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Shorenstein Beefs up Transactions Group
By Brian K. Miller - GlobeSt.com
April 27, 2004 - Shorenstein Co., a locally headquartered owner and operator of class A office properties, has found a point man for its West Coast acquisition activity. Andrew Friedman, formerly with Lend Lease Real Estate Investments, has been named a managing director of the firm's Capital Transactions Group.
Friedman, a 20-year veteran of the local commercial real estate scene, will be based in San Francisco. The two other senior members of the company's Capital Transactions Group, Gentry Hoit and Bob Underhill, are based in New York.
From 1988 to 2004, Friedman was responsible for all West Coast commercial real estate acquisitions at Lend Lease Real Estate Investments Inc., where he managed a portfolio valued in excess of $3 billion. Friedman joined Morgan Stanley in 2003 when Morgan Stanley acquired Lend Lease, and continued to focus on West Coast transactions. Prior to Lend Lease, Friedman was an associate in Booz Allen Hamilton's San Francisco office.
Shorenstein owns and operates a portfolio totaling more than 20 million sf. Since 1992, the company has sponsored a series of closed-end real estate investment funds that have invested in class A office projects located throughout the US. Investors in these funds include foundations, college endowments, pension funds and high net-worth families.
In February, Shorenstein announced the closing of Shorenstein Realty Investors Seven LP, a $775-million real estate investment fund formed to invest in class A office properties in the US. With Shorenstein typically using acquisition debt in the range of 60% to 65% of cost, the fund will have capacity to acquire approximately $2.2 billion in office assets. The fund was first opened to subscription in July 2003. No funds have yet been invested. The fund will pursue the same strategy as Shorenstein's previous funds, seeking to acquire large, complex and management-intensive office properties in major US markets wherein Shorenstein believes it can add value via its in-house investment, asset management, leasing and operating staff. All told, Shorenstein has initiated six previous funds that attracted $1.5 billion in total equity. Four of the funds are fully invested and none has been fully liquidated. The funds have acquired and developed about 16 million sf of class A office properties throughout the US. The equity invested in Shorenstein Realty Investors Seven, the company's largest fund to date, is equal to about 50% of all equity invested in the previous six funds. Some of the properties acquired by Shorenstein's previous funds include 500 West Monroe St., a 959,000-sf building in Chicago; 450 Lexington Ave., a 911,000-sf building in New York City; Bay Colony Corporate Center, a one million-sf office park in suburban Boston; Hamilton Square, a 237,000-sf building in Washington, DC; Hills Plaza, a 609,000-sf development in San Francisco, and; First Union Financial Center, 1.1-million-sf building in Miami.
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