NAIOP's new "City" tailor-made for REIT/finance-land Take some of the leading public real estate companies, mix with a dash of respected finance firms and stir it up in a meet-and-great, cozy deal-making setting, and wrap it around one of the real estate industry's biggest gatherings of top decision-makers. That's Deal City, and the National Association of Industrial and Office Properties (NAIOP) is set to tee up this event-within-an-event during its annual Marketplace Conference, kicking off this year in Atlanta October 21-23 at the Marriott Marquis.
The idea is to give attendees a unique opportunity to network with and learn more about what various types of deal-making firms are offering the industry, all in a one-stop shop over two full days.
Each Deal City participant will have a mini-suite within a designated area of the Marketplace that will be complete with offices, comfortable chairs and lounges where conference attendees can meet directly with prominent deal-makers in the right environment for doing deals - buying and selling properties, planning mergers and acquisitions, initiating financing, forming alliances or discovering new joint venture development opportunities.
Why are companies getting involved in Deal City? We asked a few to find out.
"We are extremely active developing across the United States. Deal City provides an opportunity to market our new projects as well as gain exposure to the overall industry," says Thad Ellis of CarrAmerica in Atlanta. "The possibility of one-on-one visits versus 'selling' to a crowd is good. Also, the opportunity to visit with other participants and share ideas and view other marketing approaches."
For Jim Mertz of Mack-Cali in Dallas, it is an opportunity to network to high-quality prospects. "NAIOP members are a great target market for us to search opportunities with. As a board member of the Dallas chapter, I am aware of the caliber of NAIOP's membership," says Mertz.
For Hal Platzkere of GMAC Commer-cial Mortgage in Horsham, Pa., it's simple: "To make new contacts and meet prospective customers. Hopefully we will make new contacts and get our name in the marketplace for our producers."
And Phil Stevenson of Carter & Associates Oncor in Atlanta says there is nothing like it. "Deal City should be an extremely efficient way for our firm to meet a whole range of potential investment partners in a short period of time."
Who attends NAIOP to attract these heavy hitters? A profile of company attendees finds that nearly 18% were involved in a merger or acquisition in the past 24 months, and 22% expect to be involved in one during the next 24 months. The average square footage owned is 4.2 million sq. ft. Ownership is estimated to increase by 55% in urban and 27% in suburban markets over the next two years. The average square footage managed is 3.5 million sq. ft., and the average value of total transactions on property bought or sold by a company during the most recent fiscal year was $134.7 million, with a median value of $15 million.
For REITs, opportunities include discovering hard-to-find properties, meeting new development partners, investigating new markets, identifying niche players in key markets and disposing of surplus properties.
Investors and capital sources may build relationships, discover prom-ising new investment opportunities, expand market coverage and penetration and promote their availability of capital.
Space in Deal City, though, is limited to just 35 suites, each ranging in size from 200 sq. ft. up to 600 sq. ft. So far, 21 of the Deal City Suites are sold. To find out more information about participating in this program, call Kathleen Turner at 1-800-666-6780, ext. 117. To find out more about the NAIOP Annual Confer-ence Marketplace, call Jennifer Goodwin at 703-904-7100, ext. 108. You can also access the NAIOP home page on the Internet at ww.naiop.org.
$496 million transaction is first CRIIMI MAE "No-Lock" mortgage In a transaction that is the first securitization of its "No-Lock" commercial mortgage product, Rockville, Md.-based CRIIMI MAE Inc. (NYSE:CMM) has securitized $496 million of commercial mortgage loans originated or acquired through the company's network of regional offices.
Through the securitization - CRIIMI MAE CMBS Corp., Commercial Mortgage Loan Trust Certificates, Series 1998-1 - CRIIMI MAE sold $397 million face amount of fixed-rate investment grade securities while retaining the remaining principal and interest cash flows from the mortgage loans that collateralize the securitization. CRIIMI MAE Services Limited Partnership, an affiliate, will act as loan manager, master servicer and special servicer for the mortgage trust.
CRIIMI MAE joined forces with Prudential Mortgage Capital Co. LLC, the commercial mortgage affiliate of The Prudential Insurance Co. of America, to begin originating "No-Lock" loans from $30 million to $100 million. The company expects to securitize $1 billion of these loans within 12 months.
Bank of America launches new loan product for small investors San Francisco-based Bank of America has launched a new loan product designed to provide real estate investors non-recourse commercial mortgage loans under $1 million. The product is available to investors seeking to finance income-producing properties, including multifamily, industrial, office, retail, self-storage and mobile home parks located throughout, the Northwest, the Southwest and the Midwest. Loan sizes range from $250,000 to $1 million. Generally, there is a 25-year amortization for Class-C properties and 30-year amortization available for most other properties.
Chastain Capital announces initial investments of $75 million Chastain Capital Corp. (Nasdaq/NM:CHAS), an Atlanta-based real estate investment trust managed by ERE Yarmouth, announced initial investments totaling $75 million from its active investment pipeline. The company has agreed to acquire subordinated commercial mortgage-backed securities from Bear Stearns Commercial Mortgage Securities Inc., New York, with a face amount of $57 million and a purchase price of $42 million, in a transaction that was scheduled to close by the end of June. In May, the company closed on four CMBS transactions with an aggregate face amount of $35 million and an aggregate purchase price of $33 million.
Midland Loan Services launches high LTV lending program Midland Loan Services Inc., a Kansas City, Mo.-based real estate financial services firm, has launched a new commercial mortgage lending program enabling qualified borrowers to obtain higher leverage and a lower cost of capital. The new high loan-to-value program is designed to complement the $1.5 billion in conventional financing originated annually through the company's mortgage subsidiary, Midland Commercial Funding.
Under this program Midland closed, in 12 business days, a $10.5 million high LTV loan to finance a borrower's acquisition of Michigan National Tower, a 190,400 sq. ft. office building in Lansing, Mich. The loan represented 90% of the purchase price.
The program will focus on complex lending situations, customizing loans ranging from $2 million to $15 million in size. Pricing will generally be 50 to 150 basis points higher than conventional conduit loans.
GMAC to acquire assets of Newman & Associates GMAC Commercial Mortgage Corp., Horsham, Pa., has signed a definitive agreement to acquire Newman & Associates Inc., a privately held Denver-based investment banking firm specializing in the financing of real estate projects, and Newman Mortgage Acceptance Corp., Newman's mortgage banking entity. Under terms of the agreement, Newman will become a wholly owned GMACCM subsidiary.
Glimcher secures $163 million from Bankers Trust group for megamall Glimcher Realty Trust (NYSE:GRT), a Columbus, Ohio-based real estate investment trust, has closed on a loan totaling approximately $163 million from Bankers Trust, as agent, and The Huntington National Bank, as co-agent, to finance development of its Jersey Gardens megamall site in Elizabeth, N.J.
Arranged by BT Alex. Brown Inc., the loan, along with $56 million in equity previously provided by Glimcher, will fund the estimated cost of on-site improvement. Additional infrastructure improvements totaling $140 million are being financed separately through a combination of tax-exempt economic development bonds and government grants, bringing the total project cost to approximately $360 million.
DCR assigns 'BBB+' rating to Equity Office offering Duff & Phelps Credit Rating Co. (DCR) has assigned its 'BBB+' (Triple-B-Plus) rating to a recent offering of $775 million senior unsecured notes issued by EOP Operating Limited Partnership, the principal operating subsidiary of parent and general partner Chicago-based Equity Office Properties Trust (NYSE:EOP). The notes were offered in three tranches: $250 million of 6.5% notes due 2004, $300 million of 6.763% notes due 2007 and $225 million of 7.25% notes due 2028. DCP says that the ratings are based on EOP's large portfolio size, primary focus on Class-A properties and strong asset and market diversification - factors that the agency says help mitigate exposure to potential downturns in individual markets.
Executive Suite AMRESCO Inc. Richard H. Cole has been appointed chief executive officer of Holliday Fenoglio Fowler, L.P., the firm's Houston-based commercial mortgage banking subsidiary. Cole is succeeding John T. Fenoglio, who is establishing a nonprofit organization dedicated to environmental matters.
Dynex Commercial Inc. Douglas A. Korey, formerly with Ziegler Capital Co. LLC, has joined the company as president of its new Dynex Healthcare Inc. subsidiary, which specializes in the financing of assisted living and long-term care facilities nationwide. Korey has established headquarters in Long Branch, N.J. Production volume for the new group is anticipated to exceed $100 million in 1998 and $200 million in 1999.
GMAC Commercial Mortgage Paula Thoreen, formerly a GMACCM vice president, has been named chief operating officer of the company's newly formed Realty Services International subsidiary. The new appraisal service company currently is pursuing several initiatives for the CMBS market.
Capital Lease Funding Corp. CarrAmerica Carter & Associates Oncor Chenco International Investment Corp. Cousins Properties Inc. ERE Yarmouth FINOVA Realty Capital Inc. First Industrial Realty Trust Inc. GMAC Commercial Mortgage Corp. Licausi-Styers Company Mack-Cali Realty Corp. Nomura Capital National Real Estate Investor Patriot American/Wyndham Dev. Prudential Mortgage Capital Co., LLC The Quest Group Security Capital Industrial Trust Stile Corp. Triad Properties Corp. ValuExpress LLC Weeks Corp.