10 Must Reads for the CRE Industry Today (September 15, 2017)

Aerosoles has filed for bankruptcy, according to Reuters. The Wall Street Journal asks if Public hotel could take on Airbnb. These are among today’s must reads from around the commercial real estate industry.

  1. Footwear Maker Aerosoles Files for Bankruptcy “Women's shoe retailer Aerosoles said it had filed for Chapter 11 bankruptcy protection, the latest casualty in a struggling retail industry. The company had listed assets of $10 million to $50 million and liabilities of $100 million to $500 million, according to its bankruptcy court filing. Aerosoles' holding company AGI Hold said it would continue to manage its stores and operate its businesses as ‘debtors in possession.’” (Reuters)
  2. Neiman Marcus Is Shrinking the Store it’s Building in Manhattan “The Neiman Marcus flagship store that’s being built in Midtown Manhattan is getting downsized, The Post has learned. The Dallas-based luxury chain is in talks to reduce the swanky store’s square footage as it frets over developer Related Cos.’ ability to attract tenants and shoppers alike to the ambitious Hudson Yards project on Manhattan’s West Side, sources told The Post. One industry source briefed on the talks claimed the three-story, 250,000-square-foot Neiman store could see its floor space reduced by as much as 70,000 square feet.” (New York Post)
  3. Goldman Takes Stake in Under Armour CEO’s Boston Development “Under Armour Inc. Chief Executive Kevin Plank has snared Goldman Sachs Group Inc. as the first private investor in his ambitious Port Covington development project with a commitment of $233 million. The project seeks to transform a 235-acre industrial peninsula in South Baltimore into a $5.5 billion mini-city of offices, homes, stores, restaurants, parks and a new campus for the athletic-apparel company he runs.” (Wall Street Journal, subscription required)
  4. New Development: Soft in the Middle, Splashy Up Top “The slowdown hasn’t deterred some very ambitious projects that developers hope will break records with nine-figure price tags. Central Park Tower, a new addition to billionaire’s row on West 57th Street, between Seventh and Eighth Avenues, anticipates total sales in excess of $4 billion, according to documents filed with the State Attorney General. That would make it New York’s most expensive residential tower ever, said Gabby Warshawer, director of research at CityRealty, a real estate data firm.” (The New York Times)
  5. Is This Hotel an Airbnb Killer? “Stroll into Public, a full-service, 367-room hotel that opened this summer on Manhattan’s Lower East Side, and it quickly becomes apparent that certain features are nowhere to be found. Sure, there’s a coffee shop and market on the ground floor, complete with fresh fruit, local gourmet hot dogs and poke bowls. But in the lobby, an escalator ride up from the market, there’s no front desk, no concierge, no luggage…” (Wall Street Journal, subscription required)
  6. Equifax Hack: The Real Estate Industry is Just as Vulnerable “Last week, Equifax came clean about a cyberattack that compromised millions of Americans as well as an untold number of people in Canada. Names, birth dates, Social Security numbers, addresses and driver’s license numbers are among the potentially leaked information that could serve to negatively affect Americans for months or years to come. While the breach has caused uncertainty among the general population, it has also shed light once again on the possible ramifications of hacks in the commercial real estate industry if companies do not invest in cybersecurity tech.” (Forbes)
  7. What’s at Stake: Harry Macklowe’s Holdings Laid Bare at Divorce Trial “Mogul or frontman? It’s notoriously difficult to tell with developers. Figuring out how much of a stake a developer holds in a project takes an act of God — or, in some cases, a divorce. According to evidence presented at Harry Macklowe’s divorce trial Thursday, the founder and CEO of Macklowe Properties owns a mere 8 percent interest in the retail component at 432 Park Avenue. Macklowe and his partners paid CIM Group $450 million for the space in 2014 and, according to the court testimony, Macklowe’s investment in that deal is $15.7 million.” (The Real Deal)
  8. Do Designations Matter When Choosing a Commercial Real Estate Broker? “Commercial real estate transactions are some of the most important deals that a person or business can make. Finding the right commercial real estate can make or break a business venture. That is why people want the best professional commercial real estate broker available to guide them through the process. But how can you separate the best professional real estate brokers from the rest?” (Forbes)
  9. Guardian Life Insurance Subleases 148 SF from Coach at 10 Hudson Yards “While Coach did not disclose when Guardian Life will take occupancy of the space, the rent commencement date is February 2019 and the sublease will run through June 2036, per the filing. The insurer has agreed to pay a monthly base rent of approximately $790,000 from March 2019 through June 2019, with that number due to increase to a range between $1.1 million and $1.3 million from July 2019 through the end of the sublease.” (Commercial Observer)
  10. Phillips Edison Expands Holdings with Illinois Retail Buy “Phillips Edison & Co., a Cincinnati-based owner of grocery-anchored shopping centers, is continuing its aggressive expansion, adding Hoffman Village to its Illinois holdings. The 159,443-square shopping center in Hoffman Estates, Ill., a Chicago suburb, marks the 14th property in Illinois for the company. Hoffman Village, which is anchored by Mariano’s, a local grocer owned and operated by Roundys Supermarkets Inc., was acquired by the company’s Phillips Edison Grocery Center REIT I Inc.” (Commercial Property Executive)
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