In the News—Week of September 25, 2023
Deal of the Week
A national real estate investor and developer with a substantial presence in the Arizona market purchased a retail property in Paradise Valley, Arizona. The 4.2-acre site sold for $15,000,000.00. The transaction was closed by Sheila Hunter, Vice President and Senior Commercial Escrow Officer in our Scottsdale office.
Life sciences real estate seems ready to bounce back
Life sciences commercial real estate is positioned to be a comeback kid, JLL reports. The top 20 venture capital firms that focus on life sciences have raised over $22 billion since 2021. The rest of 2023 likely will see large deals for companies with top-notch science deep into their clinical trials. “The relationship between funding rounds and startup expansion are symbiotic, driving growth throughout the biotech sector, and, while the public markets have slightly cooled off, private capital remains hopeful with record dry powder from top VCs focused on life sciences,” says Travis McCready, with JLL.
Japanese investors buy prominent office property on Park Avenue
Japanese real estate developer Mori Trust made quite an entrance into the U.S. commercial real estate market when it bought a 49.9% stake in 245 Park Avenue in New York City for $685 million, Nikkei Asia reports. The 45-story commercial tower is next to Grand Central Terminal. The deal comes during the biggest slump in commercial real estate since the meltdown in 2008. Mori Trust sees the downturn as an opportunity, says Toshiyuki Fujii, general manager for the company’s investment operations. “With fewer investors willing to buy property, more offers are coming our way than would otherwise be the case,” Fujii says.
Canadian Bank wants to reduce exposure to US office real estate
Canadian Imperial Bank of Commerce blamed its disappointing last quarter on U.S. office real estate and said it would reduce its focus on the sector, Reuters reports. “It’s a part of the business we’re deemphasizing,’’ says Shawn Beber, head of U.S. operations for Canadian Imperial Bank of Commerce. “And as that transition continues, you’ll see (commercial real estate) wind up being a smaller percentage of the overall U.S. portfolio as our commercial and industrial and our wealth businesses continue to grow.”
Chicago leads large markets in distressed commercial real estate loans
The number of distressed commercial mortgage-backed security loans rose in August with Chicago leading the way, The Real Deal reports. Fifteen of the top 20 markets saw the rate of distressed loans go up. Chicago’s distress rate was 22.7%. Denver was second at 19.1%, followed by Philadelphia at 14.2% and San Francisco at 13.9%. Overall for the top 20 markets the rate was 7.2%
City of Tempe still wants to spruce up 60-year old shopping center
The Tempe City Council recently acknowledged it is committed to working with Guina Affiliated Development and Desert Viking Development to revitalize Danelle Plaza, Signals AZ reports. At the southwest corner of Mill and Southern avenues, Danelle Plaza opened in 1963 and for a time around 1970 housed City Hall and the Tempe Public Library. It has also been home to fraternal lodges, music venues, retail, a fitness center, eateries, bars, a TV repair shop and a skate park. When it first opened, Danelle Plaza had a sort of a condo-ownership plan — each space was bought by a proprietor. That made redevelopment more difficult. “The needs of our community have shifted over time. We want to help rejuvenate Danelle Plaza so that it can provide mixed-income housing, live music, public art, retail, restaurants and community open space,” Mayor Corey Woods says. “We value Danelle Plaza and want to make it stronger. We can make exceptional use of this land while still protecting the incredible culture that makes this corner so special.”
Michael Pollack celebrates Golden anniversary in real estate
Michael Pollack started in the real estate business in San Jose, California at 19. He was ready to retire at 31. That lasted one day. Now Pollack is celebrating 50 years in the business, AZ Big Media reports. He started in single-family housing and moved on to apartments. For a time, he was a minor celebrity in Houston. In Arizona, Pollack has been all about shopping centers, which he rehabs. “Everyone knows that Michael has an extraordinary talent for transforming (less-than-ideal) retail centers and turning them into attractive properties,” says Johnny Basha, whose company had six grocery stores in Pollack retail centers. “What many don’t know about Michael is his commitment to building better communities and helping those less fortunate. As a community leader, he practices social responsibility by investing in people. The world needs more Michael Pollacks.”