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Hope everyone out West is staying safe. Governor Newsom passed on executive order aimed at streamlining the permitting process for reconstruction on Monday, data center demand looks to only continue to ramp up with AI, CMBS delinquency rises in December with Office and Multifamily leading the charge, and PPI comes in below expectations

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Capital Markets

Headlines

• Data Center Demand to Continue Outpacing Supply Growth

  A new report by JLL highlights the growing demand for Data Centers due to the rise in AI and the issues surrounding power generations which limit the rate of new development

  Projected Global Data Center Capacity

  

• California Governor Signs Executive Order Waiving Permitting and Review Requirements for Reconstruction

  A new executive order by Gov. Newsom will Suspend CEQA review and California Coastal Act permitting for reconstruction of properties and direct agencies to identify additional permitting requirements that can be suspended or streamlined

• CMBS Delinquency Rate Rises to 10.6% in December

  The CRED iQ overall distress rate added 60 basis points, logging its fourth straight record high of 10.6%. Office distress rose to 17.2% and and multifamily to 12.5%

  

• Wholesale Inflation (PPI) Rises by Less Than Expected in December

  On Tuesday, the Bureau of Labor Statistics showed the producer price index (PPI) rose 3.3% from the year prior, up from 3% in November but below the 3.5% increase economists had projected

Deals Deals Deals

Sales

• Senior Housing: AEW Capital Management acquired a three-building portfolio of senior housing communities in Florida from Titan Development. The portfolio consists of 416 units across independent living, assisted living, and memory care

• Office: A partnership by SynerMark Properties Inc acquired a 180K SF office asset in San Antonio, TX from KBS Realty Advisors

• Retail: Bridge33 Capital acquired Shops at CenterPoint, a 445K SF shopping center in Grand Rapids, MI. A JV between DRA Advisors and Pine Tree sold the asset for $70mm

• Office: New England Investment Properties acquires 121 W Trade St, a 31-story Charlotte, NC high-rise, for $32mm. A local credit union provided a $18mm 5-year 6.625% interest loan with a 25-year amortization period

Debt

• Life Sciences: A JV between Bain Capital Real Estate and Phase 3 Real Estate Partners Inc., secured $484mm to refinance GENESIS Marina, a three-building life science complex totaling 567K SF in Brisbane, CA, from Brookfield’s Real Estate Credit group

• Multifamily: Sunroad Enterprises secured a $188mm five-year, fixed-rate loan for a 442-unit community in San Diego, CA from KKR

• Multifamily: Adept Urban Development secures $107mm in construction financing for a 384-unit multifamily development in Ontario, CA, Affinius Capital and Bank OZK provided the debt

• Self Storage: Tulfra Realty Company secures a construction loan to build a 104K SF, 795-climate controlled unit self-storage facility in Jersey City, NJ. The property will be managed by Public Storage 

• Office: Brookdale Group secures a $30mm loan to refi a 170K SF office in Plantation, FL. The asset was acquired for $38mm in 2023

Developments

• Multifamily: Arosa Developers seeking to build a 54-story, 607-unit multifamily tower in Fort Lauderdale, FL

Distress

• Office: Ardent Cos. defaults on a $331mm loan secured by Piedmont Center, a 2.2mm SF, 14-building office campus in Atlanta, GA. Morgan Stanley has filed to foreclose on the loan on February 4th

• Multifamily: Tides Equities has handed back the keys to a 256-unit apartment building in Phoenix, AZ to Starwood Property Trust

Leasing

• Office: KnitWell Group signs a 246K SF 20-year lease a BXP’s 7 Times Square in New York

Meme Summary

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