Daily market intelligence on mortgages, equity raising, investment sales, and CMBS.

Thursday, 21 February 2019

JLL Income Property Sees Making Up to $400Mln of Investments in 2019

JLL Income Property Trust Inc.'s exposure to the office sector shrunk to 13 percent of its total portfolio from 19 percent as a result of its recent sale of 111 Sutter St. in San Francisco. It plans to bring that exposure back up, but will likely target medical offices instead of conventional office properties. It also expects to continue buying apartment properties, particularly those in suburban markets with top schools.

Commercial Real Estate Direct Staff Report

JLL Income Property Trust Inc.'s exposure to the office sector shrunk to 13 percent of its total portfolio from 19 percent as a result of its recent sale of 111 Sutter St. in San Francisco.

It now considers itself to be underweight office, so it's looking to buy. It's especially keen on the medical-office sector and plans to continue increasing its allocation to the apartment market. It expects to invest between $300 million and $400 million in properties this year, capitalizing those investments with equity raised from the sale of its common shares to investors.

The company remains relatively active in raising capital, having raised $113 million of equity last year through the end of September, according to Summit Investment Research, making it among the top capital raisers in the non-traded REIT sector.

The company was formed in 2011 through the conversion by LaSalle Investment Management of its Exelsior LaSalle Property Fund Inc. commingled fund into a non-traded REIT. It's unlike most traditional non-traded REITs in that it was designed with a perpetual life, and it allows its investors limited liquidity. They can, for instance, cash out of their holdings, with certain restrictions, every quarter at the company's net asset value. Shares, meanwhile, also are sold at their NAV.

As such, Allan Swaringen, the company's president and chief executive, likens JLL Income Property to an open-ended fund that financial advisers can place their clients who want an exposure to low-leveraged real estate.

"We're the alpha of the underlying real estate, without the best or noise of the stock market," he said.

Since its founding, it has focused on stabilized properties in four major sectors: office, apartments, industrial and retail.

"We're a core, income-focused fund," Swaringen explained. The company tries to maintain allocations to...





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Data Digest

 

CMBS DELINQUENCY VOLUME

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CMBS SPECIAL SERVICING VOLUME

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Top Bookrunners Domestic, Private-Label CMBS - 2017
Investment Bank #Deals Vol$mln MktShr%
Goldman Sachs 17.59 11,819.34 13.68
JPMorgan Securities 14.52 10,968.11 12.70
Citigroup 12.04 10,012.71 11.59
Wells Fargo Securities 14.02 9,936.06 11.50
Deutsche Bank 12.55 9,879.74 11.44

 

RCA CPPI

 

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CMBS 2.0 Spreads

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Top CMBS Loan Contributors - 2017
Lender #Loans Vol$mln MktShr%
Goldman Sachs 146.89 11,719.34 13.63
JPMorgan Chase Bank 117.68 10,114.14 11.76
Deutsche Bank 198.48 9,689.97 11.27
Morgan Stanley 166.18 8,539.78 9.93
Citigroup 199.05 8,088.24 9.41

 

 

 

REITCafe

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  • US REITs Feeling Effects from Turmoil in Greece and China
    International economic forces have taken center stage this week, affecting both US stock markets and REITs. The crash in the Chinese stock market and ongoing concerns about the future of Greece in the eurozone drove markets down during the first half of the week. REITs fared better than the overall market...

  • What Does Increased Construction Mean for Apartment REITs?
    REITs so far this year have raised $17.1 billion of capital through the sale of unsecured notes, bringing the total raised over the past two and a half years to just more than $75 billion. That’s more than they raised during the previous five years. The massive volume shouldn’t be a surprise as it comes while the yield from 10-year Treasury bonds, the benchmark...
shouldn’t be a surprise as it comes while the yield from 10-year Treasury bonds, the benchmark against which most REIT’s price their bonds
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