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Real Estate News & Analysis: May Edition


CIM Commercial targets $690M sale proceeds; Telemundo's Fla. HQ fetches $239M

Commercial real estate

* CIM Commercial Trust is hoping to reap about $690 million from the sale of certain assets after receiving approval from its majority stockholder for the disposals. The properties included in the sale are 260 Townsend Street, 1333 Broadway, 1901 Harrison St., 1 Kaiser Plaza, 2100 Franklin St., 2101 Webster St., 2353 Webster St., 830 First St. and 999 N. Capitol St.

* Three AVR Realty Co. LLC-controlled companies bought Spanish TV network Telemundo's new headquarters in northwest Miami-Dade County, Fla., for $239.1 million, The Real Deal reported, citing property records. TM Miami FL Landlord LLC, which is controlled by SunTrust Banks Inc.'s SunTrust Equity Funding LLC, sold the 476,000-square-foot, two-building campus at 1 Telemundo Way, within the 478-acre Beacon Lakes industrial park. AVR Realty took over an approximately $185 million loan from Wells Fargo as part of the deal.

* Ceruzzi Properties Inc. and Madison Equities LLC are in late-stage talks to team up on a $500 million development at 520 Fifth Ave. in New York City, where Ceruzzi and SMI USA, have been planning to build a condominium project for the past few years, The Real Deal reported.

Earlier in 2018, Ceruzzi and SMI USA were in talks with a number of potential development partners for the project — namely Extell Development Co., Zeckendorf Development and HFZ Capital Group LLC — but the negotiations broke down after Ceruzzi insisted on holding onto the development fees, the news outlet said, citing unnamed sources. In exchange for a portion of the fees, Madison will obtain a $200 million loan, for which it has a term sheet out with Och-Ziff Capital Management, according to the report.

Madison also aims to raise about half of the additional $60 million in equity that the project requires, while SMI USA will work to secure the remaining $30 million. Ceruzzi and SMI paid Thor Equities LLC $275 million for the site in 2015. The partners' previous plans for the site included three levels of retail space and 180,000 square feet of luxury condos that could fetch more than $1 billion.

* Biotech landlord Alexandria Real Estate Equities Inc. filed a lawsuit against Runlabs, a startup launched by Steven Marcus, the son of the company's executive chairman Joel Marcus, alleging that the younger Marcus is using Alexandria's name and trademarks to promote his business and raise an intended €50 million for the creation of the "first and only flexible urban lab platform" for life science companies, the San Francisco Business Times reported, citing the lawsuit filed in the U.S. District Court in San Francisco.

The publication added that the company aims to open flexible lab and office facilities in Paris in 2019. Runlabs hopes to have seven locations in 2020 and 20 locations by the end of 2022.

* Vancouver, Canada-based Onni Group of Cos. Ltd. obtained a construction loan worth $125 million from Wells Fargo that will be used for the second phase of its Old Town Park rental complex at 202 W. Hill St. in Old Town, Chicago, The Real Deal reported, citing property records.

The first phase of the project comprises a 39-story, 428-unit property that will join a 32-story, 405-unit building developed by Onni at 1140 N. Wells St. The towers will form part of a three-building complex, of which the third building will rise 39 stories.

* The development of a 1.27-million-square-foot eldercare facility is proposed on a site of defense contractor Northrop Grumman Corp. in Los Angeles' Woodland Hills neighborhood, The Real Deal reported, citing a filing with the city. It is not clear whether the company is leading the project or is partnering with an outside firm, according to the news outlet, which added that Northrop's real estate director, A. J. Paz, signed off on paperwork filed with the city describing their intent to develop the complex.

Overall, the site covers about 59 acres at 21240 W. Burbank Blvd. The project would deliver 566 independent living units on a 17.6-acre portion of the site. It would also feature restaurants, retail space and 129 guest rooms that could be a hotel. Northrop will retain its Mission Systems division facility on the remaining 41 acres.

The day ahead

Early morning futures indicators pointed to a higher opening for the U.S. market.

In Asia, the Hang Seng fell 1.05% to 25,814.25, and the Nikkei 225 dropped 1.82% to 21,115.45.

In Europe as of midday, the FTSE was down 0.39% to 6,746.86, and the Euronext 100 fell 0.30% to 929.32.

On the macro front

The housing starts report and the Redbook index for retail sales are due out today.

Click here to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

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