Courtesy of Jackson-Shaw

Jackson-Shaw Founder Lewis Shaw II passed away at 82.

Lewis Shaw II, who founded Dallas-based Jackson-Shaw and grew it into a major national player that has completed 63M SF of development, has died. 

Shaw was 82 at the time of his passing on March 5 following a brief illness, D Magazine reported.

Shaw grew up in Ohio and graduated from Wittenburg University in 1966, according to an obituary. After college, he spent seven years in the U.S. Air Force. He moved to Dallas after the Air Force and worked at IBM for a short time.

Shaw met Jim Jackson and joined his small contracting firm, J.C. Jackson Co., in 1974. Jackson died a few years later, and Shaw bought the company and renamed it Jackson-Shaw. He would go on to grow it to a national development firm and complete $3.6B in transactions, according to the firm’s website.

The company has expanded in several markets including Austin; Charlotte, North Carolina; Jacksonville, Florida; and Las Vegas. Its recent projects include the 535K SF Greensport Logistics Park in Houston and a 1.7M SF Lakeview Business District project in Rowlett, Texas.

Shaw also co-founded American General Hospitality Inc. in 1980, a company that merged with Meristar Hotels & Resorts 18 years later.

He was inducted into the North Texas Commercial Association of Realtors Hall of Fame in 2003 and was part of the Wittenberg University Board of Directors, the Dallas Business Journal reported. 

Life science REIT IQHQ said Tuesday it had entered into an early lease renewal and long-term extension with Generate:Biomedicines at the Innovation Park life science district in Andover, MA. Innovation Park houses Generate’s 75,000-square-foot cryogenic electron microscopy laboratory, one of the largest laboratories of its type in the U.S.

IQHQ acquired the Innovation Park campus between 2020 and 2021 and developed it into a 340,000-square-foot life science hub for leading biotechnology and life science manufacturing companies in the greater Boston market. “We are proud that Generate:Biomedicines, a global leader in generative biology, has made a long-term commitment at IQHQ’s Innovation Park district to accelerate breakthroughs in therapeutic discovery and development at their cutting-edge CryoEM laboratory,” said Tracy Murphy, co-CEO and co-founder of IQHQ.

Innovation Park is one of four life science districts IQHQ owns in Greater Boston. Leasing at the park is overseen by Colliers’ Curtis Cole and Tim Allen.

Gordon Rees Scully Mansukhani, LLP (GRSM), one of the largest law firms in the country with offices in all 50 states, has committed to an 11,500-square-foot office lease at Eastman Companies’ The Eisenhower, a Class A office complex located at 290 W. Mount Pleasant Ave. in Livingston, NJ. The law firm has relocated its NJ offices to the prominent office property.

The CBRE team of Jon Meisel, Erin Wenzler and Dan Casey spearheads the leasing campaign at The Eisenhower and represented Eastman Companies in the negotiations. Gordon Rees was represented by Bill Montana of Savills.

“The Eisenhower continues to attract strong tenants who view the building as the best option for Class A office space in the Livingston area,” said Meisel. “After an exhaustive search of the market, The Eisenhower proved to be the best choice for GRSM due to its strong, stable ownership, unmatched on-site amenities, and efficient layouts ideal for a law practice.”

Courtesy of Denholtz Properties

Denholtz Properties CEO Katie Kurtz

Katie Kurtz is trading in glassy Manhattan skyscrapers for squat New Jersey commercial buildings.

Kurtz, who has been the chief financial officer and co-chief investment officer at Silverstein Properties since 2021, was named CEO at Denholtz Properties, a Red Bank, New Jersey-based firm that develops suburban apartments, offices and industrial buildings.

Steven Denholtz, the developer’s longtime CEO who has been with the company since 1983, will take the role of chairman, while his longtime partner, Stephen Cassidy, will shift from president to managing partner.

“It has been my honor to lead Denholtz Properties through our evolution over the past four decades,” Denholtz said in a statement. “As we look to the future, we are confident that Katie’s extensive experience and leadership will guide us in building upon our legacy while seizing new opportunities for sustained growth.” 

Denholtz Properties, which also has a regional headquarters in Orlando, has a $2B portfolio that ranges from an under-construction apartment building in Charlotte to a 49-acre medical office campus in Chappaqua in Westchester County, New York. Its portfolio includes holdings in New Jersey, New York, Pennsylvania, Georgia, Texas, Florida and Tennessee. 

The firm’s outgoing CEO was given the NAIOP New Jersey lifetime achievement award this year. The portfolio he built up is starkly different than Kurtz’s last employer, where she was in charge of managing the finances of the World Trade Center complex among other billion-dollar projects. Before joining Silverstein, she had stints at AR Global and The Carlyle Group.

But Denholtz and Silverstein do overlap in some regards: They are multigenerational family businesses and have expanded their companies into new states and business lines, including setting up debt funds.

Denholtz launched a $100M rescue capital fund earlier this year, and Silverstein Capital Partners has raised $5B since its 2018 inception while positioning the firm to take over major projects such as the Brooklyn Tower and the $1B Avenue Bellevue near Seattle. 

“Over the past several years, Denholtz Properties’ strategic expansion into new markets has driven significant growth in its assets under management,” Kurtz said in an emailed statement. “The current market presents substantial opportunities to further expand the reach, size and diversity of our portfolio while strengthening our capital base.”

Israeli tech firm WalkMe Inc. is moving its U.S. headquarters to Kilroy Realty’s 350 Mission St. as it prepares to be acquired by software giant SAP, reported the San Francisco Business Journal. The digital adoption software provider, whose tools help guide users and employees through apps, signed on to sublease close to 18,000 square feet on the 26th floor of 350 Mission St. from Salesforce, sources told the Business Journal. WalkMe previously leased roughly 40,000 square feet at 71 Stevenson St.

The company’s lease at 71 Stevenson was set to expire in July. Although WalkMe is expected to take occupancy at 350 Mission this fall, it already lists 350 Mission as its headquarters on its website. It’s the latest to sublease Salesforce space at the 455,350-square-foot office property, which Salesforce once occupied in its entirety.

Cushman & Wakefield’s Sam Wasserstein, JD Lumpkin and Danny Pickard are listing Salesforce’s space at 350 Mission. JLL’s Mike Sample represented WalkMe in the deal.

GlossGenius, a financial technology company that powers the self-care industry through its spa and salon software, has leased 13,619 square feet of office space at 838 Broadway, a landmarked property owned by ZG Capital Partners. The company’s relocation from SoHo represents the first transaction in the building following ZG Capital’s recently completed full-building renovation.

Originally designed by Stephen Decatur Hatch in 1876, 838 Broadway was built on the site of President
Theodore Roosevelt’s great-great uncle James T. Roosevelt’s home. Ownership engaged architecture firm Spectorgroup to execute a gut renovation of the 80,000-square-foot boutique asset.

A JLL agency team led by Vice Chairman Mitchell Konsker, Executive Managing Directors Benjamin Bass
and Greg Wang and Associate Vice President Thomas Swartz represented ZG Capital Partners in the
transaction. Senior Vice President Joseph Sipala, Associate Vice President Hannah Bernstein and Associate
Stefanie Rock represented GlossGenius.

“ZG Capital’s vision to revitalize this historic property with a hospitality-infused design has combined the
building’s timeless elegance with design elements and modern finishes that create a superior office
environment for contemporary space users,” said Konsker

FUJIFILM Diosynth Biotechnologies will invest $1.2 billion to expand its biopharmaceutical manufacturing facility in Holly Springs, North Carolina, creating 680 new jobs in Wake County. Initial investments of the FUJIFILM’s Holly Springs operation included $2 billion in 2021. The company claims it’s the largest end-to-end biopharmaceutical manufacturing facility in North America. Holly

FUJIFILM Diosynth Biotechnologies’ expansion includes an additional large-scale monoclonal antibody Drug Substance manufacturing capacity that will support the company’s growing biologics CDMO business. The project will also include two additional drug substance manufacturing buildings, a shared headblock building with administrative space, as well as expansions of utilities, lab, and warehouse buildings currently under construction.

The average salary for new positions at FUJIFILM Diosynth Biotechnologies will be $109,923, which is nearly 50% higher than Wake County’s average wage of $74,866.

The Japanese contract drug manufacturer will receive $69.2 million in incentives from the state as well as Wake County and Holly Springs if it meets hiring and investment targets.

How does a fund seeking to buy $200M worth of single-family houses in the Southeast and turn them into rentals deploy that much capital? One unsolicited text at a time.

Investors are flooding the for-sale homebuyers market in Atlanta and the Southeast to turn them into rentals.

C-Star, a New York-based investment firm, is raising $50M in equity for a fund to buy single-family houses and convert them to rentals in Georgia, Florida and the Carolinas over this coming year, Michael Nemirovsky, the vice president of the investment fund, told Bisnow. With debt, the fund will look to spend $200M buying houses.

The single-family rental fund is C-Star’s third; its first launched in 2018 and spent $5.6M on 36 single-family homes in Metro Atlanta at a total cap rate of 7.5%, Nemirovsky said, and earlier this year, C-Star sold it to an SFR operator for $10.5M and an in-place 4.5% cap rate. Nemirovsky didn’t identify the buyer.

“We have seen multiple offers, five cash offers, for Fund I,” CEO Sherry Li said.

C-Star’s second fund expanded its geographic reach to include the Research Triangle and Charlotte areas of North Carolina and amassed $24M in investor funding. Li said the firm will hold this fund for two more years before marketing it for sale.

The third fund has already raised $10M, C-Star officials said, largely from high net worth investors and family offices. Spending it is another matter.

“It’s hard to deploy the capital,” Li said.

U.S. home prices are at all-time highs and mortgage rates are rising fast. To compete for deals, C-Star has an in-house team of 11 people who canvass the National Association of Realtors’ Multiple Listing Service, leverage relationships with management companies and, yes, send out text messages to homeowners, hoping to entice them to sell, Li said.

Li said the typical home purchase in the two earlier funds was between $150K and $250K. C-Star then did light renovation work, roughly $10K per house, before putting them on the rental market. But today’s marketplace necessitates C-Star getting a little more aggressive for the third fund.

Not only did it expand its geographic reach in the Southeast, the hub for SFR activity in the U.S., to include South Carolina and Florida, but it is now raising the amount of money it is willing to spend on houses: between $200K and $300K per house and spending up to $30K in renovations each, Li said.

C-Star is just one player in a crowded field of investors chasing SFR properties. A handful of neighborhoods originally planned for sale are now turning into rental campuses after being acquired by institutional investors. Other builders are constructing entire single-family neighborhoods with the intent of renting the units.

Brock Thomas, the founder and CEO of Swift Street Investments in Kansas City, Missouri, said he scours records for homeowners who are behind on mortgage payments to make purchase offers and then converts those homes into rentals.

“There’s just so much demand. And that’s not just from buyers, but from renters as well,” Thomas said. “Believe me, I look for reasons not to buy. Right now, I think there’s just this small window of opportunity in the market.”

C-Star is part of a universe of aggregators who buy single-family houses and turn them into rentals for a housing-hungry population, then amass a portfolio and ultimately sell it to larger institutional investors, who committed $45B to buy into the sector last year, PERE reported, citing data from John Burns Real Estate Consulting.

While the activity only accounts for a sliver of overall housing transactions, it is a fast-growing segment, with critics who say the investor rush been partially to blame for fast-rising housing prices that are elbowing many first-time or lower-income homebuyers out of the market.

According to Green Street Advisors, there are 16 million single-family rental homes in the U.S., which encompass 35% of all rental units, an amount that has increased 25% over the past decade. In the next five years, 810,000 households are expected to sign leases for single-family houses, according to Green Street, 1.5 times higher than the rate of those renting apartments.

“There’s a lot of pressure. There’s a lot of pent-up demand,” said Tom Johnston, the director of brokerage services for SVN SFRhub Advisors, which brokers portfolio sales in the SFR market. “There’s so much money in the space.”

C-Star will be facing enormous competition. The median home value in Georgia was just over $300K in March, according to Zillow, a more than 20% increase from 2020. The average sales price in the state jumped 17% to nearly $370K, according to the Georgia Association of Realtors. Georgia is the most popular state for SFR companies, which own 5.1% of all single-family rental properties, according to Green Street. Florida ranked second at 4.2%, followed by Arizona at 3.7%.

While scattered throughout Metro Atlanta in counties like Gwinnett, Fulton, Newton and Clayton, a number of C-Star’s homes are south of the city, where housing prices tend to be more moderate.

“We tend to be choosing [more] the entry homes than the medium or luxury homes,” Li said. “That’s what most renters are interested in.”

For groups like C-Star, increased competition from larger investors and institutions will become harder to overcome as interest rates continue to rise in the coming months, Johnston said.

“I think the smaller operators who have to use leverage to buy portfolios are at a disadvantage to the big funds. As we see interest rates creep, we’re going to see the smaller operators are going to have to look harder for the good deal,” he said. “It’s certainly going to favor the larger institutional operators who have cash and more funds. I think it gives them more leverage.”

Regardless, the demand for SFR is increasing, Johnston said. Last year, his firm sold 1,500 homes across the U.S. for just under $300M.

“We will probably hit that number or near that number by June,” he said, projecting that SFRhub could sell $500M in houses this year to SFR investors.

Thomas said the current housing environment is prompting many investors to be more aggressive in their buying strategies, especially with funds that have penalties if they don’t deploy capital within certain time frames.

Thomas said Swift Street only uses in-house capital from previous investments to buy new homes. His firm is now looking to buy traditional multifamily properties as well, in an effort to diversify its holdings.

“Most people used to find the deal before they raised the capital. Now the capital is getting raised before they find the deal,” Thomas said. “How does a homeowner compete? These houses aren’t coming back to the market. These houses are going to be traded like mortgages.”

Despite the competition, Li said C-Star is not experiencing any pressure to hurry up and buy assets from its investors. Instead, Li said she expects rising rates to chase more buyers away from the market, giving investors a larger pool of homes to choose from.

“I think over time, especially with the Federal Reserve rising interest rates, you will see fewer homebuyers on the market and they will become renters,” she said.

A CRE veteran who helped usher in popular adaptive reuse projects in Atlanta has teamed up to form a boutique brokerage firm with another seasoned real estate pro who led Stream Realty Partners’ retail group. 

Courtesy of Bridger Properties

Bridger Properties co-founders Jack Arnold and Merritt Lancaster

Merritt Lancaster and Jack Arnold have started Bridger Properties, a full-service brokerage firm that already is managing 500K SF and leasing 2M SF across Metro Atlanta, including the ground-floor retail spaces at Spectrum on Spring apartments and the retail leasing for the mixed-use Westside Paper project, which is currently under construction.

Lancaster and Arnold established the firm in late 2020 but officially announced its formation this month.

Lancaster — whose last firm, Confluence Real Estate, was folded into Bridger — said the timing of starting up a new brokerage house in Atlanta is partly due to real estate cycles: The coronavirus pandemic may be providing an opportunity to gear up as Metro Atlanta enters a recovery that will look hugely different from the last one.

“Even though it’s a very odd real estate cycle and it doesn’t jive with the other ones, it feels like the beginning of maybe a new cycle,” Lancaster said.

Since forming, Bridger has hired a handful of other CRE professionals, including property management Vice President Chris Hicks, previously a property manager for Stream Realty and Lincoln Property Co.; Laura King, who previously headed up leasing at Paces Properties; and Shelbi Bodner, who also worked at Paces Properties and assisted in leasing Krog Street Market’s food hall.

Arnold was previously the managing director of retail for Stream Realty in Atlanta, and he acknowledged that the firm at the moment is retail-heavy in its experience. But Arnold said Bridger is scouting the brokerage world for new hires to expand its expertise into other product types, including office.

“We plan to include having all the food groups as we go,” he said.

Arnold and Lancaster said Bridger is focusing on urban mixed-use and suburban properties throughout the metro area. Its initial leasing and management portfolio includes grocery-anchored and neighborhood shopping centers in Peachtree City, Acworth, Kennesaw, Smyrna and Sandy Springs, as well as retail at the Alexan Eight West apartments near Georgia Tech.

Bridger’s co-founders also have experience with adaptive reuse projects. At Stream Realty, Arnold drove the firm’s retail and mixed-use investment activity, spearheading the acquisition of 2.1M SF of retail, office and industrial spaces in the Southeast.

In the seven years he was a principal at Paces Properties, Lancaster and Paces CEO David Cochran developed a number of Atlanta’s most notable adaptive reuse projects, including Krog Street Market, Atlanta Dairies and Optimist Hall, a food hall in Charlotte that was converted from a historic textile mill.

Lancaster said Bridger also has opportunities to penetrate into the adaptive reuse and mixed-use sectors, which have been gaining more interest among institutional investors in recent years. Institutional owners have been tapping local experts with a track record in those properties to lease up empty spaces, Lancaster said. 

Transcend CEO Patrick Braswell, who co-founded his boutique brokerage firm in Atlanta in 2015, agreed that more institutional investors are looking to work with local experts, rather than relying solely on large, multinational firms.

“To understand where to find [deals] … and what tenants would be great for it, you have to have local knowledge,” Braswell said. “And sometimes the local boutiques have more local knowledge.”

Arnold said owners are seeking more nimble, less bureaucratic firms to lease their properties, and he and his co-founder think Bridger’s mix of services will hit the sweet spot for the increasingly large funds chasing real estate deals. 

“As capital consolidates and gets larger, they will continue to need local expertise on both the service and investment side,” Lancaster said. “We have the resources on both the landlord and tenant sides within the market. … That’s hard to get if you’re in New York. If you’re not touching it, it’s hard to get that local information.”

Bisnow/Ethan Rothstein

Alicia Glen, former New York deputy mayor for housing and economic development, at the 2016 REBNY gala.

The former New York deputy mayor for housing and economic development is taking on the real estate world beyond New York.

Alicia Glen, who is also a former managing director at Goldman Sachs, has launched the real estate development and investment firm MSquared, which aims to invest and develop housing for a variety of income levels.

After spending her over 20-year career in New York City, she plans to venture outside the bounds of the Big Apple, with her eyes set on midsized cities where economic growth has outpaced affordable housing, Glen said in an interview with Bisnow on Friday. 

“For right now, I feel the need to do work outside of New York,” she said. “Maybe it’s because I spent my whole life in New York, I am going to have to take a little road trip.” 

The company will work at the juncture of the private and public sectors in order to create mixed-use spaces that Glen believes will help kick-start economies and build up the middle class in these communities. While MSquared hasn’t identified a list of target markets, cities like Charlotte, Nashville and Austin fit the model it has identified.

“One of the things the pandemic has taught us is how interdependent we all are on the various sectors of the economy,” she said. “A city is not a city if you don’t have teachers, nurses, restaurateurs, and that doesn’t happen anymore without a deliberate intervention.” 

The projects that MSquared plans to invest in and develop will include market-rate housing, low-income affordable housing and housing for those that fall in between the two, the company said in its launch announcement.

Through investing and developing mixed-use space, the company will also meet a new need to live and work closely together without reliance on mass transit, a necessity that has arisen amid the pandemic, Glen said. 

MSquared is now part of the 14% of real estate companies led by women nationally. Carolee Fink, Glen’s former chief of staff, will also be a principal. 

“I’d be silly not to mention this is a feminist issue as well,” she said. “Who is making decisions? How do we look at cities? How do we look at investments?” 

Glen served as deputy mayor for five years under Mayor Bill de Blasio, helming the administration’s affordable housing initiative, as well as plans for Sunnyside Yards and Governor’s Island, before leaving the post in March 2019.

Last week, she critiqued her former boss’s decision to ax $2.3B of capital funds from the city’s budget amid the pandemic. 

“If we had a housing crisis before this, we’re going to continue to have an incredible housing crisis after this,” she told Bisnow. “It is just sort of saying, ‘We don’t care about you.’” 

Glen said her interest in markets other than New York is not based on how she feels about the city’s future but rather where the most dire need is for the type of housing stock the firm plans to produce.