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Real Estate News & Analysis: May Edition


Boston tower may sell for $800M; activist fund exits Macerich

Commercial real estate

* UBS Realty Advisors LLC is looking to sell the 40-story Exchange Place tower in downtown Boston, with the asset expected to fetch more than $800 million, the Boston Business Journal reported, citing a person with knowledge of the deal. The 53 State St. property was acquired by UBS Realty in 2011 for $610 million.

The Boston Globe, software company Dataxu Inc. and law firm Rubin and Rudman LLP all house their headquarters in the building.

* Activist hedge fund Third Point exited its position in Macerich Co. during the first quarter, Bloomberg News reported, citing a regulatory filing. The news follows Macerich's announcement in April that CEO Arthur Coppola would step down at the end of 2018. The fund has also added a position in Wynn Resorts Ltd., the newswire added.

* The 218,000-square-foot Number One Broadway building in Lower Manhattan, N.Y., is being acquired by Midtown Equities for $140 million with the buyer likely to carry out a renovation, the New York Post reported, citing unnamed sources. The asset is being sold by a Swiss trust that has owned the building since 2000, the report noted.

The publication noted that the landmarked office property has 30,000 square feet of additional air rights and may be converted to luxury residential use. The building is slated to become vacant with law firm Kenyon & Kenyon, its largest tenant, moving elsewhere and a Citibank lease ending in 2019.

* Citing data from Real Capital Analytics, The Wall Street Journal reported that multifamily sales in California increased 22% year over year in the first quarter, while prices rose 8%, signifying robust demand. The report pointed toward uncertainty surrounding a pending measure to repeal the Costa Hawkins state legislation that prevents cities and towns from imposing rent control on buildings built after 1995 and on single-family rentals.

* The WSJ also reported that underperforming real estate investment trusts over the past two years might be "turning a corner." The FTSE Nareit All Equity REITS index logged a total return of 3.71% in March, versus a 2.5% decline for the S&P 500 index for the same period, according to the report. In April, the REIT index logged a total return of 0.52%, compared to the S&P 500's 0.4%.

Investors are favoring the industrial and multifamily sectors in particular due to high demand and tight supply, the report added.

* Real estate investment in the Bronx borough of New York City dropped 18% year over year to roughly $2.7 billion in 2017, but still represented the second-highest figure since 2009, The Real Deal reported, citing Bronx Borough President Ruben Diaz Jr.'s annual development report. Residential projects accounted for roughly $2.3 billion of the total.

The borough's real estate investments totaled a record $3.3 billion in 2016. The total square footage of sales of 16.3 million in 2017, however, exceeded 2016's 14.2 million square feet, according to the report.

* Development group Unified Capital Partners LLC is planning a $66.3 million project on a site spanning "just under a quarter acre" on Camelback Road and 17th Avenue in Phoenix, the Phoenix Business Journal reported. The developer, which is offering $110,000 for the city-owned site following a request for proposals, plans to build an eight-story apartment building with 330 units and commercial space.

Housing

* Residential sales in Miami-Dade County dropped 6.5% year over year in the first quarter, while the median prices of single-family homes and condominiums rose 5.9% and 4.5%, respectively, year over year to $337,000 and $230,000, The Real Deal reported, citing Florida Realtors and the Miami Association of Realtors.

Closings of luxury home sales, or sales priced at $1 million or higher, in Miami-Dade jumped 12.3% year over year in the first quarter.

The day ahead

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

In Asia, the Hang Seng fell 0.13% to 31,110.20, and the Nikkei 225 was down 0.44% at 22,717.23.

In Europe, as of midday, the FTSE 100 was up 0.13% at 7,732.64, and the Euronext 100 had fallen 0.09% to 1,070.51.

On the macro front

The MBA mortgage applications report, the Housing Starts report, the Industrial Production report, the Atlanta Fed's business inflation expectations survey and the EIA petroleum status report are due out today.

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Joyce Guevarra contributed to this article.