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JULY 9, 2014 CenterPoint Eyes Recap of Industrial Portfolio CenterPoint Properties has hired CBRE to advise it on the recapitalization or sale 8 M&A ADVISOR RANKING of a 20 million-square-foot industrial portfolio in the Midwest. CenterPoint, which is owned by a Calpers partnership, prefers to sell a majority 2 Angelo Gordon Marketing 2 Funds stake — perhaps 90% or more — and continue to manage the properties, valued 3 Exeter Dealing Industrial Portfolio at about $1 billion. But it evidently would consider an outright sale and might also look at selling full or partial ownership of properties in stages. 3 Value-Added Office Plays in Virginia Market pros said the Calpers partnership has no intention of selling the rest of Cen- terPoint’s properties, totaling roughly 25 million sf. Those are “intermodal” distribu- 3 Phila.-Area Apartments Up for Grabs tion campuses, which are large facilities where shipping containers can be transferred 4 HIG Mapping $500 Million Fund from one mode of transportation to another, such as from ship to rail. The crown jewel among them is the 12 million-sf CenterPoint Intermodal Center in the Chicago suburb 5 Partner Sought for Jamaica Project of Elwood, Ill. CenterPoint has invested $1 billion in that 2,500-acre development. CenterPoint, of Oak Brook, Ill., is owned by CalEast Global Logistics, a joint 6 Ohio Warehouse Portfolio for Sale See CENTERPOINT on Page 7 6 Power Center Near SF Up for Grabs 6 Industrial Park Near Seattle Available Niche Fund Shop Pitching $1 Billion Vehicle Kayne Anderson Real Estate 7 Industrial Sale-Leaseback Pitched Niche specialist is seeking to raise $1 billion of equity for its fourth value-added fund, just a year after the final close of its third vehicle. 7 JP Morgan Showing Atlanta Rentals The real estate arm of Los Angeles-based Kayne Anderson Capital shoots for a roughly 15% return by acquiring senior housing, student housing, self-storage 8 American Realty Boosts Merger Tally properties and medical-office buildings nationwide. 9 Core-Plus Office Play in Virginia With leverage, the fund, Kayne Anderson Real Estate Partners 4, would have some $2.8 billion of buying power if it reached the equity goal. 9 REIT Tees Up NJ Office Building The predecessor vehicle, which wrapped up fundraising in May 2013, was over- subscribed, exceeding its initial $700 million equity target by $50 million. That 11 MARKET SPOTLIGHT vehicle is more than half invested. Kayne, which isn’t using a placement agent, is primarily soliciting limited part- ners from its earlier funds. According to Preqin, investors in those vehicles include THE GRAPEVINE Eisner Foundation, Nationwide Insurance, Nationwide Retirement Fund, Wyoming See NICHE on Page 5 Vivian Tongalson has left Northwood Investors, where she was head of investor relations and fund raising. Her plans are South Korean Player Zeroes In on DC Offices unknown. Tongalson, a managing direc- Mirae Asset Global Investments is in talks to buy a Washington office building for tor, joined New York-based Northwood roughly $440 million. in 2011. Before that, she was director of The 570,000-square-foot property, at 1801 K Street NW, is owned bySomerset fund communications for Highstar Capital Partners of New York. of New York, a private equity shop. She At the $772/sf price tag, Mirae’s initial annual yield would be 5%. If the deal is previously was an associate at Blackstone. completed, the South Korean asset manager would likely syndicate the investment Northwood, which was founded in 2007 among other South Korean pension funds. JLL is the broker. by former Blackstone real estate chief Somerset came close to selling the building last year to the Federal Reserve John Kukral, operates the $3.6 billion Board, which occupies about 35% of the space. But that deal — rumored to be in Northwood Real Estate Partners fund. the range of $450 million to $475 million — fell through. The L-shaped building, completed in 1972, fits the profile of well-located, stabi- Industry veteran Laurance Kaufman lized properties that investors are eager to acquire. It’s almost fully occupied, with joined Bluerock Real Estate in New York a weighted average lease term of more than 8 years. All tenants, including the Fed, See GRAPEVINE on Back Page See PLAYER on Page 6 July 9, 2014 Real Estate 2 ALERT Angelo Gordon Marketing 2 Funds vehicle. Initial closes for both vehicles are expected before yearend. Angelo, Gordon & Co. is back on the marketing trail, solicit- The predecessor vehicles — the $1.25 billion AG Realty ing a combined $2.5 billion of equity for opportunistic and Fund 8 and the $1 billion AG Realty Core Plus Fund 3 — core-plus funds. held final closes in 2012. Each is more than three-quarters The New York shop is telling investors it wants to corral invested. $1.5 billion for AG Realty Fund 9, an opportunistic vehicle Angelo Gordon has been one of the more active fund- that would target a 20% return, and $1 billion for AG Core raising shops in the past few years. The manager is close Plus Realty Fund 4, which would aim for a 12% return. With to halfway toward the $500 million equity goal for its first leverage, the investment capacity would be up to $4 billion European vehicle, AG Europe Realty Fund, which will target for the opportunity fund and up to $3 billion for the core-plus value-added deals. It completed raising $1 billion this year for a core-plus vehicle that invests in net-leased properties, AG Net Lease Realty Fund 3. And it is seeking to raise $750 million for an opportunity fund, AG Buy & Sell Real Estate Online Asia Realty Fund 3. The AG Realty Fund series mostly buys buildings and dis- tressed commercial mortgages. It also develops properties. The core-plus series buys proper- ties and distressed loans. Both vehicles invest in office, retail, multi-family and mixed-use properties. Angelo Gordon doesn’t use a placement agent. Investors in prior funds include Boston City Retirement, Contra Costa Employees, Hawaii Employees, Los Angeles Water & Power, Montana Board of Investment, Nebraska Investment Council, New Mexico Investment Council, Pennsylvania Public Employ- ees, Texas County and District Featured Closings • June 2014 Retirement and Texas Perma- nent School Fund, according to Preqin. The roughly core-plus series has raised roughly $2.3 billion of total equity to date, while the opportunistic platform has lined up $3.7 billion. Fully-Occupied STNL Global HQ Building High Visibility, Class A Office Correction Low Vacancy Metro Detroit Industrial Market Strategically Located for Dynamic Tenant Mix 44,246 SF • Michigan 58,763 SF • Indiana A “New Deals” item on July 2, “Philadelphia Apartment Com- $25 Billion Sold plex,” misidentified the broker www.auction.com/sell that represented AvalonBay Communities in the sale of the 855-574-6325 Oakwood Philadelphia apart- View licensing at www.auction.com/licensing ©2014 Auction.com, LLC All rights reserved. 1 Mauchly, Irvine, CA 92618 800-499-6199 ment property in Philadelphia. The broker was JLL, not HFF. July 9, 2014 Real Estate 3 ALERT Exeter Dealing Industrial Portfolio two four-story buildings, was completed in 1987. It has a fit- ness center and underground parking. Exeter Property is shopping a virtually fully leased portfolio James Campbell, based in Kapolei, Hawaii, acquired the prop- of industrial properties that could attract bids of $325 million. erties for almost $130 million in separate transactions in 1999 The 6.7 million-square-foot offering encompasses 22 distri- and 2006. The investment shop is now redeploying capital into bution centers across seven states in the Midwest and South- other asset classes, including industrial and retail properties. east. At the estimated value of $49/sf, the buyer’s initial annual yield would be about 6.5%. JLL has the listing. Phila.-Area Apartments Up for Grabs Exeter, an investment shop in Plymouth Meeting, Pa., con- trols the properties via a fund that has reached the end of its life J.P. Morgan Asset Management is marketing a suburban cycle. It is offering them as a package. Philadelphia apartment complex as a value-added play. The buildings range in size from 60,000 sf to 771,000 sf. Sin- The 375-unit Riverwalk at Millennium, at 309 Washington gle-tenant properties account for three-quarters of the space. Street in Conshohocken, Pa., is expected to attract bids of $95 Two-thirds of the space was developed for specific tenants. million, or $253,000/unit. HFF has the listing. Close to half of the space is leased by investment-grade com- The property is 95% occupied. It encompasses a mix of one- panies. The 27 tenants include Caterpillar, CEVA Logistics, Home and two-bedroom units, some with loft-style floorplans. Fea- Depot and Zappos. tures include nine-foot ceilings and washer/dryers. Community The weighted average remaining lease term is about three amenities include a pool, a business center, a fitness center and years. The pitch is that a buyer could boost below-market rents underground parking. The complex is on the Schuylkill River, upon rollover. with many units offering river views. The largest concentrations of space are in the Indianapolis The five-building development is relatively new, having area (1.8 million sf) and Kentucky and Tennessee, which have been completed in two phases in 2005 and 2010. But the units’ 1.4 million sf each. The rest is in North Carolina (670,000 sf), interior finishes are considered inferior to those of competing South Carolina (660,000 sf), Illinois (451,000 sf) and Ohio properties. The pitch is that a buyer could update the appli- (355,00 sf).

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