One of the country's largest office landlords has completed a $355-million recapitalization of its Universal City office building and said it intends to buy more property in Southern California.
Normandy Real Estate Partners owns 10 Universal City Plaza, the tallest building in the San Fernando Valley at 36 stories, in which NBCUniversal is the largest tenant.
Morristown, N.J.-based Normandy became the owner of the tower in mid-2009 when the previous owner defaulted on debt owed to Normandy. With more debt coming due, Normandy recapitalized in part through a newly formed joint venture with Morgan Stanley Real Estate Investing, which provided $138 million of debt and equity.
The 774,240-square-foot 10 Universal City Plaza is Normandy's only building in Southern California, but the company is looking to acquire more, Managing Principal Jeffrey Gronning said.
"We are big believers in investing on the coasts," he said. Property prices in Southern California have dropped significantly from their last peak, creating opportunity to buy buildings and improve them.
Normandy manages more than 15 million square feet of commercial property, mostly in the Northeast between Boston and Washington.
NBCUniversal last September agreed to renew its lease and expand in 10 Universal City Plaza. That 10-year commitment helped Normandy secure financing for the recapitalization, Gronning said.
California hotel foreclosures jump in 2011
The number of California hotels foreclosed on jumped 67% last year, but the bloodletting is expected to diminish in coming months as the hospitality industry recovers.
Lenders foreclosed on 230 hotels in 2010, up from 138 the year before, Atlas Hospitality Group said in a report. Among them were Hampton Inn & Suites Ontario, Country Inn & Suites by Carlson in Calabasas and the Ritz-Carlton Lake Tahoe.
The largest hotel to go back to the lender was the 331-room Hilton in Sacramento.
San Bernardino County saw the largest number of defaults with 31, followed by Riverside County with 24 and Los Angeles County at 21.
The number of hotels in default — a preliminary step to foreclosure — declined 12.2%, however, and Atlas expects hotel owners will continue to fare better as the economy improves. The number of hotels in default increased through the first half of the year and then leveled off.
"We are predicting that the number of hotel default filings will fall substantially in 2012, down 30% to 40%, and hotel foreclosures will be down 15% to 20%," Atlas President Alan Reay said. "There is no question that the hotel market has now bounced off the bottom and is in full recovery mode."
Westwood office building is sold for $39.5 million
A Westwood office building occupied by 20th Century Fox Studios and other entertainment industry tenants was sold for $39.5 million to Sun Life Assurance Co. of Canada, brokers said.
The financial services company bought 10351 Santa Monica Blvd., also known as Santa Monica Comstock Plaza, from a joint venture of Cambra Realty and Angelo Gordon, brokerage Madison Partners said.
The 101,000-square-foot building was completed in 1984 at Santa Monica Boulevard and Comstock Avenue near what is now the Westfield Century City shopping center. The sellers upgraded the property and rented the ground floor to Smith House Tap & Grill.
Other tenants include broadcaster BBC Worldwide Americas, U.S. Committee for UNICEF and Morgan Creek Productions.