Good Morning!

Capital raising continues to be in full swing. The GSA pulls its list of properties for sale, D.C. council pushing for tax relief on office-to-residential conversions, investors start to pull away from residential investments in Florida, and buildout costs for office are on the rise

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Capital Markets

Headlines

• D.C. Council Seeking Office-To-Residential Tax Relief

  New proposed legislation, unanimously approved by the D.C. Council on Tuesday allows for office-to-residential conversions to be designated as a residential once the city has issued a permit for the project, rather than at completion.

• GSA Deletes List Of Federally Owned Properties For Sale

  After announcing 440 properties to be marketed for sale, the GSA website removed the list showing the assets. Fortunately, a few websites saved the list and have created maps and lists showing the locations of the federal buildings. No reason was given as to why the list was removed following the announcement

• Investor Share Of Home Purchases Drops In Florida

  A report from Redfin, showed investor market share fell in Q4 in Florida. Orlando, Miami, and West Palm Beach saw a 27.5%, 23.3%, and 14.5% drop in investor share of home purchases. Condo prices in costal Florida are falling as HOA fees, insurance, and competing inventory all rise

• Office Buildout Costs Rise 5% In The U.S.

  A new study by Cushman & Wakefield, shows office buildout costs rose 4.7% on average across the U.S. San Jose, San Francisco, and New York all had the highest hard costs at over $200 per sq.ft. Cities like Chicago, Denver, and Toronto has average closer to $150 per sq.ft.

Deals Deals Deals

Sales

• Industrial: Penzance acquired Gateway & Linden, a six-building industrial portfolio totaling 212K SF in Manassas, VA, for $55mm from Davin Holdings and The Davis Companies

• Multifamily: Carter Multifamily acquired Mode at Melbourne, a 166-unit garden-style multifamily community in Melbourne, FL, for $38mm

• Medical Office: Sila Realty Trust Inc., acquired a 70K SF inpatient rehabilitation facility in Knoxville, TN for $35mm. The seller was not disclosed. The asset was fully leased to Knoxville Rehabilitation Hospital LLC

• Office: Fort Street Partners and Cumming Capital Management complete the acquisition of Lehi Spectrum I and II, two tech office properties totalling 265K SF in the heart of Lehi, UT

• Retail: Shaker Loudon Associates, an affiliate of Benderson Development, disposed of 120K SF, grocery-anchored shopping center in Latham, NY for $27mm. The asset was sold to an entity doing business as PCP Binghamton Associates LLC

• Medical Office: ESJ Capital Partners acquires a Oxford Court Portfolio, a nine-building, 152K SF medical office campus in Langhorne, PA, for $16mm from SkyREM

Debt

• Multifamily: Adam Tancredi secures a $116mm loan to develop 214 build-to-rent homes in Paso Robles, CA

• Multifamily: Pepper Pike Capital Partners secured a $89mm loan from Dwight Mortgage Trust to acquire The Waverly on the Lake, a 1,046 unit lakefront garden-style apartment community in Belleville, MI. The property also features 42 private boat slips

• Multifamily: SoLa Impact secured a $35mm construction loan from Acore Capital for 4301 Vermont, a 188-unit affordable housing development on in Los Angeles, CA’s Vermont-Slauson neighborhood

• Multifamily: One Real Estate Investment secured a $35mm construction loan from Synovus Bank to build The One at Montgomery, a 264-unit multifamily development in Montgomery, AL. The asset is set to open in 2026

• Multifamily: Windsor Associates, L.P. secures a $14mm, 10-year, Fannie Mae DUS loan to refinance Windsor Gardens, a 296-unit multifamily community in Rochester, NY

• Multifamily: Urban Capital Group and Prosper Property Group secure a $32mm acquisition and construction loan from Kriss Capital for a warehouse-to-condo conversion in New York City’s Tribeca

Developments

• Data Centers: An unnamed aeronautics and engineering firm put forth a proposal for a $2.8bn data center outside Spartanburg, SC

• Data Centers: BSO’s DataOne to develop a 300MW data center in Vineland, NJ

• Multifamily: XAG Group breaks ground on RASHA at Audubon, a 326-unit mixed-use community in Magnolia, TX. The project is part of the 3,000-acre Audubon master-planned community

• Industrial: DSV to spend $90mm on the construction of a 905K SF Laredo, TX distribution center

• Multifamily: Alpha Residential to develop Apex Diamond Ridge, a 352-unit apartment community and built-to-rent townhomes in Moonship Township, PA. Full completion is expected by spring 2027

• Multifamily: JPI has broken ground on Jefferson Morningstar, a 373-unit, four-story, garden-style multifamily community in The Colony, TX

• Multifamily: RangeWater Real Estate acquired 4 acres in Lilburn, GA where it plans to develop a 269-unit apartment community in partnership with TMGRI

Capital Raising

• Diversified: 400 Capital Management closes Asset Based Term Fund IV, a $1.39bn private credit fund focusing on residential and commercial real estate, and other asset-based securities. 

• Multifamily: Hillpointe, LLC raises $750mm for Hillpointe Workforce Housing Partnership V, LP. The fund is expected to support the development of approximately 30 workforce housing projects, representing approximately $2bn of total asset value and 10,000 workforce housing units across the Sun Belt

• Diversified: Brasa Capital Management raised $582mm after closing its third real estate fund. The fund will target residential and industrial on the West Coast and in Texas. The figure missed its initial fund target of $750mm

Meme Summary

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