Bally’s faces federal, local scrutiny over how it secured Chicago casino license – Robert Khodadadian

The process through which Bally’s secured the coveted Chicago casino license has come under federal and local scrutiny.

One investigation is reportedly led by the U.S. attorney’s office, initiated in response to complaints lodged by unsuccessful bidders in the casino licensing process, Crain’s Chicago reported.

Alderman Brian Hopkins, a consistent critic of former Mayor Lori Lightfoot’s management of the casino proceedings, confirmed the existence of the federal inquiry, the outlet reported.

Simultaneously, a parallel investigation is said to be underway, conducted by Chicago Inspector General Deborah Witzburg. 

Witzburg, adhering to office policy, declined to comment on the matter, and the U.S. attorney’s office did not respond to requests for comment. 

Lightfoot’s spokeswoman, Joanna Klonsky, and her casino bidding process head, then-Deputy Mayor Samir Mayekar, claimed ignorance of any inquiry, attributing talk of an investigation to disgruntled losing bidders spreading false rumors.

Bally’s, the Rhode Island-based gambling company, said it is not aware of any investigation. 

The city’s Law Department has clarified that neither they nor the mayor’s office have been subpoenaed or requested to provide information.

But the inquiries, according to Crain’s, started months ago. 

Bally’s faced controversy earlier when it was allowed to alter the terms of its financial deal with minority investors after inserting a clause that could buy out minority shares at a non-negotiated price post-casino opening. Reports also revealed discrepancies in the fees charged to different bidders and conflicts of interest with city consultants evaluating financial prospects.

Despite these controversies, the casino won City Council approval with a 39-5 vote. 

The project, anticipated to cost $1.7 billion, is set to help alleviate the city’s unfunded public employee pension liabilities. Bally’s opened a temporary casino in September at the former Medinah Temple, with construction on the permanent site expected to commence soon and an opening scheduled for late 2026. 

Chicago officials have kicked around the idea of a casino for decades, with some city leaders viewing such a development as a potential financial savior. The proposition didn’t gain serious traction until 2020.

“This is a big deal. This is something three administrations have been trying to do,” 27th Ward Ald. Walter Burnett, who represents the area the casino will occupy in a nod to Lightfoot, said at the time. “This mayor got it done.”

The gaming company’s path to building Chicago’s first casino hasn’t been smooth, with some aldermen alleging the process lacked transparency and doubting Bally’s ability to pull off the project.

— Ted Glanzer

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Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Casinos, Chicago Development The process through which Bally’s secured the coveted Chicago casino license has come under federal and local scrutiny. One investigation is reportedly led by the U.S. attorney’s office, initiated in response to complaints lodged by unsuccessful bidders in the casino licensing process, Crain’s Chicago reported. Alderman Brian Hopkins, a consistent critic of former Mayor Lori
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OpenAI CEO Sam Altman went on $85M real estate splurge – Robert Khodadadian

Before he was out and back in again, OpenAI CEO Sam Altman went on a real estate spending spree.

Between early 2020 and mid-2021, Altman spent $85 million on residences in San Francisco, Napa, and an estate in Hawaii, Business Insider reported.

Altman’s $43 million Hawaii property, acquired in July 2021, spans 12 bedrooms in Kailua-Kona on the Big Island, adjacent to a national landmark — a reconstruction of the royal temple of King Kamehameha I.

Videos of the property showcase amenities like cliff jumping, motorboating, and scuba diving. Altman’s purchase of the property was uncovered by examining business and real estate filings linked to an LLC managed by Jennifer Serralta, Altman’s cousin and COO of his family office.

In addition to his Hawaii estate, Altman’s real estate portfolio includes a $27 million San Francisco home purchased in March 2020, serving as the base for various investment vehicles. 

His weekend retreat is a $15.7 million working ranch in Napa, acquired in late 2020, covering 950 acres with five homes and vineyards. Altman frequently flies friends and colleagues to the Napa property.

Altman’s salary is just $58,333, according to IRS filings, and he professes that his equity stake in OpenAI is “immaterial.” But his acquisitions reflect the lifestyle of Silicon Valley titans, joining the likes of Mark Zuckerberg, Larry Ellison, Marc Benioff, Jeff Bezos, and Peter Thiel, who also own substantial properties in Hawaii. 

— Ted Glanzer

The post OpenAI CEO Sam Altman went on $85M real estate splurge appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Hawaii, Luxury Real Estate, Mansions, Napa, San Francisco Before he was out and back in again, OpenAI CEO Sam Altman went on a real estate spending spree. Between early 2020 and mid-2021, Altman spent $85 million on residences in San Francisco, Napa, and an estate in Hawaii, Business Insider reported. Altman’s $43 million Hawaii property, acquired in July 2021, spans 12 bedrooms in
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The Distress Record: Greenland USA’s Pacific Park troubles, FMB files for Chapter 11 – Robert Khodadadian

Ten years after breaking ground, Greenland USA is set to lose control of its $5 billion Pacific Park megaproject in Brooklyn. 

The firm defaulted on $350 million in loans that cover the six incomplete sites at Pacific Park (out of 15 project sites in all) that are slated for more than 3,200 units — if they are ever built. 

The auction is scheduled for Jan. 11.

Greenland — a subsidiary of China’s state-owned Greenland Group —  bought a 70-percent stake in 2014 in what was then Atlantic Yards from Forest City Ratner, which proposed the project in 2003.

A 2025 deadline looms for Greenland to build the affordable housing component of the project. 

In Los Angeles, FMB Development’s ambitious apartment project in Van Nuys has gone from defaulting on a loan to filing for bankruptcy. The Chapter 11 protection aims to address mounting debts and financial challenges, with liabilities ranging from $10 million to $50 million.

FMB has owned the land since 2018, when it paid $9.5 million for the roughly 1-acre site, according to property records. It planned a six-story apartment building with ground-floor retail. 

In Houston, a lender has taken steps to foreclose on  264-unit Retreat at Stafford apartment complex, after the owner, Austin-based GVA Real Estate Group, defaulted on a $288 million loan, Bisnow reported. 

The loan, issued by LoanCore Capital in February 2022, has five borrowers, all LLCs connected to apartment complexes owned by GVA. In addition to the Stafford apartments, the mortgage is tied to two properties in the Dallas-Fort Worth area, along with two more in Tennessee and South Carolina. 

Meanwhile, in Chicago, an affiliate of Tom Scott’s  CA Ventures has fallen behind on payments for debt tied to a recently built Arlington Heights apartment complex.

The owner of the 263-unit rental asset at 3401 West Payton Place in the northwest suburb of Chicago is between 30 and 59 days delinquent on the $75 million loan the property secured in 2021, according to credit ratings agency DBRS Morningstar.

The loan was originated by an affiliate of San Francisco-based publicly traded TPG Real Estate Finance Trust with an adjustable interest rate, meaning its debt service payments have likely risen in step with this year’s rate increases by the U.S. Federal Reserve. It isn’t scheduled to mature until late 2024.

CA Ventures claims to own assets totaling $10 billion in value worldwide. The loan delinquency came to light with the firm on the defense in multiple thorny lawsuits in jurisdictions across the nation. 

CA Ventures is among an array of multifamily players to encounter upset investors and legal risks stemming in part from difficulty refinancing loans at higher rates. 

More on distressed properties and businesses:

Isaac Hager bought a distressed Crown Heights office building

Even with $120M in state grants, Shangri-La Industries in LA can’t repay loans

Prado Group takes over 20 multifamily properties in San Francisco from Veritas

Multifamily goes from darling to distress in Texas

The post The Distress Record: Greenland USA’s Pacific Park troubles, FMB files for Chapter 11 appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Distress Ten years after breaking ground, Greenland USA is set to lose control of its $5 billion Pacific Park megaproject in Brooklyn.  The firm defaulted on $350 million in loans that cover the six incomplete sites at Pacific Park (out of 15 project sites in all) that are slated for more than 3,200 units — if
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Rene Benko’s Signa files for insolvency – Robert Khodadadian

Signa Holding’s billion-dollar tumble into insolvency is complete.

Rene Benko’s main holding company filed for the bankruptcy-like procedure in Austria, the Wall Street Journal reported. Benko’s property portfolio, once valued as high as $30 billion, is faced with an uncertain future as Signa restructures and Benko cedes control to a restructuring manager.

Among Signa’s major holdings are stakes in large European department stores, luxury British retailer Selfridges and the Chrysler Building in Manhattan, which Benko purchased in partnership with Aby Rosen’s RFR Holding in 2019. A spokesperson for RFR said the company would happily increase its stake should Signa need to lighten the load.

Benko’s investments didn’t cease when the property market slumped and interest rates rose, one possible explanation for why Signa became insolvent. Benko teamed with Thailand’s Central Group to buy Swiss luxury department-store chain Globus after the pandemic’s onset, followed in 2021 by the purchase of most of Selfridges.

JPMorgan Chase analysts estimated that Signa’s two largest subsidiaries carried more than $14 billion in debt and liabilities. More than $4.5 billion of that is floating rate debt. More than $1 billion of the debt was slated to come due this year, another 37 percent set to mature in the next four years, according to JPMorgan.

Swiss bank Julius Baer has roughly $690 million lent to Signa, while Austrian bank Raiffeisen Bank International is exposed to the tune of $830 million.

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Signa’s collapse is significant enough that the European Central Bank is monitoring the insolvency procedure for broader ripple effects.

The 46-year-old Benko’s rise was nearly as quick as his fall. He started his real estate business by renovating apartments before acquiring a majority of the Karstadt department-store chain in 2012, expanding rapidly from there. 

He’s also had some legal troubles, including a tax fraud conviction that year after allegedly trying to bribe Italian officials. This year, Benko was acquitted on bribery charges in Austria.

— Holden Walter-Warner

The post Rene Benko’s Signa files for insolvency appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Bankruptcy, Distress, Europe, Retail Signa Holding’s billion-dollar tumble into insolvency is complete. Rene Benko’s main holding company filed for the bankruptcy-like procedure in Austria, the Wall Street Journal reported. Benko’s property portfolio, once valued as high as $30 billion, is faced with an uncertain future as Signa restructures and Benko cedes control to a restructuring manager. Among Signa’s major
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Palm Island neighbors combine homes for $150M listing – Robert Khodadadian

One Palm Island resident had the gall to tell the homeowner next door, “Lend me your real estate. I am your neighbor!” And they agreed!

Two adjacent homeowners are marketing their three luxury Miami Beach homes for a combined $150 million, the Wall Street Journal reported. The homeowners are trying to make out like bandits as wealthy buyers continue showing interest in Miami.

The idea originated as all good ideas do: over a bottle of wine. Jorge Luis Garcia, former owner of Orlando Family Physicians, pitched the idea of marketing his two waterfront properties alongside the adjacent property owned by Juan Miguel Almeida and Adria Adrian Almeida.

Addressed at 190 Palm Avenue, the listing includes three waterfront homes with a combined 300 feet of water frontage across two acres of land. The listing includes 20 bedrooms, 28 bathrooms and more than 35,000 square feet of living space, breaking down to $4,239 per square foot.

Coldwell Banker’s Cesar Powell (Coldwell Banker)

Each house has a pool, dock and four-car garage. They were built between 2008 and 2016 as part of a family compound by developer Pedro Adrian — Adria Adrian’s father — before his son, Alvaro Adrian, sold his property to Garcia in 2019 for $13.9 million. Two years later, Pedro Adrian sold his own property to Garcia for $17 million, who proceeded to rent it out for $120,000 per month.

The price is astronomical, but buyers can take heart in knowing the properties will be fully furnished when they move in. Prospective buyers should know that the Palm Beach sales record recently fell at $32 million and the median price for a luxury single-family home in the third quarter was $19.8 million, according to Miller Samuel.

Coldwell Banker Realty’s Cesar Powell has the listing.

Buyers who tour one of the three properties and want to stop there shouldn’t bother going out to Palm Island — the listing is an all or nothing proposition.

“If we don’t get that number, we’re not selling,” Juan Miguel Almeida told the Journal.

— Holden Walter-Warner

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Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Luxury Real Estate, Miami Beach, Palm Island One Palm Island resident had the gall to tell the homeowner next door, “Lend me your real estate. I am your neighbor!” And they agreed! Two adjacent homeowners are marketing their three luxury Miami Beach homes for a combined $150 million, the Wall Street Journal reported. The homeowners are trying to make out like bandits
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East Bay home that cost $135M to build lists for fraction of that price – Robert Khodadadian

An Alamo estate built by a tech billionaire at a cost of more than $135 million is on the market for a fraction of that amount, though if it comes anywhere close to its $35 million asking price it will rank as the most expensive sale ever in Contra Costa County.

PeopleSoft founder David Duffield bought the 21-acre property in 2005 and worked until 2010 to permit, design and build his family estate — dubbed Fieldhaven. It has a main French Country-style home with 10 bedrooms, 13 full bathrooms and nine half-baths in more than 20,000 square feet. 

There’s also a two-bedroom guest home, a custom-designed treehouse entered via a 75-foot-long rope bridge, a 20-slot car barn with guest suite above, an aviary created by a curator at the San Francisco Zoo and a dog spa, according to a press release on the listing. The construction alone took more than three years and involved builders, designers and craftspeople from around the world. 

The tech billionaire sold the estate in August 2020 for $19 million to J. Taylor Crandall, a former senior advisor at Crosspoint Capital, a private equity fund focused on cybersecurity. The Duffields donated the proceeds to their family foundation, Maddie’s Fund, named in memory of a family dog, which provides grants to animal causes. 

The sale set the record for Contra Costa County, which includes Lamorinda, Walnut Creek, Danville and Brentwood, and no other home has been able to top it since, according to Redfin data. The closest is 10 Serenity Lane, which is next door to Fieldhaven, and sold for $16.7 million in June 2021. 

Marilee Headen of Compass and Taso Tsakos of Engel & Volkers are co-listing the property on behalf of the Crandalls. Headen said the agents looked at comps from across the Bay Area, not just the East Bay, to determine the price for the property, which she said would cost $250 million to build today.

That includes about $6 million of improvements the Crandalls put in. Upgrades include a solar field that creates enough energy to power the estate.

Crandall will miss the “incredible amenities of the Alamo property, especially his car barn,” according to Headen. She represented the Crandalls when they bought the home in 2020 and Tsakos represented the Duffields. 

“We worked well together in that transaction and bring different skill sets to the table,” Headen said of why they were chosen to list the property as a team.

The Crandalls are moving to a home they own nearby to be closer to their children’s schools, Headen said. Crosspoint Capital is based in Menlo Park but Crandall moved his family from Atherton to Alamo to begin with because of the schools, according to the press release.

In the search for buyers, the agents will target “wealthy individuals from all the main hubs” locally and nationally, Tzakos said, including Silicon Valley, San Francisco, L.A., New York and Florida. They will also be doing a heavy international marketing push.

“You never know where the buyer will come [from],” he said.

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The post East Bay home that cost $135M to build lists for fraction of that price appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Alamo, Contra Costa, East Bay, Luxury, top price An Alamo estate built by a tech billionaire at a cost of more than $135 million is on the market for a fraction of that amount, though if it comes anywhere close to its $35 million asking price it will rank as the most expensive sale ever in Contra Costa County. PeopleSoft founder David Duffield
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Jury in Ed Burke trial hears from 601W’s Harry Skydell on secret recordings – Robert Khodadadian

Harry Skydell of major office landlord 601W Cos., a tight-lipped developer behind the $600 million renovation of the Old Post Office, entered unfamiliar territory as his private discussions with indicted former Chicago alderman Ed Burke spilled into a public courtroom this week.

Jurors in Burke’s federal corruption trial heard secret recordings of talks between Skydell and Burke, whose case is now in the thick of witness testimony.

It revealed that Burke tried to sway Skydell — who rarely speaks to media  — into hiring the then-alderman’s law business, Klafter & Burke, to handle property tax work for the massive transformation of the Old Post Office into a nearly fully leased workspace, the Chicago Tribune reported.

“I can’t pull the rug out from under them, it’s, it’s like immoral,” Skydell said on one recording, referring to other law firms he had already hired to do tax work on the Old Post Office.

Jurors also heard Burke’s infamous quote about landing “the tuna” in reference to the Old Post Office renovation’s tax work.

The project represented a huge financial opportunity for Burke, and he allegedly pursued 601W’s property tax work relentlessly, according to the recordings that were secretly made by Daniel Solis, another ex-alderman who acted as a government mole and played a crucial role in the indictment of Burke. Skydell’s conversations with Burke were also recorded and played for the jury, the newspaper reported.

Burke, who served as alderman for 54 years until this spring, faces 14 charges of racketeering, federal program bribery, attempted extortion and conspiracy to commit extortion. Prosecutors allege that Burke used his influential position as an alderman and chair of the Chicago City Council’s Finance Committee to benefit Klafter & Burke, which specializes in property tax appeals.

“He will handle the tax work. … You can assure him of that,” Skydell said to Solis, referring to hiring Burke to work on the Sullivan Center skyscraper’s taxes. “It will come from the horse’s mouth.”

By spring 2017, Burke believed he had demonstrated his value to Skydell by intervening on behalf of 601W with train network Amtrak and the city’s Department of Water to address issues slowing the Old Post Office renovation. Despite these efforts, Skydell ultimately chose not to hire Klafter for the Old Post Office renovation but said he would offer Burke work on other properties.

Throughout 2018, Burke continued pressing Solis to inquire about property tax work from Skydell. The recordings revealed Skydell assuring Solis that they would have work for Burke, but commitments were not materializing. Burke expressed frustration, especially when Skydell sought $20 million in tax-increment financing for the Old Post Office project.

“And as far as I’m concerned, they can go f**k themselves,” Burke said in the recordings.

Solis conveyed Burke’s feelings to Skydell, and while aiming to secure TIF funding for Skydell’s project, the developer seemed to promise tax work on the Sullivan Center on East Madison Street to Burke. The prosecution claims Burke offered a consulting fee to Solis in exchange for helping secure business from 601W.

The trial also touched on Burke’s involvement in subsidies for 601W, with jurors learning about his resistance to the $20 million TIF request.

The trial, now in its third week, presented nearly two dozen recorded meetings and wiretapped calls detailing Burke’s pursuit of legal business from 601W. The recordings captured Burke’s increasing frustration over the developer’s lack of commitment to his law firm.

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The proceedings took an unexpected turn when U.S. District Judge Virginia Kendall ended the day early after noticing a juror had fallen asleep, Crain’s reported.

The defense’s request for a mistrial was also rejected by Judge Kendall, who expressed trust in the jury’s ability to follow instructions to disregard a witness who said that Burke’s law firm’s involvement with a property seemed “corrupt.” The trial will continue with more witnesses and weeks ahead.

— Quinn Donoghue 

The post Jury in Ed Burke trial hears from 601W’s Harry Skydell on secret recordings appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Crime, Office Market, Property Taxes, trial Harry Skydell of major office landlord 601W Cos., a tight-lipped developer behind the $600 million renovation of the Old Post Office, entered unfamiliar territory as his private discussions with indicted former Chicago alderman Ed Burke spilled into a public courtroom this week. Jurors in Burke’s federal corruption trial heard secret recordings of talks between Skydell
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AMS Acquisitions getting tax break for 906-unit Yonkers project  – Robert Khodadadian

AMS Acquisitions is getting some help from Yonkers to build one of the biggest apartment projects in recent Yonkers memory.

AMS received preliminary approval from the Yonkers Industrial Development Agency for tax incentives to aid its $458 million Teutonia Hall luxury rental project, according to the IDA. The developer is awaiting final approval on its requests, which include $12.9 million in sales tax exemptions and $4.4 million in mortgage recording tax exemptions.

The developer’s long-term plan for 4 Buena Vista Avenue is a mixed-use project with 906 apartments over two 41-story towers. The massive development will also have 907 parking spaces and 2,900 square feet of retail. Roughly 10 percent of the rentals will be designated affordable.

Construction will unfold in two phases. The first, anticipated to begin next September, will include a building with 510 units and two-thirds of the parking podium. It would wrap in December 2027.

The second phase would kick off in December 2028 and finish three years later.

New York City-based AMS, led by Michael Mitnick, acquired the downtown Yonkers site for $18.3 million in 2018, then expanded its plans for the site. The site was formerly home to the Teutonia Music Hall.

This summer, AMS received a green light for its 18-story Silk Loft East and six-story Silk Loft West in Bayonne, New Jersey. The two projects will deliver a combined 286 housing units, all market-rate.

In other news, Westchester County’s Local Development Corporation granted final approval for $52 million in tax-exempt bond financing for New York Blood Center to redevelop Avon’s former headquarters in Rye.

The nonprofit is set to occupy the entire 187,000-square-foot property at 601 Midland Avenue, using it for office space, laboratories, processing storage and distribution of blood and other supplies. The Blood Center is also building a tower on Manhattan’s East Side.

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The post AMS Acquisitions getting tax break for 906-unit Yonkers project  appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Multifamily Real Estate, Westchester County, Yonkers AMS Acquisitions is getting some help from Yonkers to build one of the biggest apartment projects in recent Yonkers memory. AMS received preliminary approval from the Yonkers Industrial Development Agency for tax incentives to aid its $458 million Teutonia Hall luxury rental project, according to the IDA. The developer is awaiting final approval on its
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Real estate jobs grow 2.1% across Southern California in October – Robert Khodadadian

Southern California added more than 10,000 real estate jobs last month, mostly in construction.

Property-linked employment in Los Angeles, Orange, Riverside and San Bernardino counties hit a post-Great Recession high of 805,200 in October, up 10,200 for the month, the Orange County Register reported.

Real estate work grew locally by 16,300 jobs over 12 months, a gain of 2.1 percent. 

The upswing represents a turnaround from last spring, when sluggish home sales across Southern California led to the loss of 4,600 real estate jobs in March, with hiring picking up in May.

The growth came despite higher interest rates. Higher financing costs have slowed residential sales and made some development projects unaffordable.

Local construction work grows because of giant infrastructure projects, according to the Register.

Other property-related work has been relatively stable, as many real estate workers are self-employed and not counted in state employment figures.

Across Southern California, work in all other industries hit a post-crash high with 7.3 million people on the payroll — up 88,200 jobs in a month. Over 12 months, non-real estate jobs were up 118,100, a gain of 1.6 percent.

The real estate job market was 9.9 percent of total employment last month. The industry’s hiring equaled 10 percent of all new local jobs for the month and 12.1 percent of Southern California hires for the year.

Since 2010, real estate-related jobs have equaled 9.7 percent of all Southland jobs and 12.7 percent of local hiring.

Work in the building, civil and construction trades grew 2.1 percent year-over-year in October, to 125,500 jobs. Work in specialty trades hired by contractors grew 3.2 percent year-over-year to 267,000 jobs. 

Work in building services for commercial property operations grew 4.9 percent to 115,900 jobs.

At the same time, work in real estate lending grew 1 percent to 103,100 jobs, while jobs in real estate services fell 0.2 percent to 141,500 jobs. 

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— Dana Bartholomew

The post Real estate jobs grow 2.1% across Southern California in October appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Real estate jobs Southern California added more than 10,000 real estate jobs last month, mostly in construction. Property-linked employment in Los Angeles, Orange, Riverside and San Bernardino counties hit a post-Great Recession high of 805,200 in October, up 10,200 for the month, the Orange County Register reported. Real estate work grew locally by 16,300 jobs over 12 months,
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Harbor and Evergen snag warehouse campus in Gardena for $55M – Robert Khodadadian

Harbor Associates and Evergen Equity have picked up four industrial buildings in Gardena for $55 million.

The Long Beach- and Austin-based investors bought the 126,000 square feet of warehouses at 690-760 West 190th Street, the Commercial Observer reported. The seller was not disclosed.

The property was owned last year by Campbell, Campbell and Campbell, based in Rolling Hills Estates, according to property records. It was last traded in 1977 for an unknown price.

The South Bay industrial buildings next to the 405 and 110 freeways interchange run from 17,000 square feet to 45,000 square feet on 7.5 acres.

The purchase by Harbor and Evergen works out to $436 per square foot, $7.3 million per acre.

L.A.’s industrial sales averaged $314 per square foot through the first 10 months of this year, according to a report by CommercialEdge, making it the most expensive market in the nation. 

The deal adds to $3.55 billion in industrial properties sold this year in Los Angeles County, second to the Inland Empire in transaction volume

Evergen CEO Troy Marcus said the asset “will be one of the crown jewels in our logistics portfolio.”

Executives at Harbor Associates said the owners are looking at several options, including building a Class A industrial outdoor storage facility for trucks and containers.

“This submarket is incredibly dense and is one of the few in the area that allows for trucking and shipping container uses,” Paul Miszkowicz, a principal at Harbor, said in a statement. “This has ‘super-charged’ the demand as (third-party logistics) and logistics companies compete for a diminished supply of truck yards.”

The warehouse campus is Harbor’s third industrial buy this year, in which it surpassed $120 million in acquisitions, and adds to a 640,000-square-foot industrial portfolio in Southern California.

Brokers Eric Cox, Barbara Perrier and Darla Longo of CBRE advised the unidentified seller on the deal.

— Dana Bartholomew

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The post Harbor and Evergen snag warehouse campus in Gardena for $55M appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, trucking and container storage, Warehouses Harbor Associates and Evergen Equity have picked up four industrial buildings in Gardena for $55 million. The Long Beach- and Austin-based investors bought the 126,000 square feet of warehouses at 690-760 West 190th Street, the Commercial Observer reported. The seller was not disclosed. The property was owned last year by Campbell, Campbell and Campbell, based
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REBNY vows to fight antitrust lawsuit  – Robert Khodadadian

New York City’s governing real estate authority vowed to get tough on the Big Apple’s edition of a series of antitrust lawsuits targeting residential commission rules. 

The Real Estate Board of New York told members in a Thursday morning email it would dispute an antitrust lawsuit filed by a New York home seller against it and 26 area real estate firms. The lawsuit filed earlier this month alleges REBNY’s Universal Co-Brokerage Agreement violated antitrust laws with its rules requiring sellers to pay buyers’ agents. 

“REBNY will vigorously defend the litigation and respond to the complaint, which is laden with numerous inaccuracies regarding the RLS, the UCBA, and the business of real estate,” the board said in its notice to agents. 

The group declined to comment. 

The organization updated the UCBA in October, including a change to prohibit listing brokers from paying buyers’ agents, instead requiring sellers to pay them directly. The new rules take effect January 1. 

The lawsuit in New York City was filed less than two weeks after a verdict in Sitzer/Burnett, an antitrust case filed in Missouri agains the National Association of Realtors and two residential brokerages, HomeServices of America and Keller Williams. 

The trial centered on the trade group’s commissions requiring brokers to offer compensation to buyer’s agents in exchange for access to Realtor-controlled MLSs. T jury found the firms liable of colluding to inflate commissions andawarded $1.8 billion in damages, which the judge can treble to more than $5 billion. NAR vowed to appeal the verdict, which is awaiting final approval by a judge. 

REBNY said in its message to members the huge sum won by the plaintiffs in Missouri likely inspired the lawsuit filed in New York, which is in good company with copycat complaints by sellers and buyers targeting firms in a slew of markets, including in Illinois, New England and Texas. 

REBNY’s fellow defendants in the New York complaint have also been named in antitrust suits across the country. The pressure is mounting for national brokerages named in multiple suits, which pose enormous costs because of the massive amount of discovery they entail and potential settlement or damages, which can total in the tens of millions or billions of dollars.

Anywhere Real Estate and RE/Max proposed settlement deals before the Sitzer case headed to trial, agreeing to pay $84 million and $55 million, respectively. The deals, which are expected to be approved by a judge in mid-2024, also sought to exclude the firms from Moerhl v. NAR, a similar suit in Illinois set to go trial next year. 

Executives at the parent company of Corcoran, Coldwell Banker, Century21 and Sotheby’s International Realty were quick to brag about during the company’s recent third quarter earnings call, months after saying litigation costs had “meaningfully” impacted the company’s bottom line. 

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Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Lawsuit, Residential Real Estate New York City’s governing real estate authority vowed to get tough on the Big Apple’s edition of a series of antitrust lawsuits targeting residential commission rules.  The Real Estate Board of New York told members in a Thursday morning email it would dispute an antitrust lawsuit filed by a New York home seller against it
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Left at the closing table: $101M deal dissolves into lawsuits – Robert Khodadadian

A closing is a bit like a wedding — after a long courtship and months of planning, the two parties finally make things official. Both are also vulnerable to a runaway bride. 

In October, Austin developer Wilson Capital planned to sell two apartment complexes north of Austin to a New York-based investor for $101 million. But when Wilson’s representatives went to the closing on Oct. 16, the supposed buyer, River Rock Capital, never showed. Wilson terminated the contract the next day, but the battle had only just begun. 

The two firms are suing each other through multiple LLCs in New York and Texas, alleging a slew of defaults tanked their deal.

River Rock’s lawsuits tell a different story.

The firm claims Wilson failed to provide leasing and construction updates at the two developments: Brio, at 705 East Olympic Drive in Pflugerville, and the Sommery, at 5540 Sofia Place in Round Rock. Monthly rent rolls and status updates on certificates of occupancy at Brio, a new development, are among the information River Rock says it was denied. Those alleged breaches relieved River Rock of its own obligations under the contract, its lawsuits claim, and entitle it to a refund of its $2.5 million escrow deposit. 

River Rock also claims Wilson set the closing date unilaterally. The purchase agreement stipulated that the deal would close “on or about 45 days after” Wilson received certificates of occupancy for the residential buildings at Brio. The date of the attempted closing was exactly 45 days after Wilson allegedly sent the certificates to River Rock, but they were not sent to River Rock’s lawyer, according to River Rock’s lawsuit. 

Wilson has moved to dismiss River Rock’s suits, which were filed in New York, for lack of jurisdiction, as Wilson is based in Texas. A judge has asked River Rock to respond to that motion by Friday. 

Taylor Wilson, the founder and president of Wilson Capital, said his firm denies River Rock’s claims and believes the New York suits were filed “for the sole purpose of obfuscation and delay.”

River Rock and its attorney did not respond to a request for comment. 

Wilson alleges in its suits that it never breached the agreement and remains ready to meet its obligations. It is asking the court for its own $2.5 million escrow deposit back, plus damages. 

Elsewhere in Austin, Wilson is building Wilson Tower. The downtown apartment building was initially slated to climb 80 stories, which would have made it 30 feet taller than Houston’s JP Morgan Chase Tower, currently the tallest in the state. The building took a haircut in the planning process though, and is now projected to be 45 stories tall. 

River Rock invests in apartments in Texas and New Jersey, with a management and ownership portfolio of around 5,500 units, according to its website. 

Pflugerville and Round Rock are two of the busiest areas for population growth and new development in the country, as technology giants such as Tesla and Samsung have invested heavily in the region.

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The post Left at the closing table: $101M deal dissolves into lawsuits appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Commercial Real Estate, Lawsuits, Multifamily, river rock capital, wilson capital A closing is a bit like a wedding — after a long courtship and months of planning, the two parties finally make things official. Both are also vulnerable to a runaway bride.  In October, Austin developer Wilson Capital planned to sell two apartment complexes north of Austin to a New York-based investor for $101 million.
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What REBNY’s office visitation report actually measures – Robert Khodadadian

The specter of half-empty buildings, a reality supported by card-swipe data from Kastle Systems, hasn’t done office owners any favors. But the Real Estate Board of New York has another dataset with a more robust number: 66 percent.

That is not, however, the percentage of New York City office workers at their desks every day. Rather, it’s the amount of cell phone activity in office buildings today versus 2019, before the pandemic.

REBNY calls the 66 percent number an office visitation rate, Crain’s reported. But it really just means that cell phone activity in the buildings in September was two-thirds what it was throughout 2019.

The data is broader than Kastle’s, which misses all the buildings that don’t use its card-swipe services, including many that claim to have higher office attendance than the Kastle average. The omissions skew the results.

Kastle, which recorded a 50 percent occupancy rate for the week of Nov. 15, measures card swipes at 200 buildings in Manhattan, a majority of which are the Class A variety.

Some industry figures such as the Durst Organization’s David Neil have downplayed Kastle’s data because of the weight it puts on days of the week destined not to recover to pre-pandemic levels, specifically Fridays.

But REBNY’s report, which covers 350 buildings, has its own limitations. Office workers and executives who carry multiple phones into the office would inflate the numbers, as would tourists visiting stores and restaurants at the bottom of office buildings. A spokesperson for the city’s Economic Development Corporation shrugged that off, telling Crain’s it illustrates “vibrancy.”

Regardless of the framework, it’s clear that office visitation won’t return to pre-Covid levels, nor will occupancy rates — at least until the amount of office space is reduced by conversions and demolitions.

The shift to remote work has huge implications for cities’ tax revenue and everyone who relies on office workers, particularly office owners, lenders and investors, as well as restaurants and stores in office districts.

In May, a revised study from researchers at New York University and Columbia University estimated that the city’s offices would lose 44 percent of their pre-pandemic value by 2029, an increase of 16 percentage points from the previous year’s original study.

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REBNY’s visitation report has historically shown higher-end office buildings recovering from the pandemic faster than others, but the difference is marginal. In September, the average visitation rate in A+ properties was 67 percent of the 2019 figure, versus 65 percent for A, A-, B and C buildings.

However, the report doesn’t include office buildings that opened after 2019, such as SL Green’s massive office tower One Vanderbilt. Newer buildings figure to have higher visitation than older ones.

Midtown South led Manhattan office districts at 70 percent. Midtown came in at 67 percent and Downtown at just 60 percent.

— Holden Walter-Warner

The post What REBNY’s office visitation report actually measures appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Manhattan Office Market, office occupancy, Remote Work The specter of half-empty buildings, a reality supported by card-swipe data from Kastle Systems, hasn’t done office owners any favors. But the Real Estate Board of New York has another dataset with a more robust number: 66 percent. That is not, however, the percentage of New York City office workers at their desks every day.
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Redco and Midar use builder’s remedy on 400-unit project in Palo Alto – Robert Khodadadian

Redco Development and Midar Investment want to employ the state builder’s remedy to realize the largest housing complex with the third tallest building in Palo Alto.

The San Francisco-based developer and the Mill Valley-based owner of Mollie Stone’s Market  have filed preliminary plans to build three apartment buildings with nearly 400 apartments at 156 California Avenue, in Evergreen Park, the Silicon Valley Business Journal reported.

The project would replace a building containing a Mollie Stone’s grocery at California and Park Boulevard, which would move into the new development next to a Caltrain stop.

Redco and Midar would be the latest developers to propose builder’s remedy projects across the South Bay.

Renderings of plans for 156 California Avenue, Palo Alto (Mollie Stone’s Market, Redco Development)

Plans call for a 17-story tower, an 11-story structure and a seven-story complex that would have 15,000 square feet of combined ground-floor shops and restaurants, including Mollie Stone’s.

The trio of buildings would include 382 studio, one- and two-bedroom apartments. The developers would set aside 77 units for affordable housing.

The project, designed by San Jose-based Studio Current, includes apartments fronted by floor-to-ceiling windows, trimmed in white, according to a rendering.

Redco Managing Partner Chris Freise said the large complex wouldn’t really be out of character for Palo Alto. It would be built on a pedestrian-oriented street permanently closed this month to cars in order to create a “second downtown.”

“I know people are saying that it’s the third tallest building in Palo Alto, but these types of approximate heights already exist in several areas such as Palo Alto Square, Channing House, 101 Alma and City Hall,” Freise told the Business Journal.

Redco submitted its proposal under the builder’s remedy, an untested provision of state law that allows developers to bypass local zoning rules in cities that have failed to certify their required state housing plans. The remedy requires 20 percent of a project’s homes be affordable.

Palo Alto must plan to build 6,086 homes by 2031, but failed to get its Housing Element plan approved by the Jan. 31 deadline. This opens it up to the builder’s remedy, state housing officials and advocates say.

Ten of 16 cities in Santa Clara County have failed to get their plans approved, according to the Business Journal.

The Silicon Valley city adopted its housing plan in May and submitted it to the state in June. The  state rejected that plan in August, saying that “additional revision will be necessary to comply” with state law.

Nonetheless, Palo Alto insists it has complied with “the basic requirements” of state housing law — and thus is not susceptible to the builder’s remedy.

“The builder’s remedy does not apply,” the city wrote in a post on its website in reference to Redco and Midar’s three-building development proposal.

Midar and Redco disagree. They say only the state Housing & Economic Development Department can determine whether a city is in substantial compliance with the law, according to a letter to the city.

In March, Redco and AEW Capital Management walked away from San Francisco’s historic First National Bank building after failing to make their mortgage payments for 1 Montgomery Street. 

In June, Redco filed plans to build 126 apartments at 940 Willow Street in San Jose.

— Dana Bartholomew

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The post Redco and Midar use builder’s remedy on 400-unit project in Palo Alto appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Builder's remedy Redco Development and Midar Investment want to employ the state builder’s remedy to realize the largest housing complex with the third tallest building in Palo Alto. The San Francisco-based developer and the Mill Valley-based owner of Mollie Stone’s Market  have filed preliminary plans to build three apartment buildings with nearly 400 apartments at 156 California
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IWG expands into 21 more Illinois coworking spaces – Robert Khodadadian

Shared workspace provider IWG is doubling down on plans for expansion in the Chicago area and throughout Illinois, despite ongoing challenges for the coworking model and a rough office market harmed by hybrid work schedules.

The Switzerland-based coworking company is adding 21 locations in Illinois, nearly all in Chicago and its suburbs, the company announced on Tuesday.

The move runs counter to recent headlines about the coworking sector — its juggernaut WeWork filed for bankruptcy this month — and IWG sees hybrid work not as a problem for the office market. It’s adding hubs in suburbs where people previously commuted into the city.

“Our expansion in Illinois comes at a time when more companies are discovering that hybrid working boosts employee happiness and satisfaction, while helping the environment,” IWG’s CEO and founder Mark Dixon said in a statement. “Our workplace model is also proven to increase productivity and allows for a business to scale up or down at significantly reduced costs.”

Chicago locations include one in Ravenswood near Uptown, one in Fulton Market and one in River North. Suburban locations (see list below for addresses) include Arlington Heights, Downers Grove, Naperville, Elgin, Lisle, Park Ridge, Lombard, Oakbrook Terrace, Vernon Hills, Westmont, Libertyville and Frankfort. Most locations will operate under the company’s Regus brand. Two of the Chicago locations have already opened, and the rest are set to open sometime in 2024.

The company currently has 64 spots in Illinois, and over the last year added 600 locations — which includes 300 in the U.S.

The company’s strategy appears to be a departure from much of the traditional office industry, which has struggled with waning leases in city centers and coworking spaces in the heart of downtowns. WeWork’s locations have long been concentrated in major cities.

The plan appears to be paying off for IWG, which said the expansion was driven “by unprecedented demand for hybrid working solutions from both workers and companies.” 

The company said that with 40 percent of U.S. workers already on a hybrid model, more companies will need flexibility with leases and the type of offices they rent.

“Hybrid work is radically reshaping our cities, our suburbs and beyond,” Dixon said. “With a profound and lasting impact on the make-up of communities and the geography of towns, cities and the nation, the hybrid work model is one of the most important forces at play in the world today as workers increasingly embrace the opportunity to work from a local workspace.”

The announcement comes only weeks after WeWork, once the startup darling of the coworking industry, declared bankruptcy. Only one day later, Dixon confirmed to Reuters that IWG was exploring acquiring more of WeWork’s spaces.

IWG’s Planned New Illinois Coworking Locations for 2024: 

Property Address
IWG Brand
Opening Date

3455 W Salt Creek Ln, Arlington Heights
Regus
Q3 2024

4311 Ravenswood Dr, Chicago
Regus
Open

19 N Green St, Chicago
Regus
Open

401 N Franklin, Chicago
HQ
Q3 2024

5222 Main St, Downers Grove
Regus
Q2 2024

2250 Point Blvd, Elgin
HQ
Q1 2024

7777 W Lincoln Highway, Frankfort
Regus
Q3 2024

611 S Milwaukee, Libertyville
Regus
Q2 2024

2525 Cabot Drive, Lisle
Regus
Q4 2024

4200 Commerce Ct, Lisle
Regus
Q2 2024

100 22nd St, Lombard
Regus
Q2 2024

1601 River Dr, Moline
HQ
On Hold

7000 Caton Farm Rd, Plainfield
Regus
Q3 2024

10 E 22nd St, Lombard
Regus
Q2 2024

3027 English Rows, Naperville
HQ
Q2 2024

17W240 22nd St, Oak Brook Terrace
Regus
Q2 2024

999 Oakmont Plaza Dr, Westmont
Regus
Q1 2024

350 S Northwest Highway, Park Ridge
Signature
On Hold

416 Main St., Peoria
Regus
Q1 2024

300 Cardinal Drive, St. Charles
Regus
Q2 2024

544 Lakeview Pkwy, Vernon Hills
Regus
Q2 2024

Read more

The post IWG expands into 21 more Illinois coworking spaces appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Coworking, Office Market, Suburban Chicago Shared workspace provider IWG is doubling down on plans for expansion in the Chicago area and throughout Illinois, despite ongoing challenges for the coworking model and a rough office market harmed by hybrid work schedules. The Switzerland-based coworking company is adding 21 locations in Illinois, nearly all in Chicago and its suburbs, the company announced
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D.R. Horton buys Palm Beach Gardens dev site for townhouse project – Robert Khodadadian

D.R Horton bought a 17.9-acre development site in Palm Beach Gardens for $9.4 million, after buying off opposition to its planned project earlier this year.

The Arlington, Texas-based homebuilder is planning a 111-townhome development for the site, according to plans filed with Palm Beach Gardens. Records show D.R. Horton acquired the land from Northlake 20 LLC, a Florida entity managed by Aldo and Carlo Basile. The entity bought the land for $1 million in 2004, records show. 

The planned development, dubbed “Vintage Oaks,” will have 111 townhomes, a clubhouse and a pool. Miami-based Boutros Bou-Nahra Architect designed the project, planning documents show. 

It is adjacent to Rustic Lakes, a community with properties ranging from 5 to 10 acres where some homeowners have agricultural operations and livestock. Community members fought the approval of Vintage Oaks, arguing it would not fit the character of the area.

“The majority of this community — I’m trying to find the right words — is dead set against it,” Rustic Lakes resident Vanessa Saridakis said at a planning meeting, according to OnGardens. 

D.R. Horton agreed to pay the Rustic Lakes homeowner’s association $650,000 in July, and its residents dropped their opposition, the outlet reported. 

Representatives for the developer did not immediately respond to a request for comment on the site acquisition. D.R. Horton, one of the nation’s largest homebuilders, is led by CEO Paul Romanowski, the company’s former co-COO who succeeded David Auld in September. Earlier this month, a San Antonio-based civil rights group sued the firm along with Miami-based Lennar, alleging housing discrimination against individuals with disabilities. 

While the suit plays out in civil court in Texas, Vintage Oaks isn’t the only South Florida project in D.R. Horton’s pipeline. The homebuilder is planning an 86-home community in a former fruit tree nursery in Davie. Also, in September of last year, the firm won the rezoning for its planned Hunter Manor development, which will have 59 single-family homes in Pompano Beach. And in July of last year, Kolter Group dropped $36.9 million on a West Palm Beach development site, where D.R. Horton will build a 707-home community called “Reflection Bay.”

The post D.R. Horton buys Palm Beach Gardens dev site for townhouse project appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, D.R. Horton, Dev Sites, Homebuilders, Palm Beach County, Palm Beach Gardens, Townhomes, Townhouses D.R Horton bought a 17.9-acre development site in Palm Beach Gardens for $9.4 million, after buying off opposition to its planned project earlier this year. The Arlington, Texas-based homebuilder is planning a 111-townhome development for the site, according to plans filed with Palm Beach Gardens. Records show D.R. Horton acquired the land from Northlake 20
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Munger on real estate: Rare insights, comic relief – Robert Khodadadian

Billionaire investor, second in command to the Oracle of Omaha, and would-be dorm designer Charlie Munger passed away yesterday at the age of 99. 

Though Munger made his billions as an independent investor, serving for years as Warren Buffett’s right hand, he got his start in the real estate industry. 

After finishing law school at Harvard, Munger moved to California, where he became a real estate attorney, and soon got involved in development deals of his own. He did only five deals before getting out of the industry and heading to work with Buffett, but he left plenty of sage advice about real estate, investing, architecture, and business.

Check out a few of our favorite Munger quotes below. 

“A lot of real estate isn’t so good any more. … There’s a lot of agony out there.” –to the Financial Times in an April interview 

“There’s no real controversy. We just had a couple of nutcases that went off half-cocked.” –on critiques of his dorm design at UC Santa Barbara in a 2021 interview with The Real Deal 

“Lush landscaping. That’s what sells. You spend money on trees, and you get back triple.” –to Janet Lowe for his 2003 biography Damn Right! 

“Here’s an area in which we have a virtually perfect record extending over many decades: we’ve been demonstrably foolish in almost every operation having to do with real estate that we’ve ever touched.” –to Berkshire Hathaway shareholders in the 1998 annual meeting 

“I did a total of five projects, then stopped. I didn’t like constantly borrowing more money.” –from Damn Right! on why he got out of the real estate game 

“I regard architecture as the queen of the arts. Think of how much more good one nice building does for humanity than one damn painting.” –to The Real Deal in a 2021 interview

“I never had any flannel-mouthed baloney in the operation. I dealt with quality people.” –on picking the right partners for his deals, in Damn Right! 

“Forget what you know about buying fair businesses at wonderful prices; instead, buy wonderful businesses at fair prices.” –Munger quoted by Warren Buffett in his 2014 letter to Berkshire Hathaway shareholders

“I developed it because I didn’t want to let the zoning authorities rob me the way they wanted to. And now I know that if I had let them rob me, we would have had better financial results.” –on his pricey Santa Barbara development, in Damn Right! 

“What kind of idiot would make the men’s bathroom and the women’s bathroom the same size? The answer is, a normal architect!” –to the Wall Street Journal in 2019

“It’s remarkable how much long-term advantage people like us have gotten by trying to be consistently not stupid, instead of trying to be very intelligent.” –in Damn Right! 

“If you think psychology is badly taught in America, you should look at corporate finance. Modern portfolio theory? It’s demented!” –in Damn Right! 

The post Munger on real estate: Rare insights, comic relief appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized Billionaire investor, second in command to the Oracle of Omaha, and would-be dorm designer Charlie Munger passed away yesterday at the age of 99.  Though Munger made his billions as an independent investor, serving for years as Warren Buffett’s right hand, he got his start in the real estate industry.  After finishing law school at
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[solidcore] founder Anne Mahlum buys Pinecrest spec mansion for record $11.3M – Robert Khodadadian

This Pilates mogul built a fortune with her army of Lululemon-clad devotees, and now she’s buying a slice of South Florida.

Anne Mahlum, the founder and former CEO of Pilates giant [solidcore], bought a Pinecrest spec mansion for a record $11.3 million, listing agent Cristina Ramirez confirmed.

Mahlum and her fiancé, Brett Eaton, bought the home at 11755 Southwest 68th Court from an affiliate of Casa K Group, a Miami-based spec developer led by Orli Krajewski and Eduardo Krajewski. 

Ramirez of Florida Realty of Miami represented the sellers, and Chad Carroll of Compass brought the buyers.

Mahlum founded [solidcore] in 2013 in Washington, D.C. and grew the Pilates operation to 99 studios across the country. She sold her ownership stake in the company in April to venture capital firm Kohlberg & Company for an undisclosed amount, according to published reports. 

Her fiancé, Eaton, is a life coach and former director of personal training at Gold’s Gym, according to LinkedIn. He proposed to her in September on a visit to the Pinecrest house, Ramirez confirmed. 

The spec developers bought the 1-acre estate for $1.3 million in 2020, records show. They tore down the existing home, and built a 9,400-square-foot mansion with eight bedrooms, nine bathrooms and two half-bathrooms, the listing shows. Completed this year, the mansion has a gym, a theater, two laundry rooms, service quarters and a pool. Mahlum and Eaton also requested the developers add a sand volleyball court, according to Ramirez.

Luxury buyers are looking for highly amenitized, newly constructed single-family homes in Pinecrest, Ramirez said. 

“That is what this type of client wants,” she said. “They want comfort, and they want everything to be practical.”

Karim Bayzid’s Norway Builders constructed the home and Re+Forma led design, according to Casa K’s website. 

The developers listed the mansion for $13.5 million in July, Redfin shows. The sale marks the fifth residential price record set in Pinecrest this year and surpasses the previous record $11.2 million spec mansion that sold in October. Baseball star David “Big Papi” Ortiz clinched an earlier record title in June when he sold his mansion for $10.6 million, trumping the record set by the Miami Heat’s Tyler Herro in December when he bought a home for $10.5 million. 

Pinecrest is a popular enclave among professional athletes. Other Heat players, including Jimmy Butler, Dion Waiters, James Johnson, and Penny Hardaway have called the neighborhood home over the years. 

Ramirez said she sees the Pinecrest market sustaining demand and maintaining its recent price growth. 

“If someone else breaks [the price record] next week, we’ll be ecstatic about it,” she said. 

The post [solidcore] founder Anne Mahlum buys Pinecrest spec mansion for record $11.3M appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Home Sales, Luxury Real Estate, Miami-Dade County, Pinecrest, Records This Pilates mogul built a fortune with her army of Lululemon-clad devotees, and now she’s buying a slice of South Florida. Anne Mahlum, the founder and former CEO of Pilates giant [solidcore], bought a Pinecrest spec mansion for a record $11.3 million, listing agent Cristina Ramirez confirmed. Mahlum and her fiancé, Brett Eaton, bought the
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Morgan plans 452-unit multifamily project in Sunrise – Robert Khodadadian

Morgan Group won city approval for a 452-unit multifamily development in Sunrise.

The Houston-based multifamily developer won approval earlier this month of a site plan for the low-rise apartment and townhouse complex, called Caroline at Sunrise, as well as a rezoning of the 21-acre development site.

Two companies own the site and are partners with Morgan Group in the development of Caroline at Sunrise, said Aventura-based Lauren Iaslovits, who manages one of the companies.

Rendering of plans for the development in Sunrise (Morgan Group)

The owners of the site on the southwest corner of North Pine Island Drive and West Oakland Park Boulevard are 3363 Pine Island, LLC, and Humbold 18, LLC, according to Morgan’s rezoning application.

Steve Flasz of Hallandale Beach manages 3363 Pine Island, which owns a large eastern swath of the development site that includes a former ice rink that was called Sunrise Ice Chalet. His company paid $3.9 million in 2019 for the former ice-skating property at 3363 North Pine Island Road in Sunrise, according to county property records.

Iaslovits, manager of Humbold 18, told The Real Deal that the total price the two companies paid in 2019 for the Caroline at Sunrise development site, including the old ice rink, was about $13 million.

The Sunrise City Commission rezoned the development site on Nov. 14 from “general business district” (B-3) to “planned unit development” (PUD) and approved a 14-building site plan for Caroline at Sunrise.

Rendering of plans for the development in Sunrise (Morgan Group)

Morgan agreed to reserve 15 percent of the residential units, which equates to 68 units, as affordable housing with below-market rents for moderate-income tenants, as defined in the Broward County Comprehensive Plan.

Other conditions of the rezoning include Morgan’s agreement to pay $150,000 to upgrade a nearby bus stop with a bus shelter design, and to build a seven-foot wall on the west side of the development site, next to a cluster of single-family homes.

The development is designed as eight four-story apartment buildings with 412 units, and six three-story townhouse buildings with 40 townhouses. The townhouses would range in size up to 2,358 square feet.

The apartment section of the development would include 35 three-bedroom units, each with about 1,400 square feet, along with 219 two-bedroom units ranging from 1,088 square feet to 1,275 square feet, and 158 one-bedrooms ranging up to 759 square feet.

Amenities will include a swimming pool with cabanas, a clubhouse with a gym and resident business center, a pocket park, a tot lot and a dog park. An outdoor kitchen and seating area is planned in the townhouse section.

Family owned Morgan is led by Chairman Michael Morgan and CEO Philip Morgan, and has built or acquired over $4.5 billion of multifamily assets with over 23,000 units, according to its website. Its current portfolio includes more than 17,000 units in Texas, California, Arizona, Colorado, Missouri and Florida. In addition to its Houston headquarters, the firm has regional offices in Austin, Denver, Dallas and Miami.

The post Morgan plans 452-unit multifamily project in Sunrise appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Affordable Housing, Broward County, Multifamily, South Florida Multifamily Market, Sunrise, Townhomes, Townhouses Morgan Group won city approval for a 452-unit multifamily development in Sunrise. The Houston-based multifamily developer won approval earlier this month of a site plan for the low-rise apartment and townhouse complex, called Caroline at Sunrise, as well as a rezoning of the 21-acre development site. Two companies own the site and are partners with
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Sierra Club sees California Forever as “hostile takeover” of farm land – Robert Khodadadian

A cabal of billionaires has proposed a hostile takeover of Solano County to build a tech-utopian city that would upend years of local and regional growth planning.

That’s the conclusion of the Sierra Club, which has vowed to fight the California Forever development backed by Silicon Valley billionaires who secretly bought up tens of thousands of acres for a new city near Travis Air Force Base, the San Francisco Standard reported.

Ahead of town halls planned this week by Folsom-based Flannery Associates across Solano County on its California Forever plan, the Oakland-based environmental group said it would lay out terms of its opposition.

In a press release, The Sierra Club described Flannery as “a cabal of billionaires.” 

The environmental advocate said the group’s efforts to secretly buy up 55,000 acres of land threaten to undo years of local and regional growth planning.

“Ignoring the current voter-approved uses of land that Flannery has acquired in order to jack their investment’s economic return is nothing short of a hostile takeover,” said Suisun City Vice Mayor and Sierra Club Solano Group Chair Princess Washington. 

“These land use rules have allowed for a harmonious relationship of agricultural uses and open space with the urban environment of the seven existing cities in Solano County,” Washington added. 

The land, including 78 square miles between San Francisco and Sacramento, was purchased under the corporate name Flannery Associates. 

Seven Bay Area billionaires spent $800 million to buy up the farmland in the hopes of transforming it into a modern metropolis. Flannery launched a website touting the venture, which said the project’s parent company is called California Forever.

Former investment banker Jan Sramek spearheaded the land acquisition beginning in 2017. 

An elite group of tech entrepreneurs and investors joined, including Andreessen Horowitz partners Marc Andreessen and Chris Dixon, LinkedIn co-founder Reid Hoffman, Stripe co-founders Patrick and John Collison, billionaire philanthropist Laurene Powell Jobs and Michael Moritz, formerly of Sequoia Capital and now chairman of The San Francisco Standard.

They aim to support a city-of-the-future complete with retro-style row houses that would be more affordable than other Bay Area homes.

Sramek wants to put the controversial city on the November 2024 ballot.

“With respect to these project opponents, who made up their minds before ever seeing details of the project, they are entitled to their own opinions — but not their own ‘facts,’” Sramek told the Standard. 

“By giving voters the final say, this project explicitly adheres to the Orderly Growth Initiative, by asking Solano voters whether they want to turn an area with the least productive and least ecologically valuable soils in all of Solano County into a new economic engine for the county,” he said.

But Joe Feller, a board member for the Sierra Club’s Redwood Chapter and Solano Group, said it sees California Forever “a distinct violation” of the county’s orderly growth initiative and pointed to its previous renewals by voters since 1984. 

“We do not see any advantages to the project,” Feller told the newspaper. “The only thing we see is billionaires getting richer. That’s all we see.”

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The post Sierra Club sees California Forever as “hostile takeover” of farm land appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized A cabal of billionaires has proposed a hostile takeover of Solano County to build a tech-utopian city that would upend years of local and regional growth planning. That’s the conclusion of the Sierra Club, which has vowed to fight the California Forever development backed by Silicon Valley billionaires who secretly bought up tens of thousands
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Airbnb operators in LA will need permits from the police – Robert Khodadadian

Los Angeles landlords of Airbnb rentals must now report to the local police station.

The L.A. City Council has approved a law requiring hosts of short-term rentals, including Airbnbs and hotels, to obtain a police permit, the Los Angeles Times reported.

Backers, including Council President Paul Krekorian, said the permit requirement will help the city crack down on party houses and rental properties that draw crime.

It will also create more red tape for short-term rental and hotel operators, allowing the City Council and neighborhoods to challenge the issuance of the permits.

Dozens of businesses, including car valet operators, antique stores and bowling alleys already require a police permit to operate in the city.

Many permits require criminal background checks and fees costing hundreds of dollars.

A recent report by the Los Angeles Police Department suggested initial fees of $260 for short-term rental operators. Krekorian said the fees haven’t been finalized and that he’s hopeful the background check can be done without fingerprinting.

“My goal is to make [obtaining a police permit] as easy and painless and nearly automatic as I can,” Krekorian told the Times. “The idea will be that if someone applies for it, unless there’s some complaint from someone, that it would be routinely granted.”

There are 6,725 short-term rental units listed with the city, according to the Planning Department. Under the new law, the police permit would be issued to the operator of the short-term rental unit. 

Several Airbnb hosts expressed alarm about the proposal at a council committee hearing last week, calling the requirement of a police permit excessive and saying they don’t want to be fingerprinted as part of a criminal background check. Others questioned the price of the permits.

“I just ask that you not buckle us in with doing extra hoops to jump through and extra police checks and extra fees,” Kevin Stevens, a homeowner in North Hollywood, told the council.

Airbnb on Monday declined to weigh in on the proposal.

Peter Hillan, a spokesperson for the Hotel Association of Los Angeles, said he didn’t know how many of the association’s 600 members already have police permits, but said the group is “concerned” about the requirement.

Hillan also questioned whether the LAPD has enough staff to oversee the additional permits.

The police permit requirement was part of a package of regulations targeting new hotels that was announced earlier this month. The regulations are a compromise between the city and hotel workers union, which initially sought to force a ballot measure vote related to hotel rooms and the housing of homeless residents. 

New hotels must now go through a more extensive approval process. Hotel developers are also now required to replace any homes demolished to make way for their projects with new residential units, or by buying and renovating existing ones.

— Dana Bartholomew

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The post Airbnb operators in LA will need permits from the police appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, police permits Los Angeles landlords of Airbnb rentals must now report to the local police station. The L.A. City Council has approved a law requiring hosts of short-term rentals, including Airbnbs and hotels, to obtain a police permit, the Los Angeles Times reported. Backers, including Council President Paul Krekorian, said the permit requirement will help the city
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Congressman urges Letitia James to investigate RealPage – Robert Khodadadian

RealPage’s legal woes keep piling up.

Rep. Daniel Goldman, the Democratic congressman from New York’s 10th District, in a letter asked Attorney General Letitia James to look into the proptech company, according to Gothamist. Goldman took aim at the company’s algorithms, which sets price recommendations for landlords and property managers and has been scrutinized for price fixing. 

“There is clearly broad interest in holding bad actors accountable for using anticompetitive practices in the rental market,” Goldman said in his letter, Gothamist reported. “Their abhorrent behavior favors profits over affordability for the many low- and moderate-income families in our cities and neighborhoods desperate for reasonably priced housing.”

James’ office told Gothamist that Goldman’s letter is being reviewed. RealPage did not respond to a request for comment from the news outlet. 

RealPage recommends landlords keep apartments empty to increase demand and prices, according to a ProPublica investigation cited by Gothamist. 

Lawsuits have been filed against the proptech company by Washington D.C. Attorney General Brian Schwalb, as well as tenants across the country who have support from the Department of Justice. They accuse RealPage of allowing landlords to conspire to inflate rents, in violation of antitrust laws. 

Goldman, a former federal prosecutor, said RealPage’s rent-setting tool is contributing to record-high housing costs in New York City. 

The company’s “unprecedented access to public and private landlord data in New York City … facilitates pricing collusion and eliminates traditional market competition,” Goldman states in his letter. 

Last year, 17 members of Congress, including Rep. Alexandria Ocasio-Cortez, urged the Federal Trade Commission and Department of Justice to investigate RealPage, comparing the company’s business strategy and data sharing practices to a “cartel.” 

A federal judge earlier this year allowed tenants from different states to consolidate their lawsuit against RealPage into a class action challenge. The DOJ this month asked the judge to deny RealPage’s motion to dismiss the case. 

— Harrison Connery

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The post Congressman urges Letitia James to investigate RealPage appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Lawsuit, Residential Real Estate RealPage’s legal woes keep piling up. Rep. Daniel Goldman, the Democratic congressman from New York’s 10th District, in a letter asked Attorney General Letitia James to look into the proptech company, according to Gothamist. Goldman took aim at the company’s algorithms, which sets price recommendations for landlords and property managers and has been scrutinized for
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Aareal moves to foreclose Meringoff’s Soho property – Robert Khodadadian

Things are getting real at Meringoff Properties’ Soho property after lender Aareal Bank filed a foreclosure action claiming two unpaid mortgages. 

The German bank filed its case in Manhattan Supreme Court last week, Crain’s reported. The lender is looking to seize control of the 171,000-square-foot property at 462 Broadway, owned by an affiliate of Meringoff Properties.

Meringoff defaulted in May on a pair of mortgages with a principal balance of $149.3 million, the bank claims in the lawsuit.

Aareal made two loans to Meringoff in June 2016 for a combined $135 million, consolidated years later into a single mortgage with the same principal balance. Last May, Aareal loaned another $14.3 million to Meringoff, which had filed permit applications for the addition of a roof terrace.

A year later, Meringoff defaulted on both loans after failing to obtain insurance for the consolidated $135 million mortgage, according to the suit. Aareal claims Meringoff failed to make payments in the months leading up to the default.

Aareal wants the court to appoint a receiver to collect rents and profits before any auction of the property. It also wants the ability to bid on the building using its outstanding debt.

An attorney representing Aareal and Meringoff both did not respond to Crain’s requests for comments. Meringoff also did not immediately respond to a request for comment from The Real Deal.

Meringoff acquired the office and retail property as part of a $3.7 million portfolio purchase in 1995, according to CoStar. Meringoff renovated the 19th century building in 2018 and has kept it occupied, boasting a 100 percent leasing rate as of Monday, according to CoStar. Software firms Centrical and Coro Cybersecurity are among the building’s tenants.

The building is the largest cast-iron structure in Soho, according to PBDW Architects.

— Holden Walter-Warner

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The post Aareal moves to foreclose Meringoff’s Soho property appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Foreclosure, Real Estate Lawsuits Things are getting real at Meringoff Properties’ Soho property after lender Aareal Bank filed a foreclosure action claiming two unpaid mortgages.  The German bank filed its case in Manhattan Supreme Court last week, Crain’s reported. The lender is looking to seize control of the 171,000-square-foot property at 462 Broadway, owned by an affiliate of Meringoff
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Acclaim wields builder’s remedy in Cupertino for 140-plus apartments – Robert Khodadadian

Acclaim Companies will use the builder’s remedy to gain approval for 141 apartments in Cupertino.

The Menlo Park-based developer has used the state housing loophole to file plans for a five-story complex at 20015 Stevens Creek Boulevard, the San Jose Mercury News reported. It would raze three commercial buildings for the project.

The 30-year-old provision in state housing law allows a streamlined approval if a city or county hasn’t certified its required state housing plan. The builder’s remedy, untested in the courts, allows developers that include at least 20 percent affordable housing to skirt local zoning rules.

Plans by Acclaim call for 141 apartments, including the required 20 percent affordable units, and two levels of underground parking. The development is estimated to be 70 feet tall, which is 25 feet higher than what the lot is zoned for.

Some developers have used the builder’s remedy to push through projects that would otherwise not be approved — like a more than 300-foot tower proposed among single-family homes and smaller apartment buildings in Menlo Park.

But Cupertino Councilman J.R. Fruen said Acclaim’s project is “largely consonant” with what people already see on Stevens Creek Boulevard.

“The thing that I think is most interesting here and one might have expected given the previous hostility or perceived hostility of Cupertino to housing developers is we would be getting lots of builder’s remedy projects in the city,” Fruen told the Mercury News. “That isn’t happening.”

He said city staff knew the city’s buildable sites were insufficient, according to the California Department of Housing & Community Development. 

So the staff reached out to developers that might otherwise have been interested in making builder’s remedy applications and have instead folded those sites into the Housing Element plan.

It’s what Fruen calls a “win-win.” Cupertino identifies another location to build housing so that it will be in compliance with state law, and the developer gets its project built.

Mayor Hung Wei told The Mercury News that five stories on one of the city’s busiest thoroughfares isn’t unusual. And while there may not be any other buildings of that height nearby at the moment, she said there will be more in the next eight years.

Wei said that while the community may be upset about the builder’s remedy, city officials have been working with the developer to ensure the sections closest to single-family homes won’t be as tall.

“I’m for local control but local control means that we want to be a community that is welcoming, that doesn’t exclude people,” Wei told the Mercury News. “Anybody who comes with a builder’s remedy project, the staff needs to work really close with them and to make sure the design is reasonable, rational and takes care of the neighbors.”

Cupertino is one of many Bay Area cities yet to have its Housing Element approved after missing the Jan. 31 deadline. The state requires a plan to build 4,588 homes by 2031, including nearly 1,900 units for low- and very low-income households.

— Dana Bartholomew

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The post Acclaim wields builder’s remedy in Cupertino for 140-plus apartments appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Builder’s Remedy Acclaim Companies will use the builder’s remedy to gain approval for 141 apartments in Cupertino. The Menlo Park-based developer has used the state housing loophole to file plans for a five-story complex at 20015 Stevens Creek Boulevard, the San Jose Mercury News reported. It would raze three commercial buildings for the project. The 30-year-old provision
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Embrey takes built-to-rent bite in Fort Worth – Robert Khodadadian

A San Antonio developer has big plans for built-to-rent in North Fort Worth.

Embrey Partners plans to build 116 duplexes in the Hunters Crossroads development, west of Haslet, near U.S. Highway 287, the Dallas Morning News reported.

The project, Hunters Crossroads Avondale, is estimated to cost $42 million, according to a filing with the state of Texas. That works out to more than $362,000 per unit.

Construction could start in January and take about two years. Houston-based W Partnership is the architect.

Also in North Fort Worth, Embrey is planning to build 276 duplexes on 23 acres off of State Highway 114, near the Texas Motor Speedway, the outlet said. The cost wasn’t reported.

That development, called Collections Champion Circle, will have one-, two- and three-bedroom units starting at $1,800 a month. It will also have a clubhouse and a pool.

Multiple built-to-rent communities are in the pipeline in Dallas-Fort Worth. 

Good + West Residential has plans to invest $400 million building four built-to-rent communities in DFW under its Perch brand, including the 319-unit Perch Chisholm Trail in Fort Worth, according to the firm’s website. 

Grapevine-based HistoryMaker Homes and Arizona-based Empire Group of Companies also are planning built-to-rent developments in Fort Worth.

Like many built-to-rent developers, Embrey started as an apartment developer, and it dove into built-to-rent in 2021. Embrey completed a $160 million discretionary equity fund last year to support development of a built-to-rent portfolio.

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It has developed more than 43,000 apartments since it was founded in 1974, including communities in Frisco, North Dallas and Richardson, the outlet said. The firm has several thousand rental units planned in Texas, Arizona, Colorado, Florida and North Carolina. It is also developing a built-to-rent community in Gruene, near San Antonio. 

Developers built 2,773 built-to-rent units in DFW last year, according to Yardi Matrix, more than anywhere else in the country.  

The post Embrey takes built-to-rent bite in Fort Worth appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Built-to-rent, duplex, Fort Worth, Texas A San Antonio developer has big plans for built-to-rent in North Fort Worth. Embrey Partners plans to build 116 duplexes in the Hunters Crossroads development, west of Haslet, near U.S. Highway 287, the Dallas Morning News reported. The project, Hunters Crossroads Avondale, is estimated to cost $42 million, according to a filing with the state
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FMB Development apartment project in Van Nuys declares bankruptcy – Robert Khodadadian

It started with a plan, and ended in bankruptcy. 

After FMB Development defaulted on a loan tied to an apartment project in Van Nuys last month, the firm has opted to file for bankruptcy on the development. 

An entity controlled by Ilan Kelig’s FMB filed for Chapter 11 protection to resolve debt tied to a 180-unit complex at 7111 North Sepulveda Boulevard, according to a bankruptcy petition. Kelig did not respond to a request for comment. 

The project has between $10 million and $50 million in liabilities, according to the petition, and between $1 million and $10 million in assets. 

FMB has owned the land since 2018, when it paid $9.5 million for the roughly 1-acre site, according to property records. It planned a six-story apartment building with ground-floor retail. 

In 2021, FMB scored three loans for the project — $2 million in debt from three individuals, Heng Li, Jie Li and Ning Jiang; $2.6 million from Tel Aviv-based entity Marom Kislev Two; and $8 million from Lone Oak Fund. But construction never seemed to start. 

By August, FMB had defaulted on all three loans, owing a total of $15 million to the lenders, according to default notices filed with L.A. County. 

FMB listed all three lender groups as creditors in its bankruptcy filing. It also lists RTI Properties, a hard money lender in Los Angeles, as a creditor with a roughly $2.5 million claim.

The Van Nuys project is not the only one FMB has defaulted on. 

Last month, a notice of default was filed on FMB’s apartment development at 1317 South Hope Street in Downtown L.A., records show. 

The post FMB Development apartment project in Van Nuys declares bankruptcy appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Bankruptcy, Defaults, Development, Distress, LA Multifamily It started with a plan, and ended in bankruptcy.  After FMB Development defaulted on a loan tied to an apartment project in Van Nuys last month, the firm has opted to file for bankruptcy on the development.  An entity controlled by Ilan Kelig’s FMB filed for Chapter 11 protection to resolve debt tied to a
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Leser, Horizon Group bet on Kips Bay condos – Robert Khodadadian

Here come the condos.

Horizon Group and Leser Group recently filed their offering plan for the $105 million, 65-unit condo at 609 Second Avenue with the New York Attorney General. The 18-story building topped off this summer, according to New York YIMBY. If sold out, the average price per condo breaks down to $1.6 million.

PincusCo first reported the news. 

Higher interest rates are curbing New York condo sales. In October, sales of newly constructed condominium units fell to below pre-pandemic levels for the second consecutive month, according to Marketproof. At the same time, an uptick in inventory is likely: With the expiration of the property tax break 421a, developers will be more likely to build condos than rentals.

Developer Abraham Leser, a longtime player in Brooklyn real estate, bought tenements at the site in 2014 for $26.5 million. Leser purchased the four buildings at 609, 611, 613 and 615 Second Avenue from infamous art dealer Ely Sakhai. 

Leser teamed up with David Marom’s Horizon Group and demolished the buildings. The developers filed plans for a 30-unit residential building on Second Avenue. The plans were modified to build a 66,552-square-foot building with 65 units.

Horizon and Leser secured a $58 million construction loan from Ponce Bank earlier this year, according to property records.

Fischer + Makooi Architect designed the 18-story project, which stands out for its curved black brick balconies and copper-look walls. 

The Leser Group was founded by Abraham Leser in the 1980s and has developed at least 30 projects with a total cost of $886 million, but has kept a low profile. Last year, the firm scored a $202 million construction loan for a commercial development in Bedford–Stuyvesant.

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The post Leser, Horizon Group bet on Kips Bay condos appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Commercial Real Estate, Condos, Leser Grkmx c, Manhattan, zoup Here come the condos. Horizon Group and Leser Group recently filed their offering plan for the $105 million, 65-unit condo at 609 Second Avenue with the New York Attorney General. The 18-story building topped off this summer, according to New York YIMBY. If sold out, the average price per condo breaks down to $1.6 million.
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UC Irvine economist thinks Federal Reserve misread rent inflation – Robert Khodadadian

The Federal Reserve should halt future interest rate hikes to stem inflation because the nation’s rent increases have already leveled off.

That’s the conclusion of Ed Coulson, director of the Center for Real Estate at UC Irvine, who believes the Fed waited too long to hike rates until a year after rents soared into the double digits in 2021, the Orange County Register reported.

Rent inflation plays an outsized role in determining the overall rate of inflation, the housing economist said. And the government’s method for measuring it is off, causing the Fed to misinterpret an important metric in the Consumer Price Index.

“The Fed’s policy is driven by their perceptions of inflation,” Coulson told the newspaper in a question-and-answer interview. “And I argue with some co-authors that that perception is incorrect.

“And the reason it’s incorrect, ironically, has to do with the housing market.”

The problem, Coulson said, is that rent is the biggest component of the Consumer Price Index. Rent is weighted to take up 30 to 45 percent, depending on which measure of inflation is used.

One issue with assessing the inflationary cost of rent is that current rents are based on leases signed six, eight, or 10 months ago, he said. 

“So, it is very sluggish and lags the true state of the housing market by six months at least,” Coulson said.

If the Fed had measured inflation properly, Coulson added, it probably would have raised rates much sooner. And it should stop raising interest rates now because rents have leveled off. 

In fact, the nation’s measure of current rental inflation is zero — when the Fed still measures it at 3 to 4 percent.

Asked if rent inflation should be based on new leases for vacant units, the economics professor at the Paul Merage School of Business said: “That’s what you want.

“We have a more recent technique, which simply takes Real Capital Analytics data on the multifamily market, and we can convert that into an apartment rent inflation index,” Coulson told the Register. “And if you input that into the CPI and take out the Fed’s rental measure, it shows a drop in the rental inflation rate.”

— Dana Bartholomew

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The post UC Irvine economist thinks Federal Reserve misread rent inflation appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Federal Reserve, Inflation, Interest Rates, rent increases The Federal Reserve should halt future interest rate hikes to stem inflation because the nation’s rent increases have already leveled off. That’s the conclusion of Ed Coulson, director of the Center for Real Estate at UC Irvine, who believes the Fed waited too long to hike rates until a year after rents soared into the
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JVM dishes out $30M for Des Plaines apartments  – Robert Khodadadian

JVM Realty has snagged another luxury apartment complex in Des Plaines, highlighting investors’ appetites for multifamily properties across Chicago’s suburbs despite a down year for commercial real estate transactions.

The Oak Brook-based firm, led by CEO Jay Madary, paid more than $30 million for the 113-unit Ellison Apartments at 1555 Ellinwood Street, northwest of Chicago, Crain’s reported. That’s about $268,000 per unit.

The seller was Boston-based Berkshire Residential, which put the property on the market in September 2022. The transaction, brokered by CBRE’s John Jaeger, marks the first time the complex has changed hands since it was built in 2019. 

“Ellison Apartments is a rare find, in that it features an exclusive, boutique multifamily property in a high-demand, strategic location,” Madary told the outlet.

The Chicago area’s multifamily sector continues to thrive, as exemplified by the Ellison’s occupancy rate of 97 percent, with monthly rents ranging from $1,880 for a studio to $2,877 for a two-bedroom unit. However, the property’s occupancy rate is a tad below the average in the nearly full Des Plaines-Arlington Heights submarket, while rents are a notch above the area average.

Despite steadily rising rents and strong apartment demand in Chicagoland, there’s been a slowdown in sales amid rising interest rates, a tough lending climate and economic uncertainty. Nationwide, apartment sales were down 64 percent year-over-year in October, the outlet reported.

Market challenges haven’t stopped JVM, though, as the firm also acquired a 297-unit property in nearby Itasca for almost $99 million last year. It also picked up a 240-unit Romeoville apartment complex nearly a year ago for $72 million, and then doubled down with the purchase of the 149-unit Courthouse Square property in suburban Wheaton.

The largest suburban Chicago multifamily deal this year was Nuveen’s $103 million purchase of the 336-unit Oaks of Vernon Hills. The second-priciest deal happened in September, when Trinity Property Consultants paid $96 million for the 558-unit Westmont Village apartments. 

— Quinn Donoghue 

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The post JVM dishes out $30M for Des Plaines apartments  appeared first on The Real Deal.

Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Apartments, Sale, Suburbs JVM Realty has snagged another luxury apartment complex in Des Plaines, highlighting investors’ appetites for multifamily properties across Chicago’s suburbs despite a down year for commercial real estate transactions. The Oak Brook-based firm, led by CEO Jay Madary, paid more than $30 million for the 113-unit Ellison Apartments at 1555 Ellinwood Street, northwest of Chicago,
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Federal government falls short of return-to-office goals – Robert Khodadadian

The real estate industry put its hopes in the federal government to pace a return-to-office movement. Landlords seem unlikely to hold it up as an example for others, though.

The federal government’s own push to bring workers back to the office has fallen short of its goals, the Wall Street Journal reported. The failure comes despite several pleas to bring government workers back, including a letter sent to cabinet agencies in August.

“We still have work to do,” a spokesperson for Joe Biden’s administration said regarding office returns.

The Government Accountability Office recently conducted a review of two dozen federal agencies, taking a three-week sampling of occupancy at agency headquarters. An estimated 17 agencies — more than two-thirds — used no more than a quarter of their headquarters’ capacities during that span.

Washington, D.C. is feeling the brunt of federal office workers’ absences. About 270,000 people in the nation’s capital are employed by the federal government, but the district’s office vacancy rate hit 20.3 percent in the third quarter, according to Cushman & Wakefield, a record for the market.

Some agencies, such as the Department of Veteran Affairs and the U.S. Agency for International Development, have reached their workplace goals. Other agencies, including the Securities and Exchange Commission and the Patent and Trademark Office, moved in the opposite direction and vacated spaces upon lease expirations.

The costs of federal government office space are enormous. Agencies spend about $2 billion annually to operate its own buildings and another $5 billion to lease space from private landlords. Those expenses matter little to employees, who want to enjoy the perks given to private employees, including avoiding long commutes and having more hybrid work conveniences.

Even local governments appear to be having an easier time bringing back office workers, or at least are giving employees fewer opportunities to work remotely. Last month, roughly 71 percent of federal agencies offered hybrid policies compared to 59 percent of all government agencies, according to Scoop Technologies.

Republicans in Congress introduced legislation mandating federal employees return to their prepandemic schedules.

The General Services Administration manages upwards of 360 million square feet of office space across 8,000 properties.

— Holden Walter-Warner

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Lead by real estate veteran Robert Khodadadian, Skyline Properties has been instrumental in many multi-million dollar commercial developments, including a $12 million contract for the White House Hotel, a 99-year ground lease of a four-story commercial site in Harlem, and a retail co-op on Prince St. for $50 million.

Uncategorized, Office Leasing, Remote Work, Washington D.C. The real estate industry put its hopes in the federal government to pace a return-to-office movement. Landlords seem unlikely to hold it up as an example for others, though. The federal government’s own push to bring workers back to the office has fallen short of its goals, the Wall Street Journal reported. The failure comes
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