The Real Deal New York

National Cheat Sheet: Fannie and Freddie fight with the Trump administration, CushWake undergoes leadership shakeup amid IPO rumors … & more

By James Klatell | November 30, 2017 02:30PM

Clockwise from top left: Office space in Los Angeles is on the rise, Microsoft’s major renovation plans in Redmond, Mast Capital CEO Camilo Miguel Jr. has designs on the Miami River, 7INK by Ollie could be a ‘millennial resort’ in Boston, and FHFA Director Melvin Watt faces choices about Fannie and Freddie.

Fannie and Freddie fight over $7.7B with Trump administration
Fannie Mae and Freddie Mac will owe the Treasury Department more than $7 billion at the end of the year, and the agencies are fighting with the Trump administration over how to settle the bill. Officials from the Federal Housing Finance Agency want Fannie and Freddie to keep between $2 billion and $3 billion to protect themselves against losses, according to Bloomberg. The White House, however, wants them to limit their market footprint as part of the deal, by enforcing more restrictive limits on the loans they back. [TRD]

Lickerman out as Cushman’s top Americas executive
Cushman & Wakefield’s chief executive of the Americas Tod Lickerman is leaving the Chicago-based commercial real estate services firm. Shawn Mobley, president of the firm’s East Region and the leader of the Chicago offices, will replace Lickerman, who joined Cushman in 2013. The leadership changeup comes as Cushman reportedly gears up to go public. [TRD]

Home prices increased by 6.2% in September: report
Nationwide home prices are rising faster than any time since 2014, according to the S&P CoreLogic Case-Shiller Index. September’s 6.2 percent increase slightly outpaced the 6.1 percent growth predicted by a Reuters poll of economists. Thirteen cities reported that prices had gone up in the year, with Seattle, Las Vegas and San Diego leading the way. [TRD]

GOP tax plan could drastically slow down construction and rehab of affordable projects
The tax proposals being debated in Washington could slow down both the construction and renovation of affordable housing units if the “private activity” bond tax exemption is eliminated, as it is in the recently passed House bill. An analysis by accounting firm Novogradac & Co. found that the bill would lower affordable housing production by about 700,000 units over the next 10 years. The Senate’s tax plan does not eliminate the exemption, but supporters of the House plan say its end is needed to pay for other corporate tax cuts. [TRD]

Piedmont selling 14 buildings across the country for $426M
Piedmont Office Realty Trust is selling 14 buildings across the country in a deal with two unnamed buyers. The properties comprise 2.6 million square feet of office space in Arizona, Michigan, Florida, Tennessee and Massachusetts. The deal is valued at $425.9 million, but as much as $10 million could be added if certain leasing targets are met within six months. [Bisnow]

HNA mulls selling assets amid pressure from Chinese government
As the Chinese government tries to limit the amount of capital flowing out of the country, HNA Group may sell off some of its $45 billion of global investments. Adam Tan, CEO of HNA Group, he was considering selling buildings and holdings in industries restricted by the Chinese government. Asset sales would help HNA pay off more than $100 billion in debt. [TRD]

MAJOR MARKET HIGHLIGHTS

Los Angeles expected to add 1.73M square feet of new office space in 2018
About 1.73 million square feet of new office space is expected to be delivered in 2018 in Los Angeles, according to a new study by Commercial Cafe. With 98.4 million of existing office space in the city, eight new projects are scheduled to come online soon, with the largest being the Hercules Campus in Playa Vista at about 525,000 square feet. All the new inventory has some industry experts worried, however, as the office vacancy rate in the county rose to 14.4 percent in the third quarter of 2017, according to a report by CBRE. [TRD]

Mast Capital proposes massive mixed-use project along Miami River
Miami Beach-based Mast Capital is proposing to build a massive mixed-use project along the Miami River, according to documents filed with the Miami River Commission. The planned development would have nearly 700 residential units, 800 parking spaces and commercial and retail space. Mast is under contract to buy the 6.31-acre site, which has more than 1,000 feet of river frontage. [TRD]

Microsoft plans to reboot Seattle’s Redmond campus with multi-billion dollar expansion
As Amazon is spending billions on development in Seattle and on a second headquarters somewhere in North America, Microsoft is going to invest its billions in a renovation and expansion of its suburban campus in Redmond, Washington. The tech giant announced that it will demolish 12 of the oldest 80 existing structures, construct 18 new buildings and renovate others. Microsoft plans to add 2.5 million square feet in new office space and renovate another 6.7 million square feet. [Seattle Times]

Developers pitch a 14-story ‘millennial resort’ in Boston
The newest luxury residential tower to join Boston’s skyline might just be an experiment in “co-living.” Newton-based National Development and New York-based real estate company Ollie are proposing a 14-story building with 245 small units for the South End’s Ink Block complex. “You walk into this building and you feel like you’re in a millennial resort,” National Development managing partner Ted Tye told the Boston Globe. The proposed tower, dubbed 7INK by Ollie, needs approval from the Boston Planning and Development Agency. [Boston Globe]

Staten Island, New York’s forgotten borough, is making itself known
With rising prices and large developments, Staten Island could be shedding its reputation as New York’s forgotten borough. On Staten Island’s North Shore residential and commercial prices have risen 30 percent since 2012, but land is selling at about $80 per square foot on buildable land — well below the city average. Triangle Equities and Starwood Hotels & Resorts are building a 175-key Westin hotel and BFC Partners are working on the 100-store Empire Outlets NYC in the borough. [TRD]