Retail chain J.C. Penney has agreed to allow Vornado Realty Trust to increase its stake in the company, relaxing a restriction put in place last year to limit the number of shares the real estate investment trust could buy, Dow Jones reported.

The change of heart, disclosed in a filing by J.C. Penney yesterday, is just the most recent piece of evidence in the deepening relationship between Penney and Vornado. It allows Vornado to increase its stake to 15.4 percent from 9.9 percent, including through a synthetic long position” using the derivatives market. Vornado holds a seat on J.C. Penney’s board, Dow Jones said.

Vornado and Bill Ackman’s Pershing Square Capital both have stakes in the department store chain. [more]

555 California Street in San Francisco
From the New York August issue: Vornado Realty Trust is close to securing a loan on its 52-story tower at 555 California Street, according to Bloomberg News. Lenders Pacific Life Insurance and MetLife are on track to win the assignment, beating out Wall Street banks competing to package the loan for sale. The 1.5 million-square-foot tower, home to Bank of America’s San Francisco headquarters, was built in 1969 and featured in the 1974 film “Towering Inferno,” starring Steve McQueen. It is the fifth-tallest building on the West Coast, according to data from Emporis. Banks have been competing for loans on top-tier buildings to bundle into bonds, Bloomberg said. “We’re going to focus on high-quality assets,” said Robert Merck, senior managing director and head of retail investments at MetLife. Click here to see the rest of the news from around the nation. Compiled by Katherine Clarke

Frustrated with the scarcity of properties for sale, some of the nation’s biggest real estate investment trusts are going global. Vornado Realty Trust, which previously focused mostly on investing in the U.S., has entered a bid for the global Dutch financial company ING Groep NV, according to the Wall Street Journal. ING generates management fees and could offer Vornado teams in Europe and Asia who would manage property and look for deals. An ING spokesperson declined to comment on Vornado’s involvement, but said the Dutch bank is “conducting an evaluation” of the REIT business, which has about $100 billion in assets. In addition to Vornado, private equity firm Kohlberg Kravis Roberts & Co. and affiliates of CB Richard Ellis and Jones Lang LaSalle are among the firms still pursuing the business, people familiar with the matter said, with final bids due Dec. 1. Other U.S. office landlords, including Brookfield Office Properties and SL Green Realty, also did overseas deals in recent months. But overseas acquisitions have stirred controversy, with some investors and analysts skeptical about the amount of deals available for U.S. REITS outside the country. [WSJ]

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Two of New York City’s biggest real estate investors announced they’d become shareholders in one of the nation’s most ubiquitous department store chains, J.C. Penney. The larger investor, Bill Ackman’s Pershing Square Capital, which purchased a 16.5 percent stake in the company, valued at $900 million, is assumed to be in a deal with Vornado Realty Trust, a real estate investment trust, which disclosed its own 9.9 percent stake in the company, as well. Vornado and Pershing have a history of separately investing with big-box retailers, including Toys ‘R’ Us and Barnes & Noble, respectively. “[Pershing] in conjunction or in partnership with Vornado… are coming after J.C. Penney to try to extract what they believe is more value in that stock,” according to the CNBC video above. “Whether there’s real real estate value with J.C. Penney, it’s something of an open question.” TRD

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Vornado Realty Trust, the New York City-based landlord which also owns shopping centers in Miami and Tampa, posted a $200.3 million first-quarter net income. That’s a significant increase over the net income from the same quarter a year earlier, which reached $125.8 million, according to a report from the company released today. The resulting funds from operations reached $1.87 per share to common shareholders. This FFO is up from $1.65 per share seen in the first quarter of 2009. TRD

In the three months since its initial public offering, Apollo Commercial Real Estate Finance lost $1.72 million, or $0.16, per share, the company reported yesterday. Vornado Realty Trust also posted a $151.2 million net fourth quarter loss, or $0.84 per share. Vornado’s loss represents an improvement over the fourth quarter of 2008, when it took a $227 million hit. Apollo, which began operations Sept. 29, 2009, expects better results in 2010, said Stuart Rothstein, the company’s CFO. “We are well positioned to generate results in 2010 which should reflect net investment income based on the continued deployment of capital and a normalized expense level consistent with a full year of operations,” Rothstein said. TRD

Vornado Realty Trust saw net income attributable to shareholders at $126.3 million in the third quarter this year, according to a report released this morning, compared to the third quarter a year ago when that figure was just $22.7 million. The jump marks a five-fold increase in Vornado’s income year-over-year. This comes to an income of $0.69 per diluted share this past quarter, compared to $0.14 during the same time period a year ago. The year-over-year difference comes as Vornado has been preparing to rapidly snap up the “stupid, stupid, stupid cheap” assets that have amassed in the down market, as The Real Deal previously reported. TRD