Sternlicht's $10B SREIT Faces Liquidity Crunch Amid Rising Redemptions

Together with

Good morning. Starwood's $10B property fund faces liquidity issues as investors withdraw. Plus, NAIOP's latest survey shows a positive outlook for CRE, with a Sentiment Index score of 52, the highest in two years.

Today’s issue is brought to you by Viking Capital.

Brokers, tenants, landlords: The Super Bowl of retail RE is happening this week in Vegas! Remember, you are here for business. Happy networking!

Market Snapshot

CREDIT CRUNCH

TOGETHER WITH VIKING CAPITAL

Multifamily Investment Opportunity

Introducing Villas at Sundance, a premier 252-unit multifamily gem in New Braunfels, Texas. Built in 2012, this asset offers a a strong investment opportunity in the bustling Texas Innovation Corridor, strategically located between Austin and San Antonio.

Why Villas at Sundance?

🏡 Prime Location: New Braunfels is the "Third Fastest Growing City in the Country," boasting a staggering 40% population growth in just five years.

💰 Exceptional Value: Viking Capital secured this asset at a significant discount, leveraging the city's growth and low-cost basis to offer investors an unparalleled opportunity.

To learn more, join Viking Capital for an upcoming Fed Fund & Deal Dynamics webinar on May 22nd at 7 PM.

EDisclaimer: No information in this email should be used as or considered an offer to sell or a solicitation of any offer or invitation to buy any securities or interest in any issuer company. Past performance is no guarantee of future results and should not be relied upon as an indicator of the Partnership’s future performance or success.

• Distress deal: Morgan Stanley may soon acquire $700M of Signature Bank's CRE loans from a group comprising Blackstone Inc., Canada Pension Plan Investment Board, and Rialto Capital.

• Island life: Bird Key, a historic undeveloped island in Biscayne Bay, is on the market for $31.5 million, leaving the fate of the centuries-old wildlife retreat uncertain after the owner rejected Miami Mayor Daniella Levine Cava's 2023 purchase offer.

• Industry icon: Donald R. Horton, founder of America's largest homebuilding firm, passed away suddenly at 74. RIP legend.

• Bull vs. Bears: Big CRE fund managers see current investment conditions as "once-in-a-generation," especially in debt investments, while global investors remain cautious.

• Southern surge: Thirteen of America's 15 fastest-growing cities are in the South, according to a new U.S. Census Bureau report.

• Record sale: Palm Beach's priciest home sold for $152 million, the highest residential sale in Florida this year, despite a 30% discount off the original asking price.

• King of the South: Atlanta has been crowned the best U.S. city for starting a career again, thanks to strong starting salaries and a proliferation of entry-level jobs.

• Boomer shift: Increasingly, Baby Boomers prefer renting over buying homes, with 80% now favoring renting, up from 63% last year, according to a Bank of America report.

• A BIG deal: Ares Management acquired a 284-unit apartment building in Boca Raton for $139.7 million, the largest multifamily sale in South Florida this year.

• Bronx rezoning: New York City's Planning Commission has started public hearings on rezoning to support the construction of 7,500 homes near new Metro-North stations in the Bronx.

• Chicago surging demand: The Chicago Plan Commission approved three large multifamily projects in the rapidly growing West Loop and Near Northwest Side neighborhoods.

• Tax-exempt financing: Jemcor Development Partners and Pacific Housing secured $107 million to build 300 affordable apartments in Downtown San Jose after purchasing two lots.

• Delayed: Several subcontractors are awaiting over $1 million in payments from an out-of-state developer after months of work on an affordable housing project in Richmond’s Southside.

• Sewer fees: Los Angeles City Council voted to double sewer fees over the next four years, despite business groups' objections.

• Cool heads: The climate-controlled storage sector, valued at $36.9 billion in 2023, is projected to grow 17.5% annually by 2030, highlighting its rising importance in the industrial market.

• Another one: After a billion-dollar purchase from Blackstone, Rexford Industrial Realty acquired a 279,000-square-foot warehouse in Fullerton for $94.2M, at approximately $338 PSF.

• Thirty Ink: Stephen Curry bought a 10,000-square-foot commercial building in San Francisco for $8.5 million to serve as the new hub for Thirty Ink, with redevelopment approval.

• FL lease: BroadRange Logistics has signed its first South Florida contract, leasing the entire 1M SF Interstate Crossroads Logistics Center in Fort Pierce, Fla., to be occupied later this year.

• Queens buy: J.P. Morgan Real Estate Income Trust acquired a 95% interest in Shops at Grand Avenue in Queens for $48 million, increasing their portfolio to over $400 million.

• Tenant rumble: Robert Rivani’s Black Lion is in a legal battle with a tenant who allegedly backed out of opening a restaurant at Wynwood Jungle in Miami.

• Value retail: A private equity firm, backed by the world's richest man, is negotiating to buy a £1.4B stake in the company owning Bicester Village outlet.

• Dallas history: KFK Group is selling One Main Place, a historic 33-story office building in downtown Dallas with over 650,000 square feet of office space, currently 36 percent occupied.

• A win for offices: Blue Cross Blue Shield of Texas is expanding its presence in Houston with an 11-year lease for nearly the entire 134,700-square-foot West Belt Office Center I building.

• Open for business: Compared to pre-pandemic levels, the CMBS market has slowed down. However, Q1 saw around $1.7B in hotel-related debt issuances, up 45% YoY.

• Let’s make a deal: Mohari Hospitality and Weller Development Partners are launching a $2.5B investment in luxury hospitality and mixed-use projects across North America and the Caribbean.

• Foreclosure auction: Harris Bay's once-promising hotel project on the San Antonio Riverwalk at 151 East Travis Street is up for auction after the firm defaulted on a loan from Equity Secured Capital, owing approximately $2.1 million.

📈 CHART OF THE DAY