- More Than $1 Trillion in Debt Maturities Loom. These Metros Have the Most Exposure. “All eyes are on mounting debt in the commercial real estate world, which continues to struggle with higher interest rates, a more cautious lending environment and muted return-to-office and leasing activity in the wake of the Covid-19 pandemic.” (Boston Business Journal)
- EQT Exeter Closes $4.9B Fund for Industrial Acquisitions “Private equity firm EQT Exeter has closed its latest fund, EQT Exeter Industrial Value Fund VI, at $4.9B, above its target of $4B. An earlier fund raised by the company closed at $2B. The fund will specialize in industrial assets in the United States, specifically logistics properties with single tenants, including fulfillment centers and last-mile delivery hubs. EQT Exeter said that investor interest in the fund was strong, and from a diversity of sources domestic and overseas, including pensions funds, foundations, insurance and sovereign wealth funds.” (Bisnow)
- Data Centers Proliferate Despite Global Roadblocks “This massive and growing demand for data storage has the private equity markets providing capital to fund construction of new data centers and expansion of existing ones. Demand from major users such as Amazon or Microsoft, Meta (Facebook), and Google are known in the industry as hyperscale operators. Mostly in obscure locations, these are massive facilities usually defined as exceeding 5,000 servers and 10,000 square feet of space, with the number of servers running into the millions.” (Commercial Property Executive)
- Distress Could Hit More Multifamily Syndicators Than Tides Equities “Apartment syndicators Tides Equities, GVA, Rise 48, ZMR, Nitya and others who counted on low interest rates face a reckoning.” (The Real Deal)
- BREIT June Redemption Request Lowest of Year “Blackstone Real Estate Income Trust Inc., a non-traded real estate investment trust sponsored by Blackstone Inc. (NYSE: BX), received redemption requests totaling $3.8 billion in June, which BREIT says is 29% lower than the peak in January 2023 and the lowest month of repurchase requests this year. In accordance with its repurchase plan, BREIT fulfilled requests equal to 2% of NAV in each of April and May, leaving 1% of NAV eligible for repurchase in June. Accordingly, BREIT says the company is fulfilling approximately $628 million, which is equal to 1% of NAV and represents 17% of the shares submitted for repurchase.” (The DI Wire)
- Commercial Property Fears Create Opportunities, Blackstone Real Estate Co-Head Says “Fears over turbulence in commercial real estate are creating opportunities for well-capitalized investors, according to Blackstone Inc. co-head of global real estate Kathleen McCarthy.” (themiddlemarket.com)
- How the IRS Streamlined a Key CRE Strategy “In January, the IRS released Revenue Procedure (Rev. Proc.) 2023-9, which refreshed and streamlined a previous tax strategy: Rev. Proc. 92-29. Rev. Proc. 92-29 had provided certain benefits to real estate developers who are contractually obligated to provide common area improvements—either real property or real property improvements—on multiple properties held for sale. The strategy led to deferring taxes to future years by allocating increased costs to properties sold in earlier years.” (Commercial Property Executive)
- New York State Built Elon Musk a $1 Billion Factory. ‘It Was a Bad Deal.’ “New York state paid to build a quarter-mile-long facility with 1.2 million square feet of industrial space, which it now owns and leases to Tesla for $1 a year. It bought $240 million worth of solar-panel manufacturing equipment. Musk had said that by 2020 the Buffalo plant each week would churn out enough solar-panel shingles to cover 1,000 roofs. The Tesla solar-energy unit behind the plan, however, is averaging just 21 installations a week, according to energy analysts at Wood Mackenzie who reviewed utility data. The building houses some factory workers, but also hundreds of lower-paid desk-bound data analysts working on other Tesla business.” (The Wall Street Journal)
- Big Lots Signs $318 Million Sale-Leaseback Deal Involving 26 Stores “Big Lots is converting some of its real estate into cash. The discount retailer has inked a deal to sell 26 of its stores and a California distribution center to Blue Owl Capital in a sale-leaseback agreement valued at $318 million. The transaction covers just a small percentage of the company’s shops. As of the beginning of 2023, Big Lots’ retail store portfolio totaled more than 1,400 locations across the country spanning 47.1 million square feet. With an average store size of roughly 33,300 square feet, the company will lease back a total of approximately 865,000 square feet, excluding the distribution center.” (Propmodo)
- Retail Is Now Taking the Brunt of Economic Fallout from Mass Shootings “When Allen Premium Outlets reopened its doors late last month, 25 days after a gunman killed eight people, wounded seven and traumatized hundreds more, many members of the community took to social media to say it was too soon. A spate of deadly shootings has gripped U.S. malls and shopping centers over the past several years, leaving operators grappling with how to minimize the emotional and financial fallout.” (Bisnow)
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