CoStar ups its bid to acquire CoreLogic

CoStar ups its bid to acquire CoreLogic

 
Photo illustration of CoStar Group CEO Andrew Florance (iStock, Getty/Illustration by Kevin Rebong for The Real Deal)

Photo illustration of CoStar Group CEO Andrew Florance (iStock, Getty/Illustration by Kevin Rebong for The Real Deal)

The fight for the future of CoreLogic continues.

CoStar Group upped its offer to acquire the real estate data company to $97 per share, an increase over its most recent offer of $95.76 per share, Bloomberg News reported.

The latest offer is also $17 per share higher than the recent agreement CoreLogic made with Stone Point Capital and Insight Partners, who agreed to buy the company for approximately $6 billion.

CoStar also attempted to sweeten the deal by structuring its offer so that shareholders would receive about $6 per share in cash, along with CoStar stock. It also offered to pay a $165 million termination fee.

“CoStar Group is committed to moving forward with such a transaction,” CoStar Chief Executive Officer Andrew Florance said in a letter to CoreLogic’s board, according to Bloomberg News. “We expect the CoreLogic board to deem this proposal to be a ‘superior proposal’ within 48 hours.”

But that may not necessarily be the case. Despite submitting a higher bid initially, CoStar was passed over by CoreLogic in favor of the offer from Stone Point Capital and Insight Partners — and it still prefers that offer, the publication reported.

In its fourth quarter earnings call, CoStar reported a 19 percent increase in revenue, largely driven by the acquisition of such companies as Ten-X, Emporis and Homesnap. It plans to acquire more companies in the residential space in 2021.

[Bloomberg News] — Sasha Jones

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Facelift required: Beauty mogul sells Palm Beach lot for $42M

Facelift required: Beauty mogul sells Palm Beach lot for $42M

1440 South Ocean Boulevard and Sydell Miller (Google Maps, Getty)

1440 South Ocean Boulevard and Sydell Miller (Google Maps, Getty)

What’s the going price for an empty lakefront lot in Palm Beach? Apparently $42 million, according to a recently filed deed.

Beauty mogul Sydell Miller sold the 1.7-acre lot at 1440 South Ocean Boulevard to a trust managed by Ronald Kochman, property records show. The seller was 1440 Holdings LLC, managed by Richard Armbruster.

Miller, with her late husband Arnold, sold their hair and beauty products line Matrix Essentials to Bristol Myers Squibb in 2005.

Miller sold the oceanfront estate across the street from the lakefront lot for $105 million in 2019 to billionaire hedge fund manager Steven Schonfeld and his wife Brooke. At the time, It set a record for the tony town of Palm Beach.

Miller paid nearly $43 million for a full floor at the Bristol in West Palm Beach that same year.

She paid $10 million for the lakefront lot in 1999, records show.

Inventory is down and luxury sales are up in Palm Beach. In February, hedge fund billionaire David Tepper closed on his purchase of an oceanfront mansion at 905 North Ocean Boulevard for $68.4 million.

That same month, private equity titan Scott Shleifer paid more than $120 million for the oceanfront mansion at 535 North County Road in Palm Beach, setting a record for residential sales in Florida and marking one of the most expensive home sales in the U.S.

Last week, developer Carl Panattoni sold a vacant oceanfront lot in Palm Beach for $34.2 million, nearly $6 million more than his purchase price a year ago.

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Five reasons Andrew Cuomo is doomed

Five reasons Andrew Cuomo is doomed

(Getty / Photo Illustration by Alison Bushor for The Real Deal)

(Getty / Photo Illustration by Alison Bushor for The Real Deal)

The governor was at the peak of his powers — a rising star in the Democratic Party and the most feared figure in the state of New York. Within a week, it all came crashing down.

The year was 2008 — so long ago that word of Eliot Spitzer’s resignation arrived in newsrooms by fax.

The world has changed since then, but in ways that will only make it harder for Gov. Andrew Cuomo to survive the scandal now engulfing him. When the New York Times on Saturday night reported a 25-year-old former Cuomo aide’s devastating account of her experience with the 63-year-old governor, problems that had amounted to a dumpster fire for him immediately became an inferno.

The real estate industry would be wise not to count on Cuomo to help with anything during state budget negotiations, or during the rest of the legislative session, or quite possibly ever again.

Five reasons in particular foretell an ending similar to Spitzer’s nearly 13 years ago.

1. Cuomo’s alleged actions were worse than Spitzer’s.

Spitzer, who was married at the time, was found to have been sleeping with a $1,000-an-hour prostitute. The scandal undermined not only his credibility but the moralistic, law-and-order reputation he had built as a swashbuckling prosecutor. By the same token, Cuomo — who succeeded Spitzer as attorney general — has fashioned himself as a champion of women, a crusader against sexual harassment and a paragon of rectitude.

But Spitzer’s liaisons were with a consenting adult. Charlotte Bennett, by contrast, was a member of Cuomo’s staff, and the encounter she endured with him was unexpected and left her deeply shaken, according to the credible and documented telling she gave the Times.

The media has focused on Cuomo’s unmistakable overtures: asking Bennett how she felt about relationships with older men and whether she ever been with one, and telling her he was fine with anyone over age 22 — classic sexual harassment.

But there was an even darker element of their dialogue, said Bennett, a former victim of sexual assault and an activist on the issue.

“The way he was repeating, ‘You were raped and abused and attacked and assaulted and betrayed,’ over and over again while looking me directly in the eyes was something out of a horror movie,” she texted a friend afterward.

Like Cuomo, Spitzer ruled by fear; other elected officials were afraid of his wrath, because he had the power and high approval ratings to crush them in any public fight. But, also like Cuomo, he had no friends to come to his aid or well of goodwill to fall back on.

Spitzer lasted six days after the scandal broke. This is Day Two for Cuomo, and already he has been forced to give ground twice on who will conduct the investigation.

2. The Al Franken standard has been set.

The Minnesota senator was ascendant among progressives and crucial to Democrats’ power in the U.S. Senate. But when his history of sexual harassment was revealed, his colleagues — led by Sen. Kirsten Gillibrand — forced him to resign in 2018, ignoring his initially flimsy excuses and increasingly contrite apologies. They realized that they had to hold Democrats to the same standards as they did Republicans accused of similar misdeeds.

Franken’s career ended, and Gillibrand gained prominence. She’s still the junior senator from New York (a seat she was appointed to by Spitzer’s successor, David Paterson). Like Franken did initially, Cuomo tried to downplay his conversation with Bennett, saying he likes to joke around with his aides. That persuaded no one, because there’s nothing remotely funny about what he allegedly said. And Democrats don’t need Cuomo nearly as much as they needed Franken. It’s hard to see Cuomo faring any better.

On top of that, it’s the #MeToo era. Decades ago, a scandal like this might have blown over. These days, people get canceled for a lot less than the governor allegedly did. Society is not quite at zero tolerance for sexual harassment, but it’s getting closer.

3. There are multiple accusers.

When former Cuomo aide Lindsey Boylan came forward with allegations against Cuomo, first on Twitter and later on Medium, the governor tried to depict her as a liar who had no evidence. He even tried to discredit her account of a flight on which she said he suggested, with a press aide and state trooper present, that they play strip poker.

Cuomo’s people said they searched but found no manifest showing a flight with only those people on board. But Boylan never said they were the only people on board.

Now that Bennett has come forward with her detailed account, backed up by text messages and recollections of people she spoke with, Boylan is no longer seen as an outlier or a fabricator — and Cuomo’s behavior seems more like a pattern than an aberration.

4. The allegations are plausible.

Cuomo did not specifically deny Boylan’s accusation that he kissed her on the lips, which is several orders of magnitude more serious than the other interactions she described. It’s well over what anyone might deem a fuzzy line between acceptable behavior and sexual harassment. Even Cuomo did not try to downplay the kiss as a well-meaning but misinterpreted act.

Bennett said Cuomo had told her he had been lonely during the pandemic and “can’t even hug anyone.” He had made it known publicly last year that he was looking for a girlfriend following his breakup with Sandra Lee. This context makes Bennett’s account more believable.

5. Politics will push him to resign.

Cuomo had a stranglehold on his office and seemed inclined to keep winning re-election. His ouster would open the race to many ambitious Democrats and even some Republicans who hitherto had no shot at even being taken seriously, let alone winning.

Republicans are already mocking Democrats for abiding Cuomo. Democrats, for their part, have little to gain from keeping him in office. Even when Cuomo was at the peak of his powers, he did precious little to help other Democrats win seats or advance their careers. (And when he did, his motivations were seen as selfish.) They have been taking shots at him for weeks — over nursing homes and emergency powers — something they had been afraid to do for years.

Few if any will stick their necks out for him now. The rest are likely sharpening their blades.

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Easton Group scores $12M construction financing for Doral spec warehouse

Easton Group scores $12M construction financing for Doral spec warehouse

Edward Easton and rendering of Doral warehouse at 1500 Northwest 97th Avenue

Edward Easton and rendering of Doral warehouse at 1500 Northwest 97th Avenue

The Easton Group scored a $12 million construction loan for a Doral spec warehouse, amid a hot industrial market largely fueled by e-commerce.

Easton Group borrowed the funds through its affiliates ICP NW 97th Associates and EEBB Apartment II Holdco, which are listed as the lot owners, according to records. City National Bank of Florida provided the financing.

Doral-based Easton, founded and led by Edward Easton, already started construction on the 127,000-square-foot project on a 7-acre vacant lot. The property is along Northwest 97th Avenue and just north of the Dolphin Expressway at 1500 Northwest 97th Avenue.

Edward Easton said the development represents a roughly $20 million investment. Dalton Easton, Easton’s grandson and a commercial associate at the firm, put together the deal and will handle leasing with Tom Kimen, vice president of the Easton Group. They are in talks with potential tenants but no leases have yet been signed, Edward Easton said.

The warehouse could be leased to one 127,000-square-foot tenant or it could be divided into roughly 10,000-square-foot bays for several tenants, he added.

Construction is expected to be completed by November. The building will have 30-foot clearing heights and an asking rental rate of $10 per square foot, triple net.

Records show Easton Group bought the land for $5.3 million in February 2016, through a different affiliate, and then transferred the land to its ICP affiliate in December 2019. Easton’s EEBB affiliate paid $2.3 million to buy into the property last year, according to records.

Industrial has remained a top-performing asset class, even as other property types have taken a hit during the pandemic. The market is especially hot in Miami-Dade County, where e-commerce tenants leased a record 2 million square feet last year, according to a JLL fourth quarter 2020 report.

Overall, industrial demand picked up toward the end of last year and outpaced supply for the first time in four years, resulting in 1.3 million square feet of positive net absorption for 2020 in Miami-Dade, according to JLL. Nearly every county submarket reported a below 6 percent vacancy rate at the close of last year.

Doral is a prime industrial submarket, given its proximity to Miami International Airport, and Easton Group has been active in the area. The company developed the 300-acre International Corporate Park, a master-planned business park, just north of its warehouse construction site. The firm also acts as a broker, property manager and investor.

The hot industrial market has translated into lending activity for new projects. In December, Exeter Property Group secured a $75 million loan for the second phase of its Coral Springs Commerce Center.

In November, a Bridge Development Partners and PGIM Real Estate joint venture secured a $67 million construction loan for a Hialeah cold storage facility.

[contact-form-7]

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Compass lost $270M in 2020, revenue up 56% : IPO filing

Compass lost $270M in 2020, revenue up 56% : IPO filing

Robert Reffkin (Getty, Securities and Exchange Commission)

Robert Reffkin (Getty, Securities and Exchange Commission)

On the verge of going public, Compass disclosed it earned $3.7 billion in revenue last year but lost $270 million, according to an investor prospectus it filed Monday.

The IPO filing, known as a form S-1, provides the clearest look into the financials of the company, which is likely the fastest-growing U.S. residential brokerage in a generation. Compass’ revenue grew 56 percent in 2020 from $2.4 billion in 2019. It cut its losses from $388 million in 2019, and has lost a total of $1.1 billion as of Dec. 31, 2020.

Founded in 2012, Compass has 19,000 agents, and in 2020 became the third-largest brokerage in the U.S. by deal volume, according to Real Trends data, with over $91 billion in 2019 sales. The firm has raised $1.5 billion from investors, including SoftBank Group, and was last valued at $6.4 billion after a July 2019 funding round. Its ascendance has been fueled by a combination of organic growth, agent recruitment and a flurry of notable acquisitions. It currently has $440.1 million in cash on hand, the S-1 shows.

The company filed a draft registration statement with the U.S. Securities and Exchange Commission in early January, as The Real Deal first reported. The document it filed today, however, will provide prospective public market investors details on its financials, its competitive landscape and its leadership.

The document revealed, for example, that co-founder Ori Allon left Compass’ board of directors in February. Allon was previously executive chairman; his new title on the firm’s website is “chief strategist.” Allon holds just over 1.9 million shares of Class A Common Stock, or about 5.2 percent of the overall Class A shares issued.

Robert Reffkin, co-founder and CEO, has just over 860,000 shares of Class A Common Stock, or about 2.4 percent of the overall Class A shares issued. Reffkin also owns more than 1.5 million shares of Class C common stock, which grant him 20 votes per share.

Other major stockholders include SoftBank’s Vision Fund, which owns 34.8 percent of Class A common stock, through subsidiary SVF Excalibur (Cayman) Limited. Hedge funder Robert Citrone’s Discovery Capital Management owns 9.2 percent of Class A shares.

Buoyed by the hot housing market, Compass said it sold $151.7 billion worth of real estate in 2020, according to the S-1. Its transactions were up 66 percent year-over-year. The firm claims it now has about 4 percent of the U.S. housing market.

The prospectus also cited key legal battles Compass is facing.

In 2014, the firm was sued by Avi Dorfman, who claims he co-founded Compass but was later cut out of the action. Compass has called his suit “opportunistic.”

Compass is also facing a wide-ranging lawsuit from key rival Realogy, the parent company of the Corcoran Group and Coldwell Banker. The public real estate giant sued in 2019, alleging Compass engaged in illicit business practices and predatory poaching. Compass has defended its actions and sought arbitration in the case, which was denied. This January, Compass sued Realogy, accusing the company of waging a “war of disinformation.”

This is a developing story. Please check back for updates.

Erin Hudson contributed reporting.

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U.S. mall values fall 60% after appraisals

U.S. mall values fall 60% after appraisals

Many of the lower-tier malls that will be sold will likely be redeveloped into something else. (Getty)

Many of the lower-tier malls that will be sold will likely be redeveloped into something else. (Getty)

The suburban mall that you frequented as a teenager could now be worth substantially less than the dirt underneath it.

U.S. mall values declined 60 percent due to appraisals in 2020, according to an analysis by Bloomberg News. Across 118 shopping centers with commercial mortgage-backed securities loans, about $4 billion was lost after reappraisals caused by delinquencies, defaults or foreclosures.

The data suggests a grim outlook for many malls across the country as some of the largest mall owners, including Brookfield Property Partners and Simon Property Group, are increasingly walking away from underperforming properties and handing them over to their lenders.

In some cases, malls are being foreclosed on with almost no interest from outside investors. A recent foreclosure auction of a Simon mall outside of Atlanta yielded no bids despite a previous valuation of $322 million.

In Connecticut, a portion of a shopping center owned by Simon recently saw its value drop by 88 percent after an appraisal.

Many of the lower-tier malls that will be sold will likely be redeveloped into something else, according to industry experts.

“The orange tile and brown carpeting is just going to be torn down and plowed under and eventually trade at a price someone can build something else there,” Jim Costello of the research firm RCA told Bloomberg.

But it’s not just lower-tier malls that are in trouble: The valuation of Class-A malls fell by nearly half since 2016, according to a recent report by Green Street.

Mall traffic has dropped significantly across the U.S. because of Covid restrictions and consumer hesitation, which has accelerated the shift toward e-commerce that was already in place. Some retailers have also declared bankruptcy or stopped paying rent on their mall space, further squeezing operators.

[Bloomberg News] — Keith Larsen

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Miami-Dade condo sales and dollar volume surge at end of February

Miami-Dade condo sales and dollar volume surge at end of February



Miami-Dade County condo sales doubled and dollar volume also rose in the last week of February.

A total of 225 condos sold last week for $140.5 million, up from 113 condos that sold the previous week for $97.8 million.

Units sold for an average price of about $624,000, down from $866,000 the prior week. Condos sold for $414 per square foot on average, the same amount as the previous week.

The most expensive sale was for unit 1103 at Apogee in Miami Beach. The unit sold for $7.5 million, or $2,721 per square foot, after 33 days on the Multiple Listing Service. Stacy Robins represented the seller, and Daniel Hechtkopf represented the buyer.

The second most expensive sale of the week was at Continuum on South Beach, also in Miami Beach. Unit 2008 sold for $6.6 million, or $1,953 per square foot, after 415 days on the market. Julian Johnston represented the seller, and Marci Declaris represented the buyer.

Here’s a breakdown of the top 10 sales from Feb. 21 to Feb. 27.

Most expensive
Apogee 1103 | 33 days on market | $7.5M | $2,721 psf | Listing agent: Stacy Robins | Buyer’s agent: Daniel Hechtkopf

Least expensive
Sereno Residences Condo 206 | 299 days on market | $2.5M | $908 psf | Listing agent: Hillary Hertzberg | Buyer’s agent: Oliver Lloyd

Most days on market
Continuum on South Beach 2008 | 415 days on market | $6.6M | $1,953 psf | Listing agent: Julian Johnston | Buyer’s agent: Marci Declaris

Fewest days on market
Apogee 1103 | 33 days on market | $7.5M | $2,721 psf | Listing agent: Stacy Robins | Buyer’s agent: Daniel Hechtkopf

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Movers & Shakers: Ackman-Ziff hires Michael Helpern as director & more

Movers & Shakers: Ackman-Ziff hires Michael Helpern as director & more

From left: Michael Helpern, Richard Hottinger and Norma Jean Callahan

From left: Michael Helpern, Richard Hottinger and Norma Jean Callahan

Ackman-Ziff Real Estate Group hired Michael Helpern as director. Prior to joining Ackman-Ziff, Helpern was a director at Institutional Property Advisors, a subsidiary of Marcus & Millichap. Melissa Rose, who was managing director of Ackman-Ziff’s Miami office, left last year to join JLL.

Norma Jean Callahan is joining Corcoran agent Richard Hottinger to create the Hottinger-Callahan Team, based at Corcoran’s Surfside office. Callahan and Hottinger and their team of nine agents will serve both the New York and Miami markets.

Callahan spent 13 years at Corcoran Sunshine Marketing Group, where she was most recently senior sales director.

Institutional Property Advisors hired Sean Williams as senior vice president. Williams has represented multifamily investors in the Tampa Bay region for more than 18 years with prior positions at Walker & Dunlop, CBRE and Camden Property Trust.

Lloyd Jones named Andy Carroll chief investment officer to guide the firm’s multifamily and senior housing investment strategies. Carroll is the former director of investments for American House Senior Living, one of the nation’s largest senior housing owner/operators.

Lisa Colon joined Saul Ewing Arnstein & Lehr’s Fort Lauderdale office as a partner in the firm’s litigation practice, along with its construction, real estate and government contracting industry groups.

CGI Merchant Group hired Euclid Walker as senior managing director. Walker will be leading strategy and acquisition efforts for CGI’s signature Hospitality Opportunity Fund, while also managing the firm’s additional investment vehicles, including fundraising and investor relations initiatives.

Prior to joining CGI, Walker founded and led several businesses, including the investment and advisory firm Parkway Investment Management, LLC, which has ownership stakes in Opportunity Zone Advisors, LLC, and Global Oak Capital Markets, LLC, a registered broker-dealer and investment banking firm.

SB Architects expanded its senior leadership team, promoting Harris Christiaansen, Mickey Mazerac, Thomas Gay, Lucienne Walpole, Marcelo Balzano and Miguel Campo to vice president.

Attorney Juan Loumiet joined Weiss Serota Helfman Cole & Bierman, P.L. as partner in the firm’s Miami office. Loumiet previously practiced for more than four decades at Greenberg Traurig, where he founded Greenberg Traurig’s bankruptcy practice and served in a number of firm leadership positions.

Attorney Cayla Ross, who works with Loumiet, is also joining the firm as an associate.

Warren Adams was appointed director of historical resources and cultural arts for the city of Coral Gables. He will be responsible for managing the city’s historic preservation program and properties and the Cultural Grants and Art in Public Places programs. Previously, Adams served as the city of Miami’s historic preservation officer.

[contact-form-7]

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Global luxury home sale prices nudged up in 2020

Global luxury home sale prices nudged up in 2020

Auckland, New Zealand and Shenzhen, China (iStock)

Auckland, New Zealand and Shenzhen, China (iStock)

Global luxury home sale prices ticked up slightly in 2020, as pent-up demand created by coronavirus lockdowns led to buying binges.

The average price for a luxury home that sold rose 1.9 percent in 2020, compared to its 1.8 percent increase in 2019, according to Knight Frank’s Prime International Residential Index 100, cited by Mansion Global.

While 29 of the 100 markets in the index reported year-over-year price declines — compared to 21 in 2019 — there were five markets that recorded double-digit percentage increases compared to two in 2019.

Among those were Auckland, New Zealand, which saw the most significant jump in luxury home sale prices at 18 percent. Shenzhen, China, had a 13 percent rise; Seoul, South Korea, had a 12 percent jump; and Manila in the Philippines saw a 10 percent uptick.

The analysis also looked at regional luxury price changes. Among the largest increases were North America, which had a 6.3 percent price rise and Australasia — comprising Australia, New Zealand and neighbouring islands — which saw a 4.9 percent jump.

Plenty of cities around the globe also saw declines in high-end property sales. Cape Town saw a 9.2 percent slide, while Bangkok home sale prices dropped 7.3 percent and Hong Kong prices fell 6.9 percent, according to Knight Frank.

In the U.S., overall home sale prices in December rose 10.4 percent year-over-year, according to a report released last week by Case-Shiller. That followed seven straight months of growth after Covid-related restrictions on real estate business.

The pandemic and the proliferation of remote working spurred buying in suburban and rural areas in the U.S., while bottoming out in urban markets like New York. But those, too, have shown signs of recovery lately, with home prices increasing 15 percent in metros in the three months ending in January.

[MG] — Dennis Lynch

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Japan’s tallest tower project will include Aman Resorts luxury residences

Japan’s tallest tower project will include Aman Resorts luxury residences

Aman CEO Vladislav Doronin and the upcoming towers. (Getty, DBOXCG)

Aman CEO Vladislav Doronin and the upcoming towers. (Getty, DBOXCG)

 

A Tokyo skyscraper under construction and set to become the tallest tower in Japan will include Aman Resorts-branded luxury residences that could top $40 million each.

Mori Building Company’s 1,082-foot-tall tower in Minato Ward will have 91 units on floors 54 through 64, according to the Japan Times.

The residences will be operated by luxury hotel company Aman Resorts and called the Aman Residences, Tokyo.

Branded residences have grown in popularity over the last several years, with some major firms making plays in the space. As of late 2019, more than 400 residential projects worldwide were branded in some way. Four Seasons launched into standalone branded condo projects that year.

In the U.S., Vladislav Doronin’s Aman Resorts has also partnered with Access Industries on a hotel and condo project in the works in Miami.

For the Tokyo project, Mori Building Co. hasn’t disclosed the name of the tower but services will include a residents-only spa, among other amenities. One unit could cost at least several billion yen — in the $40 million to $50 million range — according to the report.

But Mori Building Co.’s tower may not be the tallest in Japan for long. Real estate firm Mitsubishi Estate is planning a 1,279-foot-tall skyscraper in Toyko’s Tokiwabashi district. The firm announced that project in 2016 but only last year revealed details.

[JT] — Dennis Lynch

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