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Category ArchiveIntercontinental Real Estate Corporation

ACORE Lends $97M for JV Purchase of NJ Corporate Center

ACORE Capital provided $97 million to a joint venture of Rubenstein Partners and Vision Real Estate Partners (VREP) to facilitate the acquisition and capitalization of the Morris Corporate Center East & West in Parsippany, N.J., Commercial Observer can exclusively report.

Terms of the financing weren’t disclosed. The loan went towards the acquisition of one of the adjoined office buildings as well as to fund capital improvements aimed at adding amenities and attracting and leasing future tenants at the location.

The financing was arranged by Newmark Knight Frank’s Jordan Roeschlaub and Dustin Stolly, vice chairmen and co-heads of the firm’s debt and structured finance division, along with Managing Director Nick Scribani, sources told CO. NKF declined to comment on the transaction.

morriscorpcenter credit nkf 2 ACORE Lends $97M for JV Purchase of NJ Corporate Center
Entrance to Morris Corporate Center IV. Courtesy: Newmark Knight Frank

“Morris Corporate IV is the newest and highest quality asset within Morris Corporate Center. The superiority of the property, coupled with Rubenstein and Vision’s track record with office repositioning strategies, made this a great lending opportunity for ACORE,” ACORE Managing Director Jason Hernandez told CO. “ We are confident that we have best-in-class local sponsorship and a thoughtful, well-capitalized business plan to make the property the premier option for tenants (both large and small) in the market.”

NKF—out of it’s New Jersey office—also represented Intercontinental Real Estate Corporation and Ivy Realty in the sale of the property, which is also referred to as “Morris Corporate Center IV phase two.” Intercontinental and Ivy first purchased the building from MetLife in 2015, Globe Street reported in January.

Rubenstein and Vision purchased the other building in the assemblage—called “Morris Corporate Center IV phase one”—from SJP Properties, which is the original developer of the buildings, and Northwestern Mutual earlier this year. Cushman & Wakefield brokered the deal for the sellers and announced the transaction on February 28.

Built in 2000, according to the campus’ website, the two four-story office buildings are a combined 702,707 square feet and are situated at 389 & 399 Interpace Parkway within the Morris Corporate Center campus. The buildings are connected by a large, glass atrium lobby. “Morris Corporate Center IV phase one” is currently 71 percent occupied by four tenants, including U.K.-based Reckitt Benckiser and New Jersey-based management services company Skanska USA Building, Inc., according to information from C&W.

A spokeswoman for Rubenstein Partners did not immediately return a request for comment. Vision Real Estate Partners declined to comment on the deal.

Source: commercial

Intercontinental Bets Big on Burbank

Boston-based Intercontinental Real Estate Corporation, a national real estate investment, development and management firm, acquired Connexion Burbank for $123.5 million in mid-February, according to an official release.

Intercontinental’s purchase—on behalf of its managed fund U.S. Real Estate Investment Fund—includes a three-building urban campus totaling 337,904 square feet in downtown Burbank. It marks the fourth office investment and sixth overall investment for Intercontinental in the Los Angeles area. Previous office deals for Intercontinental were the Apollo at Rosecrans in El Segundo, Bristol 61 in Culver City and 6300 Wilshire in Miracle Mile.

Jessica Levin represented Intercontinental in-house. NKF Capital Markets’ Kevin Shannon, Rob Hannan, Michael Moll and Laura Stumm represented the seller—a joint venture between Lincoln Property Company and Angelo Gordon—along with Kent Handleman of Lincoln Property Company and Doug Marlow of CBRE.

Shannon told Commercial Observer that the property was attractive to Intercontinental Real Estate corporation because it provided newly renovated creative office product—a hot property type in Los Angeles—and the likelihood that it will benefit from the “Blackstone Effect” from Blackstone’s 2017 recapitalization of Jeff Worthe’s extensive Burbank portfolio. Between Blackstone’s “mini-monopoly” and a vacancy rate at less than 10 percent in the area (9.4 percent), Shannon said he expects market rents in Burbank to increase.

According to CBRE’s Greater Los Angeles office report from the fourth quarter 2017, asking rents in the Tri-Cities market, which includes Burbank, Pasadena and Glendale, average $3.04 a square foot.

The Connexion sale comes four months after Blackstone paid $1.7 billion for a majority ownership of six office properties totaling 3.3 million square feet in Burbank’s media district. Blackstone said it wanted to be in one of the key cradles of content creation, especially as big Web-based firms such as Amazon and YouTube’s owner, Google, are rapidly expanding their entertainment businesses.

Located at 303 North Glenoaks Boulevard, 333 North Glenoaks Boulevard and 300 East Magnolia Boulevard, the properties were built in 1983, 1978 and 1984, respectively. They recently underwent a major capital renovation and rebranding, which totaled nearly $8 million, and included an extensive plaza renovation, new common areas, significant upgrades to all three lobbies and the addition of two outdoor decks. The buildings are situated on just over three acres of land and provide direct access to an abundance of walkable amenities within downtown Burbank.

Collectively, Connexion Burbank is 91 percent occupied by a diverse set of tenants like Turner Broadcasting (Cartoon Network), Regus, Citibank, Blackmagic Design and University of Redlands.

“With a foundation of long term credit tenancies and a diverse mix of media/entertainment, legal, healthcare, government and non-profit firms, the property currently benefits from excellent proximity to a wide variety of amenities and a creative labor pool,” Levin said. “The building will continue to perform well due to its central location within downtown Burbank, and we expect it to outpace the market as a result of numerous development plans underway nearby.”

The business plan for the property includes minor updates to the lobby and other common areas of the building, she said, but declined to provide how much was earmarked for the purpose.

Source: commercial