Lehman Brothers Holdings has beaten out Sam Zell and acquired the last remaining 26.5 percent stake in Archstone for $1.58 billion, the Wall Street Journal reported, giving it complete ownership over the massive apartment portfolio. The failed bank is buying the stake from Bank of America and Barclays, which partnered with Lehman to acquire Archstone in 2007 for $22 billion. The deal values the portfolio at $17 billion. [more]

Sam Zell, Chairman of Equity Residential

Equity Residential’s purchase of a stake in apartment builder Archstone was blocked by the estate of Lehman Brothers Holdings, as Lehman exercised the option to match the bid, the Wall Street Journal reported.

Equity, run by Sam Zell, offered $1.33 billion for 26.5 percent of Archstone, a major competitor of Equity’s. Lehman’s purchase is half of the position in Archstone owned by Bank of America and Barclays and brings its total stake in Archstone to 73.5 percent.   [more]

Sam Zell’s Equity Residential has purchased 175 Kent Avenue, in Williamsburg, Brooklyn, for $76 million, Crain’s reported. The condominium-turned-rental was developed by the Chetrit Group, which bought the property for $56 million in 2007. It was not clear why it chose to sell the project, which leased up after only six months. It may have been less profitable than the developer expected after it converted to rental, Crain’s speculated. Aptsandlofts.com is the exclusive marketing agent for the building, at North 4th Street. Renting commenced in March 2011, with studios for $2,343 a month, one-bedrooms starting at $2,756 and two-bedrooms at $3,413. [more]

Lehman Brothers Holdings matched Equity Residential’s $1.33 billion bid for a 26.5 percent stake in Archstone, and then sued partners Bank of America and Barclays for breaching Lehman’s right of first refusal for the stake in a sale, Bloomberg News reported.

Archstone is a real estate investment trust with stakes in 60,000 U.S. apartment units and 14,000 units in Germany, that Lehman purchased in October 2007 with Tishman Speyer for $22 billion. Lehmar eventually filed for the biggest bankruptcy in U.S. history and refinanced the portfolio and brought in equity partners Barclays and BofA, which combined for a 53 percent stake. [more]

From left: Archstone CEO Scot Sellers and 377 East 33rd Street (building credit: PropertyShark)While a bidding war has emerged for its portfolio, Archstone acquired a 209-unit Kips Bay apartment building for $131 million, the apartment investment firm announced today, and will rename it Archstone Kips Bay.

The building, at 377 East 33rd Street near First Avenue, had been owned by Madison International Realty and RFR Holding, which bought it for an undisclosed price in 2007, according to public records. The partnership took out a $100 million loan on the building from Anglo Irish Bank. – Adam Fusfeld Comments

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Sam Zell and an Archstone building at 800 Sixth Avenue

Sam Zell’s Equity Residential has emerged as the leading bidder in a race to buy 53 percent of rival Archstone, offering more than $2.5 billion in cash for the stake, currently held by Bank of America and Barclays, the Wall Street Journal reported. The rest of the company, a real estate investment trust, is owned by the bankruptcy estate of Lehman Brothers Holdings.

The proposed sale to Equity Residential would value Archstone at about $16 billion, the Journal said. If sold as a whole company, Archstone currently could be worth as much as $18 billion.

Real estate giants the Blackstone Group, Brookfield Asset Management, Equity Residential and AvalonBay Communities have all submitted bids for Archstone in recent months, it was previously reported. [more]

Real estate giants the Blackstone Group, Brookfield Asset Management, Equity Residential and AvalonBay Communities have all submitted bids for real estate investment trust Archstone in recent weeks, but the offers haven’t been enough to resolve a disagreement among the owners over how to unwind Archstone, the Wall Street Journal reported.
Barclays and the estate of Lehman Brothers Holdings are in an ongoing dispute over Archstone, a $22 billion investment made at the peak of the commercial real estate boom that contributed to Lehman’s downfall. According to the Wall Street Journal, Barclays is pushing to sell the company or its assets privately whereas Lehman favors a longer-term approach: taking the company public in what would be the largest real estate initial public offering ever. [more]

Barclays and the estate of Lehman Brothers Holdings are in a dispute over how to unwind real estate investment trust Archstone, a $22 billion investment made at the peak of the commercial real estate boom that contributed to Lehman’s downfall.  According to the Wall Street Journal, Barclays is pushing to sell the company or its assets privately whereas Lehman favors a longer-term approach: taking the company public in what would be the largest real estate initial public offering ever. Meanwhile, Bank of America, the third and final partner, has yet to decide on a favored strategy. It has, however, voiced worry about how much value an IPO would create; Analysts predict between $4 billion and $6 billion in equity. [more]

From the May issue: It looks like sovereign wealth funds — which are made up of pools of money derived from a country’s reserve — are slowly returning to invest in commercial real estate in the United States.

Since the economic crisis of 2008, SWFs had decreased their investments in commercial real estate by at least 20 percent.

But the amount of money they’re investing now is substantial. By 2012, SWFs are expected to have $12 trillion in assets under management.

In one deal last month, the Qatari Investment Authority, the sovereign wealth fund for the tiny Middle East nation of Qatar, emerged as the backer for the largest downtown development under construction in the U.S. — a 10-acre project in Washington, D.C., called CityCenterDC, which broke ground in the first week of April. [more]