HILTON MAKES HEADLINES AGAIN
LOS ANGELES (San Antonio Express-News) – Hilton Hotels Corp. has agreed to an all-cash buyout from Blackstone Group. The sale, valued at $26 billion including debt, would instantly make Blackstone the world's largest hotel owner.
Blackstone said it would combine cash from its real estate and corporate private equity funds to buy all outstanding Hilton shares for a 32 percent premium, or $47.50 each.
Blackstone currently owns more than 100,000 hotel rooms in the United States and Europe, including La Quinta Inns and Suites and LXR Luxury Resorts and Hotels. With this multibillion-dollar deal, the company will control a hotel empire with nearly 600,000 rooms worldwide.
Adding the Beverly Hills–based Hilton Hotels will bring an additional 2,800 hotels and more than 480,000 rooms in 76 countries and territories, and it will include such brands as Doubletree, Embassy Suites and Hampton Inn.
While Hilton franchises the majority of its hotels, the company owns some valuable real estate including the Waldorf-Astoria in New York. Blackstone said it intends to invest heavily in Hilton and does not foresee any significant divestitures.
Pending shareholder approval, the sale will finalize at year’s end.
MIXED-USE ARBORETUM UNDER DEVELOPMENT
AUSTIN (Austin American-Statesman) – Land Creek Development and Ash Creek Homes will develop Arboretum Park, a mixed-use community, at 9707 Anderson Mill Rd.
Retail and office space will be housed in three one-story buildings totaling about 18,000 square feet. Arboretum Park will also have a gated community of 39 garden homes.
The commercial portion will be ready in November, and the garden-home community is slated for grand opening late next year.
GOODBYE BRIAR MEADOWS, HELLO CORNERSTONE
HOUSTON (globest.com) – MBS Cos., based in Louisiana, has sold the 256-unit Briar Meadows Apartments in the Memorial district and purchased the 352-unit Cornerstone Ranch Apartments in Katy.
The 91 percent occupied Briar Meadows has units ranging from studios to three bedrooms, with rents of $607 to $1,500. Cornerstone Ranch, at 95 percent occupancy, has one-, two- and three bedroom units, with monthly rents from $708 to $1,300.
Briar Meadows at 1414 S. Dairy Ashford St. was sold to Austin-based Falcon Southwest. Cornerstone Ranch at 2002 S. Mason Rd. was purchased from its developer, Judwin Properties of Houston.
Apartment Realty Advisors' Houston office assisted in the transactions, which occurred close together but were not an exchange.
RENTS AND VACANCY RATES RISE
AUSTIN (Austin American-Statesman) – Rents for top-tier office space reached their highest level since early 2001, while vacancies also rose from the previous quarter, when they had reached their lowest level in six years, according to Oxford Commercial.
Rents for Class-A space averaged $29.52 per square foot (psf) in this year’s second quarter, up 23 percent from $23.92 a year ago, while vacancy dropped to 11 percent from 15.9 percent during that same time.
Rents for all types of office space continued their two-year climb to the average of $24.68 psf.
The overall vacancy rate stood at 13.6 percent, up from the previous quarter's 11.8 percent but still down from 17.4 percent in mid-2006. The vacancy rate increase was the first after three consecutive quarterly declines.
Central Texas' strong job growth, which was at a 4.1 percent annual rate in May, continues to drive demand for office space. Projects currently underway will add more than 1.3 million square feet this year.
CONSOLIDATING PLASTICS
GEORGETOWN (Austin American-Statesman) – Plastics manufacturer R&D Molders is consolidating two Central Texas facilities into one 60,000-square-foot industrial facility north of Westinghouse Road and east of I-35.
The company's move to 107 Park Central Blvd. will add 48 jobs to the local economy.
NEW LOOK, NAME FOR PARKWOODS
DALLAS (The Dallas Morning News) – Mayo Group has purchased the 818-unit Parkwoods Apartments at 3035 W. Pentagon Parkway.
The New England-based real estate investor will remodel the complex and change the name to Tierra Linda.
DRAMATIC SLOWDOWN OF APARTMENT RENTALS
DALLAS (The Dallas Morning News) – The pace of apartment rental has slowed dramatically according to the latest numbers released by apartment consultant M/PF YieldStar.
Average monthly apartment rents at the end of June were up about 1 percent from a year ago to $716.
"Results for the second quarter fell way below expectations," said Greg Willett of M/PF YieldStar, with virtually no increase in apartment rentals.
A net 300 units were leased during this year’s first half, compared with the more than 7,000 net apartments leased in the same time last year.
Homebuilder giveaways and for-rent homes are in direct competition with the apartment market.
"The number of single-family homes available for rent appears to be way up, even though many aren't getting rental rates that actually cover mortgage costs," Mr. Willett said.
Dallas–Fort Worth leads the country in teardowns, mostly to create redevelopment sites. More than 3,500 area apartments were demolished in the last six months. Even so, overall vacancy rates inched up to about 7 percent.
Almost 13,000 units are in the construction pipeline, mostly in central Dallas and in the Las Colinas area, according to M/PF YieldStar's latest estimate.
FAMILY-FRIENDLY CITY
CEDAR PARK (Austin Business Journal) – Family Circle magazine has named Cedar Park, which is about 25 miles north of Austin, one of the best communities nationwide for families.
For its August 2007 issue, the magazine partnered with New York–based research firm On Board to look at 1,850 cities and towns across the country with populations between 15,000 and 150,000 and a high concentration of households with an average income of $65,000.
Narrowing the selections to the top ten, On Board and Family Circle then looked at criteria including cost of living, jobs, green space, health care and air quality.
SENIOR HOUSING NEARS COMPLETION
ABILENE (Abilene Reporter-News) – Construction on Arbors at Rose Park, the new senior housing complex on South 7th Street, is nearing completion, and a September grand opening is expected.
DMA Development Co. in Austin developed the 80-unit facility, which is across from the Rose Park Senior Activity Center.
The apartment complex will serve low- to moderate-income senior citizens, with rents ranging from $196 to $670.
JUST WHAT THE DOCTOR ORDERED
NEW BRAUNFELS (mysa.com) – San Antonio developer Koontz McCombs will break ground by the end of the year on an 84-acre development that will include residences, medical facilities and assisted-living units.
Sundance Park has already attracted several medical businesses.
- Locally based McKenna Health System has bought ten acres for 30 independent-living cottages, independent-living apartments and a 50-unit assisted-living facility.
- Austin-based nursing home company Trisun Healthcare has bought six acres.
- An oncologist who runs cancer treatment centers in San Marcos and Kerrville is planning to build a third clinic there.
Medical offices will also be built on speculation.
Sundance Park, near Common Street and FM 306, is about two miles from the 414-acre Creekside development, which is expected to include a hospital, a medical office park, retail and apartments.
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