Blackstone Group plans to increase the attractiveness of the public plaza along 42nd Street between Times Square and Bryant Park with new retail space, the Wall Street Journal reported. The plans include new retail in Equity Office’s tower at 1095 Sixth Avenue and in a renovated three-story building at 120 West 42nd Street, that will also have two underground levels.

The entire $25 million project is scheduled to be completed in fall 2012. With the plaza already opened last December, Blackstone hopes that the new retail and the Plaza will complement each other going forward. [more]

The same signs of increasing consumer spending that are expected to boost the retail real estate market are already positively impacting the industrial real estate market.

The New York Times cited Cushman & Wakefield data that shows the vacancy rate in industrial properties declined in the first half of the year to 9.7 percent, year-to-date leasing activity is up 27 percent from a year ago, and sales volume in the first half of the year grew nearly 160 percent compared to the same period a year ago.

Several companies have been especially aggressive in acquiring industrial properties, including Clarion Partners, Terren Realty Corporation, Morgan Stanley, the Cabot Group and CenterPoint Properties. But Blackstone Group may be the most active of all, which added 275 industrial buildings for $2 billion, tripling its portfolio. [more]

CBRE NY Region Chairman Robert Alexander (top left), 1411 Broadway and Cushman & Wakefield Vice Chairman Tara StacomQuidsi, the parent company of e-commerce giants Diapers.com and Soap.com that was purchased by Amazon last year, backed out of an all-but-signed lease at Blackstone Group’s 1411 Broadway. According to the New York Post, the firm was expected to sign for 75,000 square feet on the 32nd, 34th and 35th floors of the building at West 40th Street in Midtown, in a lease brokered by a Cushman & Wakefield team led by Tara Stacom.

But Cushman’s loss, will be CB Richard Ellis’ gain. A team of CBRE brokers including Bernie Weitzman, Rob Stillman, Robert Alexander and Zach Freeman was chosen to replace Cushman and market the remaining space a few months ago. [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]

Changes are afoot on 42nd Street. The Blackstone Group, owner of Midtown office tower 1095 Sixth Avenue, has finally filed demolition plans for 124 West 42nd Street, a vacant five-story building it owns in the same area on the blockfront of West 42nd Street between Sixth Avenue and Broadway, the New York Post reported. The demolition will make room for the company’s long-awaited three-story, glass-enclosed retail building, which will contain 42,000 square feet.

Highgate Holdings has also begun test borings at 136 West 42nd Street, its vacant lot slated to become a hotel, the Post said. Highgate is in contract to sell the new hotel — which will have between 250 and 400 rooms — to Diamond Rock Hospitality. [more]

Half of the bidders in the war over Anglo Irish’s $9.5 billion U.S. real estate portfolio are now out of the race, the Wall Street Journal reported, including TPG Capital, which was once considered a front-runner.
While several of the firms are vying for specific parts of the portfolio, which is being marketed by Eastdil Secured and includes both performing and non-performing loans, others such as a Blackstone Group partnership, a partnership which includes LNR Property and Lone Star Funds are looking to bag the whole lot.
Others that made it to the second round include Colony Capital, H/2 Capital Partners and Area Property Partners.
The portfolio includes a loan on the Apthorp building at 390 West End Avenue.
Second-round bids are due next week, with Anglo slated to choose a winner by September. [WSJ]

While others in the property market focused their attentions on the Anglo Irish Bank portfolio bidding war, Wells Fargo & Co. has quietly beaten out 25 real estate investors and banks, including Lone Star Funds, Blackstone Group and TPG Capital, to win Bank of Ireland’s $1.4 billion U.S. commercial real estate portfolio for close to face value, sources told the Wall Street Journal. The sale has not yet closed.
The 25 loans included in the portfolio are backed primarily by property in New York, Boston and Washington, and are classified as performing, the Journal said.
Bank of Ireland has been deleveraging by selling off its foreign assets in bulk, after Ireland’s financial regulatory body instructed the bank to reduce its loan portfolio earlier this year by 25 percent, or $43 billion, by the end of 2013.
Holliday Fenoglio Fowler represented the bank in the deal. [WSJ]

From left: Blackstone co-founder Stephen Schwarzman, 229 West 43rd Street and Lev Leviev, chairman of Africa Israel

Private equity firm the Blackstone Group has completed its purchase of the top 11 floors of the 15-story former New York Times building at 229 West 43rd Street, according to public records filed with the city this morning.

As The Real Deal previously reported, the deal saw Blackstone pay developer Africa Israel USA and private equity firm Five Mile Capital $160 million for approximately 450,000 square feet of the building, which includes a portion of the fourth floor and floors five through 15.

“We are making a significant real estate contribution to the neighborhood for which we are proud,” Tamir Kazaz, CEO of Africa Israel USA, said in a statement in April about the sale. Kazaz said the company used the proceeds of the sale to pay down a portion of the $265 million first mortgage.
[more]

From left: Anglo Irish buildings the Apthorp in New York and Mandarin Oriental in Boston

Banks, private equity firms and investors may be tallying their resources as first-round bids for a $9.5 billion U.S. commercial real estate loan portfolio owned by failed lender Anglo Irish Bank are due tomorrow, Reuters reported.
However, anxiety among investors over the fluctuating capital markets may slightly reduce the offering prices, as the properties’ performances become more difficult to underwrite.
“With nervousness, everybody’s discount rate goes up and nobody knows exactly by how much. It makes it more difficult and likely makes it less valuable,” Richard Green, director of the University of Southern California’s Lusk Center for Real Estate. “If I’m bidding for something where I’m really uncertain about its value, I’m not going to bid as much.” [more]

In a sign of Wall Street’s recovering interest in commercial property, banks such as Deutsche Bank AG, Goldman Sachs and JPMorgan Chase are weighing bids for parts of Anglo Irish Bank’s $9.5 billion U.S. real estate portfolio, according to the Wall Street Journal.
The portfolio, the largest to hit the market since the start of the recession, offers a relatively low risk opportunity to jump back into commercial property, the Journal said, as the majority of debt is concentrated in large cities such as New York, California and Chicago. There are around 250 properties in total.
“It’s the first foreign bank to sell its entire U.S. loan portfolio, and it will be a good test of the market,” said Robert Ivanhoe, head of the global real estate practice for the law firm Greenberg Traurig. [more]