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Cousins' Orlando, Fla., assets up for sale; wildfires threaten Calif. homes

Commercial real estate

* Cousins Properties Inc. has enlisted Eastdil Secured to market its Orlando, Fla., office portfolio of more than one million square feet, the Orlando Business Journal reported, citing an Eastdil representative.

The 28-story Bank of America Center spans 421,069 square feet and is 89.2% leased, and the 19-story, 355,783-square-foot One Orlando Centre is 80.5% leased, the report said, citing JLL. The 260,751-square-foot, 18-story Citrus Center is 96% leased, the report noted, citing marketing materials.

* SL Green Realty Corp. and Jeff Sutton received a $225 million leasehold mortgage from Aareal Bank to refinance the retail space at 650 Fifth Ave. in Manhattan, N.Y., The Real Deal reported. The refinancing deal replaces an earlier $97 million mortgage loan by the German lender from October 2014 and includes a $128 million mortgage gap, the report noted.

SL Green and Sutton acquired the retail leasehold in 2013. Nike signed on for 60,000 square feet in December 2016 in what was said to be one of the priciest retail leases in New York City.

* Empire State Realty Trust Inc. leased 85,400 square feet across four floors at its property at 250 W. 57th St. in Manhattan to the American Society of Composers, Authors and Publishers, or ASCAP, the New York Post reported. ASCAP is moving from 1900 Broadway, a few blocks away, the report noted.

* AB & Sons and Sioni Group, the companies of Isaac Chetrit and Ray Yadidi, respectively, are looking to sell their development site along Sixth Avenue in Midtown Manhattan's Garment District, where a mixed-use skyscraper of at least 70 stories is planned, The Real Deal reported, citing unnamed sources.

Sources told The Real Deal that the companies have received several offers of more than $200 million, with at least one offer in the $225 million range. The assemblage spans nearly a full block between West 36th and 37th streets and offers 375,000 buildable square feet.

The companies are primarily investors and have never attempted a ground-up project of this scale, the report noted. Demolition work is already underway at the site, and construction plans are being drawn, but the companies are considering forgoing the skyscraper plans and "quietly shopping" the site, the report added, citing the sources.

* Meanwhile, Bloomberg News featured a report on a planned 67-story condominium tower project on Midtown Manhattan's East 58th Street where developer Gamma Real Estate is racing against the clock to finish foundation work before a potential rezoning slashes the planned 799-foot height by about half.

The East River 50s Alliance is pushing for the rezoning, and a public hearing is scheduled for Oct. 18 with a possible approval by the city council in November, the news outlet said, citing Ben Kallos, a councilman who is one of the applicants seeking rezoning.

Gamma has already scaled back the planned height of Sutton 58 from almost 1,000 feet, and company president Jonathan Kalikow told Bloomberg that a zoning change would lead to work stoppage and monthslong delays, aside from causing a "chilling effect" on the city's real estate developers.

* Apple Inc. is in talks to lease the entire 85,000-square-foot creative office development at 5500 W. Jefferson Blvd. near Culver City, Calif., The Real Deal reported, citing unnamed sources. Hackman Capital Partners is converting a former warehouse on the site into creative office space, which is expected to be completed in January 2018, the report added, citing Loopnet.

The space is intended for Apple's original-content division and would be used for production, according to the report.

* As retail center landlords cast a wider net for prospective tenants, especially in weaker markets amid a retail consolidation, some are leasing their spaces to churches and other houses of worship, according to a report from The Wall Street Journal. Property owners had been turning to the likes of theaters, restaurants, medical and wellness clinics, and bowling alleys to fill up space and are now turning to churches as well in markets with higher vacancies.

According to the Journal's analysis of August 2017 data from the Directory of Major Malls that tracks roughly 8,200 retail centers in the U.S., at least 111 malls and open-air centers had churches as occupants, with some having two or more.

* BMC Investments sold its 12-story Steele Creek apartment complex in Cherry Creek North, Denver, to an unnamed buyer for $141.5 million, the Denver Business Journal reported. The 218-unit asset sold for $649,082 per unit, marking a historically high per-unit price in the city, according to the report.

* According to data from Green Street Advisors, average self-storage rents in the third quarter were up 0.9% year over year, partly due to stronger demand from regions impacted by recent hurricanes, the Journal reported. The publication noted that the increased demand has helped somewhat offset the impact of a construction boom that had weighed on rents in many markets across the U.S., especially Houston.

* Hadley Properties locked down $165 million to refinance the 1.3 million-square-foot Airport Industrial Park leasehold near Honolulu International Airport, Pacific Business News reported.

Airport Industrial Park is the largest office and warehouse development in Hawaii and is 99% occupied by tenants including AT&T Corp., the city and county of Honolulu, and the state of Hawaii, among others. Hawaiian Airlines also bases its headquarters in the industrial park.

After the bell

* Sears Canada Inc. plans to liquidate all its remaining stores, the department store chain announced Oct. 10, following a last-ditch attempt by Executive Director Brandon Stranzl to save the company. The liquidation would lead to the closure of 130 stores and cause the loss of 12,000 jobs, Reuters reported.

* Agellan Commercial Real Estate Investment Trust set the date of its annual and special unit holder meeting for April 17, 2018, contrary to Sandpiper Real Estate Fund LP's urgent call for a second meeting to vote on the proposed internalization and the shareholder activist's trustee nominees to the REIT's board.

* KKR wrapped up its $1.1 billion fund focused on purchasing junior tranches of newly issued commercial mortgage-backed securities.


* Ongoing wildfires in northern California are threatening more than 172,000 homes in the Napa and Santa Rosa metropolitan areas that would have an estimated rebuilding cost of $65 billion, the Journal reported, citing CoreLogic Inc. The report noted that roughly 11,000 homes worth a combined $5 billion are at significant risk of damage, with the rest of the homes facing moderate and low risks.

The Journal noted that the reconstruction cost estimate reflects the cost to completely rebuild the home, and that the actual cost to rebuild could be lower.

The day ahead

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

In Asia, the Hang Seng fell 0.36% to 28,389.57, and the Nikkei 225 was up 0.28% to 20,881.27.

In Europe, as of midday, the FTSE 100 was nearly unchanged at 7,538.05, and the Euronext 100 had grown 0.02% to 1,046.13.

On the macro front

Mortgage applications decreased 2.1% on a seasonally adjusted basis in the week ended Oct. 6, the Mortgage Bankers Association reported, citing data from its weekly mortgage applications survey.

The Bank Reserve Settlement report, the JOLTS report and the FOMC minutes are also due out today.

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