Welcome to the 8th edition of CompStak Courier, your one-stop shop for interesting CRE news for the week.
NEW YORK CITY: SL Green Closes $1.5B for One Vanderbilt
SL Green closed on $1.5B in construction financing for One Vanderbilt, almost guaranteeing the 1,401-foot-tall Midtown mixed-use tower’s rise. This would be the tallest building in Midtown and the tallest in Manhattan behind One World Trade. Wells Fargo led the financing as the administrative agent with BNY Mellon, JP Morgan Chase Bank, TD Bank, and Bank of China serving as syndication agents and Landesbank Baden-Württemberg as the documentation agent. So far, SL Green has preleased to TD Bank as the anchor retail tenant. According to CompStak, Class A office leases in the surrounding area are going for $63.40 PSF so we can expect SL Green to fetch at least that when they start to lease up the building, which is set be completed by 2020.
DC METRO: LHL Realty Finds Buyer for Patrick Henry Building
LHL Realty sold the Patrick Henry Building to an undisclosed buyer this week. This comes just a week after StonebridgeCarras sold it to MetLife and Norges Bank for $422M. The 520K SQFT building was renovated in 1997 and its only tenant is the US Department of Justice. The DOJ is paying an average starting rent of $49.45, but is planning to vacate the space at the end of 2018. The purchase is clearly one of value-add as the average starting rent for the comparable set and submarket are $61.15 and $52.54 respectively. The new buyer can expect increased rental revenue with the DOJ’s exit.
CHICAGO: CIM Group Adds to Chicago Portfolio
CIM Group and Golub and Co. purchased Chicago’s iconic Tribune building for a reported $205M with an additional $35M contingent upon certain conditions. The Tribune Tower, built in 1925, is zoned for all property types, leading the buyers to explore various redevelopment options for the property. According to CompStak, its current tenants include CNN/TBS, Dom & Tom, and Howells and Hood. Most notably, the restaurant is paying $50 PSF for the almost 14K SQFT space that was completely renovated.
LOS ANGELES: Majestic Asset Management buys Thousand Oaks’ Largest Industrial Building
Majestic Asset Management purchased Thousand Oak’s largest industrial building for $37M, paying about $107 per square foot for the 347,119-square-foot building at 1461-1475 Lawrence Drive. The building is 100% leased with tenants, including Custom Sensors and Technologies and MB2 Raceways. The average starting rent for the building is $0.71 PSF and the average effective rent of $0.66 PSF according to CompStak.
SAN FRANCISCO-BAY AREA: Lowe Enterprises Investors Buys 500 Ygnacio in Walnut Creek
Lowes Enterprises purchased 500 Ygnacio in Walnut Creek from Pacific Eagle Real Estate Fund. Lowes plans to make capital improvements to the interior and exterior of the building as well as turn tenant spaces into turnkey spec suites. Currently, tenants at 500 Ygnacio average $3.04 PSF in starting rent. This is slightly below the Walnut Creek submarket’s average starting rent of $3.19 PSF.
BOSTON: The Predictive Index’s Cool New Space
Predictive Index recently moved to 101 Station Drive at University Station in Westwood. PI enlisted a design firm to build out a collaborative open concept office space for the fast growing firm, citing the need to continue attracting and retaining talent. The company now occupies over 21K SQFT and, according to CompStak, is paying $29 PSF for the space. Employees now have access to expanses of whiteboards and glass brainstorming walls as well as a concrete floors to get around the office on skateboards and scooters.