In the News—Week of January 1, 2024
Deal of the Week
In a portfolio refinance transaction, a Chicago-based investment group closed a $77,500,000 loan from a private, Maryland-based real estate lender. The loan is secured by a 20-acre parcel in Apache Junction, Arizona and an 18.2-acre parcel in Goodyear, Arizona. The title operations team in Thomas Title’s Scottsdale office handled all of the title production, as part of Stewart Title’s National Commercial Services network.
Prada decides to buy building on Fifth Avenue that houses flagship store
For years, we’ve heard of companies selling off buildings that house their operations and then leasing them back. Prada is going in the opposite direction. The Italian fashion house says it will buy the building that has housed its flagship store since 1997, the New York Post reports. Prada will pay $425 million for 724 Fifth Avenue. Prada leases five floors in the 12-story building. “The board believes that the property’s location offers high strategic value being characterized by increasing scarcity and long-term potential,” Prada says.
Revised plan adds residential units for project near San Francisco mall
In an effort to get the city of San Francisco to allow the project, Brookfield Properties has revised its plan for development around the Stonestown Galleria, The San Francisco Standard reports. The new plan, shown to the Planning Commission, calls for 500 more homes and axing a hotel. “The hearing was an important milestone for the project and the first step in the approval process,” says Anne Yalon, a spokesperson for the city’s Planning Department. “We are pleased that the project has been revised to include more housing.” If the city OKs the project, the revamp will be completed in the next 10 to 20 years.
Amazon declines to renew lease in downtown Seattle office tower
Amazon had decided not to renew a 209,000-square-foot lease in a downtown Seattle office tower, Connectcre reports. About 1,100 Amazon employees based in the 1800 Ninth Tower will move to other offices in the Seattle area when the lease ends in February. Amazon has reduced its office footprint in downtown Seattle by almost 800,000 square feet since 2020. The company has been moving workers to facilities across Lake Washington in Bellevue.
Mall owner PREIT files for bankruptcy for second time since COVID outbreak
Here we go again: Philadelphia-based Pennsylvania Real Estate Investment Trust, which sought bankruptcy protection during the COVID-19 pandemic, filed for bankruptcy protection a second time, Reuters reports. This time PREIT is aiming to cut $880 million of debt and take the company private. In court filings in Wilmington, Delaware, the company cited declines in retail sales, high inflation and interest rates for the company’s inability to manage its $1.1 billion in debt. PREIT owns 23 properties, including 19 shopping malls, primarily in the Mid-Atlantic region.
Each vacant apartment in Phoenix area sought by nine potential tenants in ’23
Renters faced tough competition when it came to finding an apartment in 2023, AZ Big Media reports. Figures from Rent Cafe show on average there were nine potential tenants vying for each apartment vacancy. That was actually good news for renters. There were 13 potential renters for each opening in 2022. An apartment stayed vacant for an average of 39 days in 2023, up from 33 days in 2022. Overall, Phoenix was rated at 59th hottest rental market.
The Ranch, Water Tower Plaza, battery plant are among high profile projects
Gilbert and Queen Creek in the southeast part of the Phoenix metro area are growing quickly. It’s difficult to track all the projects, but a few stand out, The Arizona Republic reports. The Ranch, a 331-acre master-planned project, finally got the OK form the Gilbert Town Council in April. Developers Indicap, Comena Group and Langley Properties plan to build light industrial, general commercial development and multifamily housing. Work on Gilbert’s Water Tower Plaza is set to start this month. The Plaza will be closed to the public until the additions, which include a new splash pad and a shaded picnic area, are done, which will probably be next fall. In Queen Creek, LG Energy Solutions is expected to begin work on its battery factory some time in 2024. The town’s new park and aquatic center are expected to be finished this year.