In the News—Week of December 18, 2023
Deal of the Week
Two Arizona-based investors traded three parcels in Phoenix, totaling 2.6 acres. The properties are active parking lots that service the sports, entertainment, and warehouse districts in Downtown Phoenix. The $17,300,000 transaction was closed by Sheila Hunter, Vice President and Senior Commercial Escrow Officer.
Ever-so-quietly, Sears brings back two of the stores it closed
Sears has been shutting down stores across the country for the last several years. But a change may be afoot. The company recently reopened a store in Burbank, California, and another in Union Gap, Washington, RetailWire reports. Simeon Siegel, a retail analyst at BMO Capital Markets, tells the website that a brand like Sears could rebound, and big stores offering a wide array of products can thrive in the digital age.
Downtown San Jose office tower sells for less than a third of its price in 2017
An 11-story office tower that once fetched the record-high price for an office building in downtown San Jose has been sold for less than a third of the price it garnered in 2017, Silicon Valley.com reports. The building, at 303 Almaden Blvd., has been bought for slightly under $23.8 million to a group headed by George Mersho, chief executive officer of Shoe Palace. Boston-based AEW Capital Management paid about $80.2 million in 2017. That was about $509 a square foot, the most anyone had paid for office space in San Jose’s central business district. The price per square foot in 2023 was about $151. “This deal is a positive sign for the office market,” says Dave Sandlin, an executive vice president with Colliers, a commercial real estate firm. “We now know the price that a Class A building in San Jose will trade for, and in this case, a prime, Class A office building.”
Hedge fund’s bid for Macy’s draws interest for retailer’s real estate
Arkhouse Management and Brigade Capital Management have offered $21 a share to take Macy’s private. The department-store chain’s prospects from running its retail business don’t impress Wall Street analysts, the Real Deal reports. But Macy’s real estate portfolio may be the real attraction for this deal. Analysts peg the value of Macy’s real estate holdings at $6 billion to $8 billion. Which is in the neighborhood of the equity funds’ bid for the whole company. “When you look at the value of Macy’s, the real estate is the jewel,” says Neil Saunders of research firm GlobalData. The new owners also could spin off the better performing retail brands, such as Bloomingdale’s.
Miami enjoys uptick in volume of CRE deals during third quarter
Miami’s office sales in the third quarter were triple the volume in the first quarter of 2023, Commercial Search reports. Miami’s office sales volume reached $309 million and 1.1 million square feet in the third quarter as the area reemerged as a hotspot for corporations. The first quarter saw sales of $100 million and 762,836 square feet. Year to date, the market is garnering $349 per square foot, ranking only behind Manhattan ($568 per square foot and Austin ($425 per square foot).
Mesa sports complex emerges from bankruptcy with new name
A 320-acre sports complex in Mesa has a new owner and a new name, 85209.com reports. The former Legacy Sports Park will be known as Arizona Athletic Grounds after Burke Operating Partners LLC and Rocky Mountain Resources bought the facility for $25.8 million. The nonprofit that owned the complex had filed for Chapter 11 bankruptcy protection in May. The facility includes a 3,000-seat outdoor stadium, a 2,800-seat indoor arena, 35 fields for soccer, lacrosse and football, 57 indoor volleyball courts, and eight baseball and softball fields.
324-unit apartment complex in Tempe sells for more than $100 million
Parc Broadway, a 324-unit apartment complex in Tempe that was finished this year, sold for $100.25 million, AZ Big Media reports. Evergreen Devco sold the 9-acre complex to MG Properties. “Parc Broadway is the first mid-rise multifamily asset to be constructed in North Tempe’s Maker District, an Opportunity Zone that is one of the city’s nine innovation hubs,” says Steve Gebing, executive managing director for IPA Capital Markets, which arranged financing for the deal. Located along Broadway Road, the property is close to Interstate 10 and the 60 freeway. The average unit size is 895 square feet.