Starwood Capital Completes Arizona Portion of $191m Portfolio Sale

VIZZDA—January 31^st, 2014 — CW Capital, in its capacity as special servicer for several CMBS vehicles in care of US Bank, has completed the sale of eleven office and retail properties in five states—including four in the Phoenix market—for $191m. Starwood Capital paid cash for the properties, which total 1.595m square feet with 1.3m square feet of office in seven properties and 295k square feet of retail in four properties.

The four properties in the greater Phoenix market are split fairly evenly between office and retail, with two of each property type conveying for a total of $33,774,980 and $33,280,070, respectively. In terms of square footage, the office properties are over twice as large on the aggregate when compared to the retail properties, leading to a blended per square foot basis for retail of $142.40 compared to $67.85 for office. The Phoenix properties are as follows:

 

·  Retail

o  East Thunderbird Square North

§  166,102 square foot power center built 2000

§  Northwest of Scottsdale and Thunderbird Roads

§  Acquired by Starwood for $25,988,563 or $156.46 PSF

§  Prior Face Value Outstanding of $50m

§  Acquired by CW Capital August 2011 with a $16m credit bid

o  Greenfield Gateway

§  67,608 square foot Neighborhood Shopping Center built 2005

§  Southwest of Greenfield Road and US 60

§  Acquired by Starwood for $7,291,507 or $167.38 PSF

§  Prior Face Value Outstanding of $15.6m

§  Acquired by CW Capital February 2010 with a $10m credit bid

·  Office

o  Plaza Squaw Peak

§  427,852 square foot office complex built 1985-1987

§  Southwest of 16^th Street and Northern Ave

§  Acquired by Starwood for $24,067,843 or $56.27 PSF

§  Prior Face Value Outstanding of $50m

§  Acquired by CW Capital August 2012 with a $19.52m credit bid

o  Arrowhead Creekside

§  69,930 square foot office complex built 2000 and 2004

§  Northeast 75^th Avenue and Bell Road

§  Acquired by Starwood for $9,698,937 or $138.68 PSF

§  Prior Face Value Outstanding of $14.5m

§  Acquired by CW Capital July 2011 with a $6.7m credit bid

The $67.055m aggregate purchase price for the four Phoenix assets represent a 48.5% discount to prior face value outstanding of $130.1m. Three of the assets—East Thunderbird Square North, Greenfield Gateway and Plaza Squaw Peak—were securitized within the same instrument, a 2007-vintage CMBS vehicle underwritten by Countrywide Financial and Merrill Lynch. As an interesting historical aside, the super-senior tranche of this CMBS vehicle was secured by an $800m bridge loan for the 2007 acquisition of Peter Cooper Village and Stuyvesant Town by a joint venture between Tishman Speyer and Blackrock for $5.4b. The 2010 default on this note is the largest commercial mortgage default in US history.

By:

Paul Dionne

Director of Analytics

Vizzda.com