National Cheat Sheet: Blackstone Group plans to become a corporation, NAR hit with new antitrust suit … & more

By Maya Rajamani | April 19, 2019 10:00AM

Clockwise from top left: Warner Bros. strikes major deal for its Burbank Studios, more U.S. retail stores have shuttered this year than all of last year, Blackstone Group plans to change its corporate structure effective July 1 and home sellers file another suit against NAR claiming inflated buyer-broker commissions.

Blackstone Group plans to change its corporate structure effective July 1
Blackstone Group plans to become a corporation in an effort to “make it significantly easier for both domestic and international investors to own [its] stock,” CEO Stephen Schwarzman said. The change in corporate structure will go into effect on July 1, the company said. The move follows in the footsteps of competitors KKR and Ares Management corp., which already changed their corporate status. News of the conversion came a day after the Wall Street Journal reported the group was thinking about selling its Cosmopolitan hotel and casino in Las Vegas, tapping Deutsche Bank and PJT Partners as it mulls “strategic alternatives” for the property. [TRD]

Home sellers file another suit against NAR claiming inflated buyer-broker commissions
Another antitrust lawsuit is claiming that the National Association of Realtors is involved in inflating buyer-broker commissions, Inman reported. The latest suit alleges NAR and four major brokerages — Realogy, HomeServices of America, RE/MAX and Keller Williams — are “conspiring to require property sellers to pay the broker representing the buyer of their properties, and to pay an inflated amount” in 20 different areas. A Minnesota home-seller filed a similar suit against NAR last month. NAR called the most recent lawsuit “baseless” and said it “contains an abundance of false claims.” [TRD]

More U.S. retail stores have shuttered this year than all of last year
More brick-and-mortar stores have closed in the first few months of 2019 than in all of 2018, according to the Wall Street Journal. A total of 5,864 stores closed across the country last year, the outlet reported, citing data from Coresight Research; this year, 5,994 stores have already closed. Chains including Payless ShoeSource, Gymboree Group and Charlotte Russe Holding, however, have already announced closures this year, and malls are still struggling. “I don’t think malls are out of the woods yet,” S&P Global Ratings analyst Ana Lai told the outlet. [TRD]

MAJOR MARKET HIGHLIGHTS

Warner Bros. buying Burbank Studios property as part of $1B deal
Warner Bros. plans to buy the lion’s share of its 35-acre Burbank Studios property from Worthe Real Estate and Stockbridge Real Estate Funds as part of a deal valued at around $1 billion. The company, which is about the celebrate its centennial, said it will also move into two Frank Gehry-designed buildings that Worthe and Stockbridge are currently developing on the property’s seven remaining acres. As part of the deal, Worthe and Stockbridge will buy four Warner Bros. properties, including its ranch on Hollywood Way. Warner Bros. is expected to move its operations from the four properties to Burbank Studios. [TRD]

San Francisco surpasses New York City as the most expensive place to build
San Francisco is now the most expensive place in the world to build, according to a new Turner & Townsend International Construction Market survey. The city’s average building cost of $417 per square foot surpassed New York’s $368 per square foot cost, the survey said. New York, however, still has higher labor costs than San Francisco, with an average $101.30 per hour and $90 per hour, respectively. Builders several in U.S. markets face a number of challenges, including tariffs and a shortage of skilled labor, the report said. [TRD]

Google backs out of plans to open first permanent retail store in Chicago
Google is no longer planning to open its first retail store in Chicago, the Chicago Tribune reported. The tech behemoth was in “advanced negotiations” to launch its store in a 14,000-square-foot space in Fulton Market last year, but decided not to move forward with the deal, according to the outlet. Google declined to comment on the reversal, and Newcastle Limited, which owns the building the company had planned to move into, couldn’t be reached for comment. Google has opened a number of pop-up shops across the country, but hasn’t ever opened a permanent retail location. [TRD]

Indiana vacation town with three residents is up for sale
An entire Indiana town has hit the market for the first time in two decades, the New York Post reported. Rock Hofstetter, who bought Story, Indiana back in 199, is now selling it for $3.8 million, according to the outlet. The town near Indianapolis has around 12 buildings and three human residents, but Hofstetter and two co-owners run a bed-and-breakfast called the Story Inn that has made the town a popular vacation spot. The three plan to rent the inn from whoever ends up buying the town. [TRD]

NYC landlord sent threatening letter to rent-regulated tenants, lawsuit claims
A New York City landlord allegedly sent two rent-regulated tenants a handwritten note along with their rent statement that said: “If you love your children, leave the building.” The Upper West Side couple have filed a lawsuit claiming Simon Baron Development sent the note as they were negotiating a buyout; the couple occupies two units in the building that are valued at around $18 million. Simon Baron, for its, part, has filed five lawsuits against the couple in an attempt to evict them from the building. The couple’s lawsuit claims they received the letter after rejecting a $1 million buyout. [TRD]

Florida man who owns $8M private island stole from Kmart, police say
A Florida man who owns a number of properties off of Key West, including a private island he bought for $8 million, was arrested for stealing from a Kmart store, according to the New York Daily News. Andrew Lippi, who bought Thompson Island last month, bought several items from the store and got refunds by either returning a different item, or returning them without their original pieces, according to the outlet. One of the items Lippi bought was a Keurig coffee maker; he allegedly returned the Keurig container the next day with a basketball inside. [TRD]