Happy Friday Afternoon!

Blackstone and Digital Realty establish a JV to develop four hyperscale data center campuses across Frankfurt, Paris, and Northern Virginia. SoftBank tries to pull a sneaky move on WeWork landlords. The Chicago Bears continue looking for a new home. A vacant unit law allow tenants to report maintenance issues on vacant units passes in New York. Gas prices keep dropping, unemployment drops, and layoffs hit Stellantis employees.

Have a safe weekend and Happy Hanukkah everyone!

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Merch Spotlight

Capital Markets

Market News

• Jobs Report Beats Expectations, Unemployment Rate Falls

  Data released by the Labor Department revealed in November 199,000 jobs were added, above the 180,000 jobs economists predicted. The Unemployment rate fell to 3.7%, below the 3.9% predicted

• Gas Prices Hit Lowest Levels in 2023

  Gas prices hit their lowest levels due to weaker demand and increased production from refineries. The national average for regular gas was $3.20 per gallon on Thursday, the lowest since January 1st. Government data reveals stockpiles rose by 5mm barrels last week vs, the estimates of 1.3mm. The cost of diesel was down to $4.16 per gallon, down from $4.39 a month ago

• Stellantis to Cut Shifts and Layoff Workers

  Stellantis plans to temporarily cut a shift at its Detroit Assembly Complex – Mack plant, which may impact 2,455 workers. It also plans to make changes to its Toledo Assembly Complex where 1,225 workers might be impacted. The job losses could come as early as Feb 5

• Dow Futures Fall As Treasury Yields Jump After Jobs Report

  The unexpected drop in unemployment numbers caused the 10-year treasury to jump early Friday morning leading to a drop in futures for all three major indices ahead of market opening

CRE Headlines

• Landlords Push Back on WeWork’s Bankruptcy Proposal Benefiting SoftBank

  Office landlords asked a judge to reject WeWork’s motion for debtor-in-possession financing. The proposal would allow SoftBank Groups’s Vision Fund to use letters of credit for WeWork’s leases as funds during the Chapter 11 restructuring. Attorney’s representing the landlord group argue the largest issue with the proposal is the lack of new funds from SoftBank while seeking greater control of the company

• Chicago Bears Looking at Soldier Field Parking Lot for New Stadium

  The Chicago Bears have had a surveyor examine the south parking lot of the current stadium as an option for a new stadium. The move would potentially keep the stadium in the lakefront vs. having it relocate to Arlington Heights, a suburb outside of Chicago. The NFL team continues to explore options, with its lease on Soldier Field not expiring until 2033

• Vacant Unit Bill Passes in NYC

  The City Council passed Intro 195 on Wednesday which allows tenants to report maintenance code issues to the Housing Preservation and Development (HPD) department via 311, and have city officials inspect vacant units when they may pose a hazard to those in nearby units. A spokesperson for Mayor Eric Adams did not immediately respond to an inquiry about whether the mayor intends to sign the bill, which passed 39 to 8

• Northern California Power Constraints Stalling Data Center Development

  Data center developers looking for utilities to provide them power in Silicon Valley say they are being told it could take as long as a decade. With tenants willing to pay higher rates to be closer to Silicon Valley developers are keen on getting power to their developments and pushing into surrounding markets in an attempt to build faster. The utility companies blame California’s lengthy permitting process, as building new high-tension distribution lines through existing neighborhoods requires permitting

Deals Deals Deals

Sales

• Multifamily: Goldrich Kest acquires Novel Midtown, a 340-unit apartment high-rise for $151mm from Crescent Communities in Atlanta, GA

• Multifamily: The Connor Group acquires Carmel Center, a 322-unit multifamily asset in Carmel, IN for $82mm from NTS Development 

• Multifamily: A 312-unit rent-stabilized multifamily asset in New York’s Queens traded for $48mm between private investors

• Retail: Alo Yoga acquires its 5k sf Miami Design District store for $22mm

• Multifamily: Infinity BH acquires Buena Vista, a 240-unit multifamily asset in Tampa, FL from Westside Capital. The asset previously traded for $21mm in 2019

• Student Housing: Tailwind Group acquires a 670-bed, 213-bed student housing asset near University of Arkansas Campus in Fayetteville, AR from Fountain Residential Partners

Debt

• Life Sciences: Oxford Properties secured a $136mm loan from Otera Capital for a build-to-suit development in Carlsbad, CA. The company first acquired the 18-acre site from Ionis Pharmaceuticals via a $258mm sale-leaseback in November

• Multifamily: Enterprise Community Development secured a $123mm in funding from federal and local sources plus an additional $66mm in construction-only funding for Edgewood Commons V, a 151-unit affordable housing asset in Northeast Washington, D.C.

• Multifamily: Carthage Real Estate Advisors and Rester Management have secured a $100mm bridge loan from Dwight Mortgage Trust to refinance a 19-story multifamily asset in New York’s West Harlem

• Multifamily: CALCAP Advisors secures a fixed-rate, five-year, $11mm Fannie Mae Loan for a 127-unit garden-style community in Phoenix, AZ

Developments

• Multifamily: JSC Realty acquired 540 Atlantic Ave in Brooklyn, NY for $39mm from DMA Associates. The development site currently has a five-story office but allows for a 154-unit mixed-use development

• Multifamily: Trademark Property Co. to develop a 321-unit multifamily project in Fort Worth, TX. First United provided a $61mm construction loan. Construction is set to begin next year, with completion expected in 2026

• Industrial: Hunt Midwest delivered a 251k sf spec industrial asset in Ocala, FL. The 32-foot clear height asset is divisible from 50k sf

• Senior Housing: Chelsea Senior Living and Capitol Seniors Housing open an 85-unit senior housing community in Washington Township, NJ after breaking ground in 2021

Capital Raising

• Data Centers: Blackstone and Digital Realty establish a JV to develop four hyperscale data center campuses across Frankfurt, Paris, and Northern Virginia. The developments are expected to support 500MW of total load across 10 assets. Blackstone will own an 80% interest in the JV and Digital Realty the remaining 20%. Total development cost for the portfolio is expected to be $7bn

• Medical Office: GI Partners and former execs from Healthcare Trust of America announce a partnership, UDLR Healthcare, to invest in medical outpatient buildings across key markets An identified initial property investment is expected to close in December 2023

• Industrial: Quilvest Capital Partners and Axis IOS have launched a JV to acquire and operate a $500mm portfolio of industrial outdoor storage properties across the U.S.

Meme Summary

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