Toll Brothers to Buy Seattle Builder

Toll Brothers Inc. said Monday that it is acquiring Seattle builder CamWest Development LLC for an undisclosed cash price.

The deal, which moves the luxury developer into the Pacific Northwest, is a rare example of an acquisition in the hard-hit home-building sector, which continues limping through the worst housing downturn in decades.

But Toll, based in Horsham, Pa., has weathered the downturn better than its peers. So far this year, its shares have fallen less than 1%, making it the sector's strongest performer. Shares of Hovnanian Enterprises Inc., another public builder, have fallen nearly 70% year to date.

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Brookfield Asset Management Profit Doubles After Power-Generation Gains

Brookfield Asset Management Inc. (BAM/A), the Toronto-based investment firm that manages about $150 billion, said third-quarter profit more than doubled on gains in power generation and commercial-property leasing.

Net income attributable to shareholders rose to $253 million, or 36 cents a share, from $112 million, or 16 cents, a year earlier. Cash flow from operations fell 32 percent to $241 million, the company said today in a statement.

Brookfield, led by Chief Executive Officer Bruce Flatt, focuses on property, infrastructure and renewable power and has sought to buy assets from troubled European companies. The firm raised $6.1 billion in capital in the quarter.


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Carlyle Cuts Fees to Sell New Fund

Carlyle Group, the large private-equity firm that is preparing for a public share listing, has had to cut fees and offer other unusual incentives to lure investors to a new $2.3 billion real-estate fund.

The fund, which is about to close, is one of the largest since the property bubble burst in 2008. But Carlyle's aggressive sales tactics reflect the reluctance of big pension funds to put new money into higher-return, higher-risk real-estate funds after suffering sharp losses during the financial crisis.

Carlyle has been offering large investors annual management fees of as little as 0.75% of assets, half the 1.5% industry standard, say people familiar with the matter. Carlyle also has raised the bar that must be cleared before the firm can share in the fund's profits, known in the industry as a hurdle rate or preferred return.


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Andrew Farkas Keeping Brokers Happy

Investor Andrew Farkas, who made a bundle by buying one of the city's leading commercial real-estate brokerages in 1996, looks like he wants to repeat his success with the purchase of Grubb & Ellis, a national firm.

But he better move quickly. If the firm's New York office is any measure, the brokerage has been seeing top people depart.

Since 2010, when David Arena, the firm's tri-state chairman, made a high-profile departure for J.P. Morgan Chase, the New York ...


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Goodbye to Circuit Citys and Old Navys; Hello, Gun Ranges, Aquariums, Go-Carts

Sobered by store closings and the rise of online shopping, owners of U.S. shopping centers are filling space and drawing visitors by turning to unusual tenants like gun ranges and go-cart tracks.

Mall giant Simon Property Group Inc. opened an aquarium in July at its Grapevine Mills mall near Dallas. Real-estate brokerage Jones Lang LaSalle Inc. put a fencing academy in a former Old Navy store in Florida's Tallahassee Mall, and a community theater on the lower level of a former Boscov's store in Harrisburg, Pa.

Even top performing mall companies—like Simon, which reported a 19% rise in earnings Tuesday—are looking at restaurants, entertainment and other nonretail uses as a hedge against the drain from online shopping. Glimcher Realty Trust purposefully filled 25% of its upscale Scottsdale Quarter mall near Phoenix with restaurants such as Stingray Sushi and services like Drybar, a salon that specializes in blow drying women's hair. "She can't go out to lunch and have a salad and a glass of wine with her girlfriends online," Glimcher Chairman and CEO Michael Glimcher said, referring to the mall industry's coveted female shoppers.

The Arms Room gun range near Houston had a mixed reception. Mr. James's attorneys advised him to seek written statements from Target and Home Depot declaring that they didn't object to his business opening in their shopping center. Home Depot agreed, but Target declined, Mr. James said. (Target declined to comment). Later, representatives of PetSmart Inc. thanked him for boosting the center's customer traffic.

Net lease Market one of the Hottest Commercial Real Estate plays in the Country

With money to burn but still having a strong aversion to risk, investors have increasingly turned single-tenant properties into one of the hottest commercial real estate plays in the country.

The single-tenant, net lease investment sales market is expected to continue growing, according to Jones Lang LaSalle.

"The low interest rate environment and the lack of safe-haven investment alternatives are driving new sources in build-to-suit and sale-leaseback activity, and investors have incredibly healthy appetites for stable and dependable income streams that single-tenant assets provide," said Guy Ponticiello, managing director Jones Lang LaSalle's Corporate Finance & Net Lease division.

Fully leased core properties have been highly sought-after by investors, often from overseas, and prices for these properties have been strong, according to Jane L. Mendillo, president and CEO of Harvard Management Co. in her most recent Harvard University Endowment report.

"We were able to sell some of our portfolio properties in this category at excellent values," Mendillo said. And now Harvard is ready to invest in new round of such properties.


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Default Swaps Penalize Westfield Group Most Since 2009: Australia Credit

Westfield Group is being penalized in credit markets more than global peers as the world’s biggest mall operator faces weaker sales growth in the U.S. and at home.
In Australia, data released yesterday showed consumer confidence has plunged 16.9 percent in the past year, while in the U.S. an unemployment rate over 9 percent for six months will limit retail sales growth during this year’s holiday season, the National Retail Federation said this week. For Westfield, the world’s biggest mall owner, that may increase vacancies and lower what it can charge tenants in its two biggest markets.


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