National Market Report
The housing market in the Chicago metropolitan area remains “fragile” due to a large number of vacant homes, lengthy foreclosure processing times and “severely underwater” mortgages, the Chicago Tribune reported. According to a report last month from the U.S. Treasury Department, around 35 percent of Chicago’s home sales are distressed, compared to 34 percent in the nation as a whole. The average time needed to process a foreclosure in Illinois is 575 days, the Tribune said, compared to 348 days nationally, which causes delays in the Chicago market’s absorption of foreclosed properties. “The challenges in the diverse Chicago housing market have been more severe than those in most areas of the nation,” the report said.
The telecommunications company CenturyLink sold its headquarters at 1600 Seventh Avenue last month for $137 million, Commercial Property Executive reported. Clarion Partners, a New York–based real estate investment manager, bought the 598,000-square-foot, 32-story tower on behalf of an unnamed separate account investor. CenturyLink, formerly known as Qwest Communications, built the tower as its headquarters in 1976. CenturyLink will remain in its 260,000-square-foot office at the building, and much of the balance of the space will be occupied by the clothing retailer Nordstrom, which recently signed a 300,000-square-foot lease there and will be moving in this fall. Clarion, which manages over $1 billion in real estate assets in the metropolitan Seattle area, is planning a major renovation of the property’s retail space, lobby and common areas. Office leasing in the Seattle area has been relatively healthy, bolstered by large recent leases by Boeing and Amazon.com, CPE noted. The office vacancy rate in Seattle was 14.53 percent in the fourth quarter of 2011, down 3.03 percent for the year, according to a market report from the Broderick Group, a commercial brokerage.
Weingarten Realty Investors, a Houston-based real estate investment trust, is in contract to sell 52 industrial properties to New York City–based DRA Advisors for $382.4 million, the Boston Globe reported. Weingarten, which is looking to pay down a $200 million unsecured loan and other debts through the sale, has decided to exit the industrial real estate market entirely, the paper said. The deal should close in the next two months and includes properties in Florida, Georgia, Tennessee, Texas and Virginia, a spokesperson for the REIT told the Globe. The market for industrial properties has improved markedly in the last year as manufacturing has rebounded nationwide. Demand for Class A warehouse and distribution centers in major U.S. markets surged in the last quarter of 2011, according to published reports. Average vacancy rates in U.S. industrial markets are below 10 percent, and almost all of the nation’s largest industrial real estate markets recorded positive absorption results in the fourth quarter of 2011, according to data from brokerage Jones Lang LaSalle.
The $2.4 billion Revel casino and resort opened last month, the Wall Street Journal reported. The first new casino to open in Atlantic City since 2003, the 47-story Revel is also Atlantic City’s tallest. The city’s gambling revenue has fallen sharply in recent years, dropping to $3.3 billion from $5.2 billion in 2006, the Journal said. But Revel, and by extension New Jersey’s taxpayers, are betting on better times. Revel was rescued by the state after funding for the project’s construction evaporated during the recession. When original owner Morgan Stanley bailed out of the project, agreeing to take a $1.4 billion loss, New Jersey governor Chris Christie stepped up with a $261 million tax credit and a pledge to invest in the resort in the future, a move which drew some criticism. Revel, which has 1,399 rooms, features a rooftop botanical garden and a spa designed after the bathhouses of ancient Rome.
Madonna has listed her Beverly Hills home for $28 million, the RealEstalker blog first reported last month. The 5,800-square-foot property, which the singer bought for $12 million in 2003 while married to director Guy Ritchie, sits on 1.14 acres and includes a tennis court and swimming pool.
The Rockpoint Group sold the Parc 55 Wyndham hotel to the Blackstone Group for $235 million, or $231,984 per room, in a distressed sale, CoStar News reported last month. The 700,985-square-foot, 1,013-room hotel is located at 55 Cyril Magnin Street.
“Three’s Company” star Suzanne Somers has relisted her estate in Palm Springs, Calif., for $17.5 million, Curbed reported. The 65-acre spread first hit the market in 2008 for $35 million.
Compiled by Guelda Voien
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