Editors’ Weekly News Roundup October 13 – October 17
Amid the current shutdown of the federal government, at least one important piece of business for commercial real estate has been advanced. The House of Representatives is not in session, but the Senate is, as evinced by the most-read Connect CRE story of the past week, Senate Passes ROAD to Housing Act; Bill Awaits House Consideration.
The bipartisan legislation “takes important steps to boost the nation’s housing supply, improve housing affordability and increase oversight and efficiency of federal regulators and housing programs,” said Sen. Elizabeth Warren (D-MA), who cosponsored the bill with Senate Banking Committee Chair Tim Scott (R-SC). Industry associations including the Mortgage Bankers Association and the National Multifamily Housing Council also applauded the Senate’s action.
Also in the past week, a CRE finance veteran announced the launch of a new venture and the considerable backing of anchor partners that include Fortress Investment Group and Liberty Mutual Investments. Derby Lane Partners Launches with $1.8B in Capital Commitments was the week’s second most-read story.
Founded by Adam Piekarski, most recently co-head of real estate credit at BDT & MSD Partners, Derby Lane aims to provide flexible, creative capital solutions to the market across asset classes. Its initial focus will be CRE credit in North America.
If the top two stories of the past week represented positive developments, the week’s third most-read story offered less encouraging news. Derived from Yardi Matrix data, U.S. Apartment Rent Growth Turns Negative for September reported that the $6 decrease in advertised rents was the biggest monthly decline since November 2022 and represented the worst September result since 2009.
The news was better for apartment landlords in some parts of the country than for those in others. New York City posted year-over-year rent growth of 4.8% in September, while at the other end of the spectrum, Denver’s Y-O-Y drop was comparable.
Regional transactions were the basis of the fourth and fifth most-read stories last week. Drawbridge Acquires Costa Mesa Office Campus, Leases it to Anduril reported that Drawbridge Realty bought the 190,000-square-foot HIVE offices in California’s Orange County from Invesco in a deal arranged by Eastdil Secured.
In a way, the transaction swam against the tide of current trends, which favor office conversion to residential. Invesco and Legacy Partners announced such conversion plans for The HIVE in 2023, but instead sold it to an owner that plans to continue using it for its original purpose.
The project reported in the week’s fifth most-read story will serve both purposes when completed. Continuing the redevelopment of a traditionally industrial area of Boston’s Allston neighborhood, locally based Bracken Development and Philadelphia-based Pennrose have secured the permits for an 88-unit apartment building that eventually will be joined by 385,700 square feet of commercial space next door.
We reported in Construction Okayed for Two-Building Office/Residential Project in Allston that the neighborhood has been transformed since the Massachusetts Bay Transportation Authority opened its Boston Landing commuter rail station in 2017. The two-building project from Bracken and Pennrose was preceded by two large-scale mixed-use projects and a handful of standalone multifamily buildings.