Buyer-Seller Divide Bridged in Pittsburgh with Financing, Improved Pricing
Wall Street Journal reports: Signaling that the buyer-seller standoff over pricing that has impeded commercial real estate investment activity since the downturn may be gradually receding, the Wall Street Journal recently revealed that a group of New York-based investors has reached a deal to buy Pittsburgh’s US Steel Building. The building’s current owners, a joint venture between AREA Property Partners and Winthrop Realty Partners, have agreed to sell the 64-story tower to the Mark Karasick-led group for $250 million. The sale was partially spurred by the property’s debt load; AREA used the property to back $225 million in loans in 2005 that came due last September.
The Journal postulated that AREA had postponed selling its debt-laden asset until the market's pricing had improved to the point where a sale made sense. It also added that Mr Karasick’s consortium had held off on the purchase until it was able to secure 70 percent or more of the property’s sale price in financing. Said the Journal of these stipulations, “The tentative deal speaks to the availability of capital in the commercial-real-estate sector, as owners are finding it far easier to sell at palatable prices than just six months ago. With lending markets loosening, commercial-property sales nationally rose to about $50 billion in the last three months of 2010, up 60% from the prior quarter, according to research firm Real Capital Analytics.”
View the full article on Wall Street Journal: Buyer-Seller Divide Bridged in Pittsburgh with Financing, Improved Pricing
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Posted by: Nina Turner