number of
properties changed hands in package deals.
The year started off with a bang in January,
when Starwood Capital Group closed its
$5.4-billion acquisition of 72 properties totaling
23,262 units from Sam Zell’s Equity Residential.
The deal, which had a reported cap rate of 5.5%
and was made on behalf of the Starwood Global
Opportunity Fund X, marked the largest non-hotel acquisition in the buyer’s history.
Comprising a mix of mid-rise and garden-style apartment buildings, the portfolio’s assets
are located in five states—including major concentrations in South Florida, Denver, Washington,
DC, Seattle and the Inland Empire, CA. The purchase brought Starwood Capital’s multifamily
portfolio to 88,000 units, making it one of the
largest owners of multifamily housing in the US.
Neal, Gerber & Eisenberg LLP served as EQR’s
legal advisor on the transaction.
Starwood Capital played a role in yet another
major deal last year, when it sold a $2-billion stake
in a number of its hotels to a consortium of investors led by China Life Insurance Co., the country’s largest life insurer. The trade involved 280
select-service hotels in 40 states valued at more
than $3 billion and encompasses select-service
brands of Hilton, Marriott, Intercontinental Hotel
Group, Hyatt and Choice Hotels.
Much of the portfolio came under Starwood
Capital ownership with its $1.2-billion acquisition
of TMI Hospitality in 2014, which traded a 188-
hotel portfolio, TMI’s management company and
its development platform. Starwood will continue
managing the assets after the deal with China Life.
China Life was just as active outside of the US,
buying a 49% share in six mixed-use projects in a
joint venture with Singapore’s GIC for $1.4 billion.
Mainland developer Joy City will retain the majority stake in the projects, one of which is located
Shanghai and the rest in Beijing.
In New York, Houston-based Hines emerged the
victor in a highly competitive bid to buy a share in
an 11-property portfolio owned by Trinity Church.
In a deal valued at $3.5 billion, the religious organi-
zation traded a 1% stake in the buildings to Hines
for $35 billion, and Hines will collect undisclosed
fees to manage and lease space at the properties.
The $35-million price tag is based on the buildings’
valuation determined in the 2015 deal that gave
Norwegian oil fund Norges a 44% interest in the
properties for $1.56 billion, valuing the portfolio at
$3.55 billion. CBRE’s Darcy Stacom handled the
deal for the sellers, Trinity and Norges.
A follow-up acquisition from Liberty Property
Trust more than
size of Workspace
portfolio, and also
Horsham, PA. The
by Liberty in July
of last year added
totaling 7. 6 million sf in four
states to what began as a 2.3-million-sf portfolio
of Horsham office and flex properties that the
newly launched Workspace had bought from
Liberty for $245.3 million in December 2015.
Workspace made the nearly $1-billion buy in partnership with Safanad Ltd.
In the spring of 2016, Malvern, PA-based
Liberty announced that it intended to sell between
$900 million and $1.2 billion of non-core suburban
NO DEARTH OF PORTFOLIO DEALS LAST YEAR
Workspace Property Trust teamed with Safanad Ltd. on a nearly
$1-billion purchase of Horsham, PA a 108-property, 7.6-million-sf portfolio of office and flex assets from Liberty Property Trust.