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Prologis JV expands China venture to $3.5B; Foreign interest in US CRE falls

A healthy U.S.-China partnership

* A joint venture of industrial real estate investment trust Prologis Inc. and Hip China Logistics Investments Ltd. increased its capacity to develop logistics properties in China to roughly $3.5 billion by committing a further $882 million to the initiative. The REIT also launched the open-ended Prologis China Core Logistics Fund LP with 3.1 billion Chinese yuan in capital commitments.

Bucking the trend

* Cross-border investment activity in U.S. commercial properties saw a steep decline, with the third-quarter purchases of the main property types totaling about $10.5 billion, compared to $29.2 billion of sales, according to Real Capital Analytics Inc. The report highlighted that cross-border investors, including China, have lately become net sellers in the U.S. after several years of gains in acquisitions.

Internal affairs

* Hedge fund manager Pershing Square Capital Management LP disclosed a beneficial ownership of 6,384,239 shares of the common stock of Howard Hughes Corp., which translates to a 14.8% stake, based on the real estate company's outstanding 43,211,546 shares, as of Oct. 31.

* Regional mall REIT CBL Properties moved to suspend all future dividends to preserve free cash flow, saying heightened retailer bankruptcies, restructurings and store closures in 2019 are likely to lead to a drop in its net operating income in 2020.

New aims

* Single-family REIT Front Yard Residential Corp. is in advanced discussions with Amherst Holdings LLC for a potential sale, Bloomberg News reported, citing unnamed sources. Front Yard, which has a market value of about $691 million, earlier put itself on the market after launching a strategic review as part of a settlement with an activist investor.

* Canadian homebuilder Bordeaux Properties Inc. agreed to acquire developer NewNorth Projects Ltd. for 13 Canadian cents per share in cash. The deal is subject to approval of at least 66.67% of NewNorth shareholders and is expected to close in January 2020.

Property world

* Multifamily landlord UDR Inc. completed its $1.76 billion asset-swap joint venture deal with MetLife Investment Management. The deal saw UDR purchase the roughly 50% interest it did not previously own in 10 joint venture operating communities totaling 3,321 apartment homes, one community under development and four development land sites, valued at $1.1 billion, or $557 million at the REIT's share. UDR also sold its roughly 50% ownership stake in five joint venture communities totaling 1,001 apartment homes, valued at $645 million, or $323 million at UDR's share, to MetLife.

* Single-tenant REIT Realty Income Corp. paid about $1.04 billion to CIM Real Estate Finance Trust Inc. for 411 properties, completing the first tranche of a $1.25 billion deal between the parties. The deal involves certain units of CIM, formerly known as Cole Credit Property Trust IV Inc., selling a portfolio of 454 single-tenant properties to the REIT.

* Orda Management Corp. plans to sell its 675,000-square-foot office property at 225 Park Ave. S. in Manhattan, N.Y., for up to $800 million, The Real Deal reported, citing unnamed sources.

* Broadcom Inc. is selling a 10-building office/research complex spanning 707,000 square feet in Mountain View, Calif., that could attract bids at a property valuation of over $700 million, Real Estate Alert reported.

* A joint venture of Vornado Realty Trust closed the $800 million refinancing of the 600,000-square-foot office and retail tower at 650 Madison Ave. in Manhattan, N.Y. The office REIT owns a 20.1% stake in the joint venture.

* Also in Manhattan, ground lease-focused REIT Safehold Inc. closed a roughly $620 million ground lease at the under-construction 425 Park Ave. office building.

* Columbia Property Trust Inc. outlined several recent property deals, including its purchase of a 17-story office tower spanning 272,000 square feet at 201 California St. in San Francisco's Financial District for $239 million, excluding closing costs, from Beacon Capital Partners LLC.

* Israel's Gazit-Globe Ltd. agreed to buy the 570,000-square-foot York Mills Centre office complex in midtown Toronto for approximately C$250 million via a joint venture, with closing expected by the end of 2019.

New York cares

* New York Gov. Andrew Cuomo signed legislation that prevents landlords from creating unsafe, disruptive or uninhabitable conditions to force rent-regulated tenants out of their homes. The previous law only offered protections to tenants who could show physical injury, and it did not factor in the conditions caused by the landlord.

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