In the News—Week of May 3, 2023
Deal of the Week
A Scottsdale-based developer closed on a $47 million construction loan from a New York-based bank for a multifamily project within a master-planned community in Peoria, Arizona. The apartment complex will feature 208 units, a pool, various courtyards, and a dog park across the 16 acres. The loan transaction was closed by Joel Montemayor, Assistant Vice President and Commercial Escrow Officer, in our Scottsdale office.
San Francisco office tenants are exploring options across the Bay
As the office market in downtown San Francisco stagnates, the outlook is much sunnier in the East Bay suburbs, The Real Deal reports. Figures from CBRE show that office tenants are looking for about 2 million square feet in those communities such as Concord, Walnut Creek, San Ramon and Livermore. Rents tend to be cheaper in the suburbs, and the commute is easier for many workers. “Workers are used to working from home and having flexibility in their schedules, so the desire to spend more than an hour a day to commute to the office is a lot less than pre-pandemic,” CBRE’s Jeff Birnbaum explains.
Owner of NBA Hawks bets heavily on the future on downtown Atlanta
Tony Ressler is moving forward with plans to invest $5 billion in an old railyard in downtown Atlanta and turn it into a mix of hotels and restaurants, residences and offices, Fortune reports. the billionaire co-founder of Ares Management and owner of the NBA Atlanta Hawks, says the recent property downturn doesn’t scare him. “We’re not worried about any of that,” Ressler says. “Higher or lower interest rates may change your rate of return but will not determine the success or failure of a project. For us, the project is funded, and we’re full steam ahead.” Work has begun on the first hotel and residential building in what will be known as Centennial Yards.
Office still challenging, but there is optimism about Detroit suburbs
Industrial and multifamily are going strong, retail is adapting and there’s even some hope for office in the Detroit suburbs, RE Journal reports. Those were the major themes discussed at the 2nd annual Detroit Suburban State of the Market, put on by the Journal and Midwest Real Estate News. There are challenges, such as high-interest rates, inflation and a shortage of workers, but the Detroit suburbs are bouncing back. The office sector remains the most challenged, and it is still unclear how much space will be needed going forward as more workers want to work from home.
Opportunities abound for sharp investors in New York City market
Cratering prices in NYC commercial real estate market are a disaster for many — but a “once-in-a-generation opening” for others, Mortgage Professional America reports. A study by Okada & Co. CEO Chris Okada says that most CRE loans generated in the past eight years are underwater. But that offers the savvy investor great value. “A building on Fifth Avenue owned by the Silverstein who built the World Trade Center sold the property they’ve owned for 20, 30 years for $400 per square foot,” he explains, “I’d like to think, at the top of the market, pre-pandemic, $900, $800 a foot. Land was trading at $600, $700 a foot at the peak. Now you get a whole building for $400 (per square foot).”
Partners say ex-pro football player turned developer owes them millions
A former pro football player is accused of owing business partners and employees more than $8 million, ABC 15 reports. Cameron Colvin — who was a star wide receiver at Oregon and briefly signed with the San Francisco 49ers but played no games before appearing in four games for Las Vegas Locomotives of the United Football League — owns Scottsdale-based company CamCo Commercial. ABC 15 found Colvin has nine civil court judgments against him. In 2019, Colvin announced his plans to build Akimel 7, a major sports and entertainment complex on Salt River Indian Community land. Included in the plans were a major resort, a movie studio and a stadium large enough to host World Cup soccer games. Nothing was ever built, and a company that partnered with him won a civil judgment of more than $7 million, the TV station reports.
Mega-resort with musical theme takes shape later than expected
It was supposed to be ready in time for the Super Bowl. Then it was supposed to be ready by this spring. Now the opening date for the VAI Resort in Glendale near State Farm Stadium is scheduled to open sometime in 2024, KTAR reports. The developer announced some more details about the $1 billion project. Besides having the largest hotel in the state, with 1,100 rooms and 12 restaurants, VAI will include the first Mattel theme park, featuring Hot Wheels, Barbie and Thomas the Tank Engine attractions. A tower will offer 160 rooms with balconies that can serve as skyboxes for concerts at the resort’s 8,000-seat amphitheater. And the rest will boast a temperature-controlled lagoon lined by nearly a mile of sandy beaches.