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Monthly Archives: July 2013

First repeat-sales index of commercial property prices launched in the UK

London – July 31, 2013 – Real Capital Analytics (RCA) announced today the launch of the RCA/PD UK Commercial Property Price Indices (RCA/PD UK CPPI) — the UK’s first transaction-based indices using repeat-sales regression methodology. The UK indices have been launched in conjunction with Property Data, RCA’s data partner in the United Kingdom.

The RCA/PD UK CPPI are part of a global suite of indices that continue RCA’s history of pioneering advancements in commercial real estate information and analysis. The suite includes the Moody’s/RCA CPPI in the US, first launched in 2007. To complement this national benchmark, RCA recently launched over 200 US market and regional indices. In addition, RCA has executed an agreement with Nikkei Business Publications to launch a transaction-based index for Japan later this year.

Simon Mallinson, RCA Executive Managing Director EMEA said, “At RCA we strive to find new ways of helping our clients’ understanding of market price movements. This new index will allow users to look for leading indicators and understand how sentiment has impacted actual pricing. In fact, the latest data illustrates changes in sentiment are afoot.”

Commercial property prices in the UK were up a modest 0.3% in Q2 and 4.3% over the past year. As prices of office properties in Central London have nearly returned to peak levels, investors have started to put pressure on office prices elsewhere in the UK and on retail properties where these indices are just 70% of peak levels. In Q2, price growth for offices ex-London and for the retail sector was the strongest for 10 quarters. Transactions volumes for offices outside London also rose strongly, while volumes for offices in Central London were up only modestly.

“There has been a growing demand for a UK transaction-based index, driven by the change in investor composition over the last decade. This is a unique opportunity to combine our market leading investment transaction data with the recognised global leader in commercial real estate information,” said Mark Pickering, Director of Property Data.

The initial release of the RCA/PD UK CPPI includes 3 national-level indices focused on the office, retail, and commercial (combined office, industrial, and retail) property types and 2 office indices focused on Central London and the UK excluding London. The indices, which will be published quarterly in the month after quarter’s end, utilize repeat-sales regression methodology, an approach that produces quality-controlled property price indices and is widely acknowledged as the most accurate way to track real estate price movements. To learn more about the RCA/PD UK CPPI or to register to receive quarterly updates, visit at http://www.rcanalytics.com/public/rca_cppi.aspx.

First repeat-sales index of commercial property prices launched in the UK

London – July 31, 2013 – Real Capital Analytics (RCA) announced today the launch of the RCA/PD UK Commercial Property Price Indices (RCA/PD UK CPPI) — the UK’s first transaction-based indices using repeat-sales regression methodology. The UK indices have been launched in conjunction with Property Data, RCA’s data partner in the United Kingdom.

The RCA/PD UK CPPI are part of a global suite of indices that continue RCA’s history of pioneering advancements in commercial real estate information and analysis. The suite includes the Moody’s/RCA CPPI in the US, first launched in 2007. To complement this national benchmark, RCA recently launched over 200 US market and regional indices. In addition, RCA has executed an agreement with Nikkei Business Publications to launch a transaction-based index for Japan later this year.

Simon Mallinson, RCA Executive Managing Director EMEA said, “At RCA we strive to find new ways of helping our clients’ understanding of market price movements. This new index will allow users to look for leading indicators and understand how sentiment has impacted actual pricing. In fact, the latest data illustrates changes in sentiment are afoot.”

Commercial property prices in the UK were up a modest 0.3% in Q2 and 4.3% over the past year. As prices of office properties in Central London have nearly returned to peak levels, investors have started to put pressure on office prices elsewhere in the UK and on retail properties where these indices are just 70% of peak levels. In Q2, price growth for offices ex-London and for the retail sector was the strongest for 10 quarters. Transactions volumes for offices outside London also rose strongly, while volumes for offices in Central London were up only modestly.

“There has been a growing demand for a UK transaction-based index, driven by the change in investor composition over the last decade. This is a unique opportunity to combine our market leading investment transaction data with the recognised global leader in commercial real estate information,” said Mark Pickering, Director of Property Data.

The initial release of the RCA/PD UK CPPI includes 3 national-level indices focused on the office, retail, and commercial (combined office, industrial, and retail) property types and 2 office indices focused on Central London and the UK excluding London. The indices, which will be published quarterly in the month after quarter’s end, utilize repeat-sales regression methodology, an approach that produces quality-controlled property price indices and is widely acknowledged as the most accurate way to track real estate price movements. To learn more about the RCA/PD UK CPPI or to register to receive quarterly updates, visit at http://www.rcanalytics.com/public/rca_cppi.aspx.

China’s State-Owned “Shanghai Greenland Group” Investing $1B in Downtown LA Dev Site

Shanghai Greenland Group, the state-owned company behind what will become China’s third-tallest building, is making its first foray into US real estate with a deal to invest $1 billion in a downtown Los Angeles project.

The company said on Friday it had signed a deal to acquire a stake in a 25,600 square-metre mixed development site from Calstrs, the California teachers’ pension plan. Called Metropolis, the project will feature residential towers, a hotel and an office building. Construction is expected to begin in the next six to nine months.

The move is the latest in a series of deals struck by Chinese developers in the US in recent months. All in all, Chinese investors have poured $1.5bn into US commercial property so far this year, according to data from Real Capital Analytics. The figure – which excludes the Shanghai Greenland deal – already tops the record $1.1bn that was recorded for the whole of 2011.

Cousins Properties Purchasing Texas Office Building for $1.1 Billion

Cousins Properties Inc, an Atlanta-based real estate investment trust, agreed to buy a portfolio of office buildings in Texas for $1.1 billion to expand in a fast-growing commercial-property market.

The company will purchase Greenway Plaza, a 4.4 million-square-foot (409,000-square-meter), 10-building office complex in Houston; and 777 Main Street, a 980,000-square-foot office tower in Fort Worth, Cousins said yesterday in a statement. It plans to sell 60 million shares to help fund the transaction.

The deal represents a large bet by Cousins on Texas real estate, with a price close to the company’s entire market value of $1.28 billion. The REIT has been has been expanding in the state in the past year, including a $102.4 million acquisition in Austin in April and the $232.6 million purchase of Houston towers in February.

Houston has been luring buyers seeking properties with lower costs and higher returns than buildings in other pricier U.S. cities. Sales of offices in the city rose 32 percent to $3.89 billion in 2012, the highest in five years, according to Real Capital Analytics Inc., a global research firm focused exclusively on commercial real estate.

China’s State-Owned “Shanghai Greenland Group” Investing $1B in Downtown LA Dev Site

Shanghai Greenland Group, the state-owned company behind what will become China’s third-tallest building, is making its first foray into US real estate with a deal to invest $1 billion in a downtown Los Angeles project.

The company said on Friday it had signed a deal to acquire a stake in a 25,600 square-metre mixed development site from Calstrs, the California teachers’ pension plan. Called Metropolis, the project will feature residential towers, a hotel and an office building. Construction is expected to begin in the next six to nine months.

The move is the latest in a series of deals struck by Chinese developers in the US in recent months. All in all, Chinese investors have poured $1.5bn into US commercial property so far this year, according to data from Real Capital Analytics. The figure – which excludes the Shanghai Greenland deal – already tops the record $1.1bn that was recorded for the whole of 2011.

Cousins Properties Purchasing Texas Office Building for $1.1 Billion

Cousins Properties Inc, an Atlanta-based real estate investment trust, agreed to buy a portfolio of office buildings in Texas for $1.1 billion to expand in a fast-growing commercial-property market.

The company will purchase Greenway Plaza, a 4.4 million-square-foot (409,000-square-meter), 10-building office complex in Houston; and 777 Main Street, a 980,000-square-foot office tower in Fort Worth, Cousins said yesterday in a statement. It plans to sell 60 million shares to help fund the transaction.

The deal represents a large bet by Cousins on Texas real estate, with a price close to the company’s entire market value of $1.28 billion. The REIT has been has been expanding in the state in the past year, including a $102.4 million acquisition in Austin in April and the $232.6 million purchase of Houston towers in February.

Houston has been luring buyers seeking properties with lower costs and higher returns than buildings in other pricier U.S. cities. Sales of offices in the city rose 32 percent to $3.89 billion in 2012, the highest in five years, according to Real Capital Analytics Inc., a global research firm focused exclusively on commercial real estate.

The Boulder Group Closed Sale of AutoZone in Mississippi for $1,075,000

Northbrook, IL— The Boulder Group, a net leased investment brokerage firm specializing in single-tenant assets, has completed the sale of a single-tenant AutoZone ground lease located at 7322 Hacks Cross Road in Olive Branch, Mississippi for $1,075,000.

AutoZone is the sole occupant of the 7,008 square foot building located on a 40,843 square foot parcel. Olive Branch is located 23 miles south of downtown Memphis. The property was built in 2004 and is located one-half mile from Mississippi State Highway 302, which experiences traffic volumes in excess of 20,000 vehicles per day. Located in close proximity to the property are The Whispering Woods Hotel and Conference Center, the newest hotel and event space in northeastern Mississippi, and a recently constructed Walgreens.

The property is ground leased to AutoZone on a triple-net basis with approximately seven years remaining. The lease has a 10% rental escalation in the primary term and in each renewal option period. AutoZone is a publicly traded company on the New York Stock Exchange (AZO) with a market capitalization of $15 billion.

About The Boulder Group
The Boulder Group is a boutique investment real estate service firm specializing in net lease properties. Founded in 1997, the firm has arranged the acquisition and disposition of more than $1.6 billion of net lease real estate transactions through several real estate cycles. In 2012, the firm was ranked in the top 10 companies in the nation for single-tenant retail transactions by Real Capital Analytics.

Hudson’s Bay Buys Saks Inc for $2.4 Billion

Hudson’s Bay Co. (HBC), a middle-market Canadian department store chain with a similar assortment to Macy’s, has agreed to pay $2.4 billion to acquire Saks Inc. (SKS), one of America’s most prestigious luxury retailers.

Hudson’s Bay, founded in the 17th century as a fur trading company, will pay $16 a share in cash, a 30 percent premium to New York-based Saks’s closing price on May 20, the day before media reports emerged that Saks was exploring alternatives, according to a statement today. The transaction, which brings together the Hudson’s Bay, Lord & Taylor and Saks Fifth Avenue brands, creates a company that will operate 320 stores.

The audacious move is a coup for Hudson’s Bay Chief Executive Officer Richard Baker, 48, who over the past seven years has acquired and refreshed retail chains while leveraging their real estate.

Hudson’s Bay plans to expand Saks Fifth Avenue into Canada and continue to roll out Saks’s outlets across the U.S., it said. It will evaluate creating a real estate investment trust with the combined portfolio of the three main retail nameplates it will now own, it said.

A retail REIT “makes a lot of sense,” said Dan Fasulo, managing director at Real Capital Analytics Inc. a global research firm that exclusively tracks commercial-property sales. “It’s a way to recognize the underlying value of those assets, which are significant. Saks is on one of the best corners and in some of the more premier markets in the country.”

Hudson’s Bay Buys Saks Inc for $2.4 Billion

Hudson’s Bay Co. (HBC), a middle-market Canadian department store chain with a similar assortment to Macy’s, has agreed to pay $2.4 billion to acquire Saks Inc. (SKS), one of America’s most prestigious luxury retailers.

Hudson’s Bay, founded in the 17th century as a fur trading company, will pay $16 a share in cash, a 30 percent premium to New York-based Saks’s closing price on May 20, the day before media reports emerged that Saks was exploring alternatives, according to a statement today. The transaction, which brings together the Hudson’s Bay, Lord & Taylor and Saks Fifth Avenue brands, creates a company that will operate 320 stores.

The audacious move is a coup for Hudson’s Bay Chief Executive Officer Richard Baker, 48, who over the past seven years has acquired and refreshed retail chains while leveraging their real estate.

Hudson’s Bay plans to expand Saks Fifth Avenue into Canada and continue to roll out Saks’s outlets across the U.S., it said. It will evaluate creating a real estate investment trust with the combined portfolio of the three main retail nameplates it will now own, it said.

A retail REIT “makes a lot of sense,” said Dan Fasulo, managing director at Real Capital Analytics Inc. a global research firm that exclusively tracks commercial-property sales. “It’s a way to recognize the underlying value of those assets, which are significant. Saks is on one of the best corners and in some of the more premier markets in the country.”

The Boulder Group Closed Sale of AutoZone in Mississippi for $1,075,000

Northbrook, IL— The Boulder Group, a net leased investment brokerage firm specializing in single-tenant assets, has completed the sale of a single-tenant AutoZone ground lease located at 7322 Hacks Cross Road in Olive Branch, Mississippi for $1,075,000.

AutoZone is the sole occupant of the 7,008 square foot building located on a 40,843 square foot parcel. Olive Branch is located 23 miles south of downtown Memphis. The property was built in 2004 and is located one-half mile from Mississippi State Highway 302, which experiences traffic volumes in excess of 20,000 vehicles per day. Located in close proximity to the property are The Whispering Woods Hotel and Conference Center, the newest hotel and event space in northeastern Mississippi, and a recently constructed Walgreens.

The property is ground leased to AutoZone on a triple-net basis with approximately seven years remaining. The lease has a 10% rental escalation in the primary term and in each renewal option period. AutoZone is a publicly traded company on the New York Stock Exchange (AZO) with a market capitalization of $15 billion.

About The Boulder Group
The Boulder Group is a boutique investment real estate service firm specializing in net lease properties. Founded in 1997, the firm has arranged the acquisition and disposition of more than $1.6 billion of net lease real estate transactions through several real estate cycles. In 2012, the firm was ranked in the top 10 companies in the nation for single-tenant retail transactions by Real Capital Analytics.

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