Not too far away, in Redwood City, CA, the tech giant bought six properties within the 11-building Pacific Shores office park—originally developed by Jay Paul in 2001—from a joint venture of Blackstone and Starwood Capital Group, represented by Eastdil Secured. Google's first entry into Redwood City, the six-building portfolio traded for a reported $585 million, or about $625 per foot for 934,000 square feet. The new ownership reportedly will look at moving into current tenants' spaces as they become available over the next several years.

A two-state combination of leasing and build-to-suit development in which a 570,000-square-foot lease was the smallest component, Georgia-Pacific's 2014 expansion and consolidation was among the biggest deals the industrial sector has seen in some time. The building materials and consumer products firm worked with Hillwood on a 1.6-million-square-foot distribution center south of Dallas, and with Prologis for 1.5 million square feet of distribution space along the I-81 corridor in Pennsylvania's Cumberland County.

First up was the Atlanta-based company's agreement to lease the facility Hillwood planned to build at 1000 E. Cleveland Rd. in Hutchins, TX, east of I-45 and south of I-20. In 2013 the developer had gotten approvals, and an 85%, 10-year tax abatement, to build on 83 acres just north of where Panattoni Development Co. had begun work on a 1.4-million-square-foot facility for Procter & Gamble. The Hutchins BTS would represent a consolidation from G-P's distribution center in Mesquite, TX and elsewhere.

The Cumberland Area Economic Development Corp. lobbied for G-P to choose Prologis Park 81 in Shippensburg to build its second facility in Pennsylvania, joining an existing distribution center in the Bucks County community of Quakertown, near Philadelphia. Meanwhile, the Franklin County Area Economic Development Park wanted the company to select the United Business Park in Southampton Township, Franklin County. The Shippensburg site won out, with G-P committing to 1.5 million square feet at 234 Walnut Bottom Rd.

While that's under construction, G-P signed a short-term, 570,000-square-foot lease with KTR Capital Partners at 950 Centerville Rd. in Newville, PA, where it will remain until the Prologis build is completed. G-P's deals with Prologis and KTR represented 43% of the total square footage of new industrial leases signed in Central Pennsylvania during the third quarter, according to Cushman & Wakefield.

P&G'S SUPPLY CHAIN TRANSFORMATION

For UK-based discount fashion retailer Primark, the plan was to make its US debut with a superstore in Boston. By the time 2014 was done, however, it had lined up seven more locations, and as 2015 began it leased distribution space not far from one of them.

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The 112,000-square-foot lease Primark signed at the century-old Burnham Building, the only Boston structure designed by renowned Chicago architect Daniel Burnham, will bring retail back to what was purpose-built as the first Filene's department store. Millennium Partners began renovating the Burnham Building in 2013 as part of a $689-million redevelopment project that also includes the 625-foot Millennium Tower. Primark will occupy four floors of the eight-story Burnham Building, with 70,000 square feet of the space given over to retail; the store is scheduled to open at the end of this year.

The fact that Primark is an Irish company and Boston is known as a predominantly Irish town was not lost on the retailer, which also appreciated the significance of historical buildings from its expansion into major European cities. Along with a 37,000-square-foot lease to Roche Bros., Primark's commitment signified that “the retail leasing at Millennium Tower/Burnham Building has created a retail revolution in the city of Boston,” said Gene Spiegelman of Cushman & Wakefield last April. C&W represented the landlord and was the sole brokerage in the deal.

Six months later, Primark made another deal with a Chicago connection, this time entering lease agreements totaling 520,000 gross square feet with Sears Holdings Corp. for seven standalone stores in the Northeast and Mid-Atlantic, which Primark will occupy over the next 12 to 18 months. Sears will continue to have a significant retail presence at six of these locations, although at Simon Property Group's King of Prussia Mall in King of Prussia, PA, Primark will take over the space entirely.

Concurrently with this expansion, Primark in early January leased 677,088 square feet within Lehigh Valley Industrial Park VII, a joint venture between Trammell Crow Co. and Clarion Partners that's part of the overall redevelopment of the Bethlehem Steel Co. properties in Bethlehem, PA. The facility will serve as its primary East Coast distribution hub for Primark; CBRE's Joe McDermott represented Primark, while his colleagues Vincent Ranalli and Jake Terkanian represented the ownership.

KROGER DEAL STRIKES A SPARK

Shuttered in 2011 as part of the federal government's Base Realignment and Closure plan, Fort Gillem in Forest Park, GA is in the early stages of reinvention as a regional distribution and e-commerce logistics center. A joint venture of Weeks Robinson Properties and Starwood Capital Group was chosen as master developer for the 1,168-acre site, which ultimately will accommodate more than eight million square feet of industrial and mixed-use space.

What will be known as the Gillem Logistics Center is “one of those catalytic sites that can transform the region,” the Atlanta Regional Commission's Dan Reuter told the Atlanta Business Chronicle last June. The publication described grocery giant Kroger Co. as “the first spark for that transformation.” The Cincinnati-based retailer in June acquired 253 acres at the site after considering other Atlanta-area locations, and will occupy a 1.3-million-square-foot regional distribution center there.

Kroger will spend a reported $200 million on the facility, which is scheduled to open in the third quarter. Regarded as one of the largest industrial lease/build-to-suit transactions of 2014, and also one of the biggest industrial projects metro Atlanta has seen in recent years, the Kroger facility at Gillem Logistics Center takes advantage of intermodal transportation access along the city's Southside, one of the nation's busiest industrial corridors.

SALESFORCE TIMES TWO

Time Warner made real estate news all over Manhattan in 2014. Two of the year's biggest commercial property transactions resulted from Time Warner's re-evaluation of its real estate footprint in the New York metropolitan area, while a slightly smaller one was triggered by its decision to spin off Time Inc., its magazine unit. All three transactions entailed pulling up long-established stakes while remaining in Manhattan.

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In January, Time Warner simultaneously announced two long-rumored deals that focused on its office space at its namesake Time Warner Center near Central Park, where it had been headquartered since 2004. In one, it sold its 1.1 million square feet of owned office space to a venture of Related Cos., an entity owned by the Abu Dhabi Investment Authority and GIC Pte. Ltd., the sovereign wealth fund of Singapore. The venture will lease 943,438 square feet of office space back to Time Warner until early 2019. In the sale-leaseback, Time Warner was represented by Eastdil Secured and attorneys Stephen Lefkowitz and Harry Silvera of Fried Frank Harris Shriver & Jacobson.

A venture involving Related Cos. also figured in Time Warner's other real estate deal of 2014: its acquisition of more than one million square feet of office space at 30 Hudson Yards, which will house its corporate headquarters and approximately 5,000 employees beginning in 2018. Related, which had built Time Warner Center in partnership with AREA Property Partners, is developing the Hudson Yards mixed-use complex in partnership with Oxford Properties Group.

“We began a process two years ago to evaluate our commercial real estate footprint within the New York Metropolitan area, where we currently own and lease space in seven buildings,” said Jeffrey Bewkes, Time Warner's chairman and CEO. “By consolidating our space to Hudson Yards, New York's next great neighborhood, we will be able to reallocate substantial savings to our primary business of creating and sharing great storytelling in television, film and journalism with audiences around the world.” Savills Studley represented Time Warner and CBRE represented Related and Oxford in the Hudson Yards deal.

A desire for cost savings also motivated Time Inc. to decamp from the Rockefeller Group's Time & Life Building at 1271 Ave. of the Americas, where it had been headquartered since 1959. Soon after Time Warner announced that it intended to spin off Time Inc. as a separate company, Bloomberg reported that the magazine unit was looking at options in Lower Manhattan. A few weeks after Time Warner announced that the spinoff was official, GlobeSt.com reported that Time Inc. had signed up for six floors totaling 700,000 square feet at Brookfield Office Properties' Brookfield Place complex.

“We spent several months evaluating possible sites in Manhattan and New Jersey; our goal was to promote a sense of community in a cost-efficient home that will provide lifestyle and cultural amenities plus easy transportation access for our employees,” chairman and CEO Joe Ripp wrote in an internal memo obtained by GlobeSt.com. A Savills Studley team consisting of Mitchell Steir, Michael Colacino, Matthew Barlow and Howard Nottingham negotiated on behalf of Time Inc.; BPO's in-house team of Jerry Larkin, David Cheikin and Alex Liscio negotiated on behalf of the owner/developer.

MICHELIN PUTS RIDGEPORT ON THE MAP

Thirty football fields can hold an awful lot of tires. That's roughly the expanse that will be covered by Michelin North America's distribution center now under way at the RidgePort Logistics Center in Wilmington, IL. In May, the tire manufacturer signed a build-to-suit agreement with Ridge Development, the industrial arm of Transwestern Development Co., for 1.7 million square feet at RidgePort. The three-building BTS on 140 acres was the largest US industrial development to break ground in 2014. Michelin has the option to add another one million square feet on 41 acres.

When the Michelin deal was announced, John Greuling, president and CEO of the Will County Center for Economic Development, said it “substantiates RidgePort as a compelling player” in the county's logistics center. Further, he said, “This project confirms the county as one of the more significant logistics centers in the Midwest” for attractiveness and transportation options. Ridge Development president Jim Martell said the Michelin project was “just the beginning” for RidgePort, which would serve as the western terminus for the proposed Illiana Expressway that would connect I-55 and I-65 in northern Illinois and Indiana.

With room to build up to 14 million square feet of industrial, warehouse and logistics facilities, RidgePort is owned by an affiliate of Prudential Insurance Co. The Michelin facilities will be owned by a joint venture of Ridge Development and a Heitman Financial-advised state pension fund. A JLL team of Keith Stauber, Dominic Carbonari, Steve Ostrowski and Rich Thompson represented ownership, while CBRE's Stephen P. Navrarro, Trey Pennington and Traci Buckingham Payette represented Michelin.

For an illustration on the grand scale of the impact e-commerce is making on the industrial sector—and on brick-and-mortar retailers—look no further than Walmart's quartet of e-commerce distribution center leases in 2014. Totaling 4.8 million square feet, three of the build-to-suit deals were with the same developer, Majestic Realty.

The first of the four leases to be announced, though, was under the aegis of a different development team: a joint venture of Browning and Duke Realty. In June, the partnership announced that Walmart had selected it for a 1.2-million-square-foot BTS at AllPoints Midwest, an industrial campus the JV is developing in the Indianapolis suburb of Plainfield, IN. Thanks in part to the JV's foresight in constructing a speculative building pad the year prior, it was able to meet Walmart's requirement to have a DC completed by the end of 2014. Walmart was represented in lease negotiations by JLL's Brian Seitz and Kris Bjorson. In-house representation for the ownership came from Browning's Mark Susemichel and John Cohoat, and Duke's Mark Hosfeld and Kate Ems.

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Majestic's trio of Walmart deals began in early October, with a prelease of the entire 1.45-million-square-foot Building 1 at the developer's Majestic Chino Gateway project in the Inland Empire community of Chino, CA. The Walmart lease accounts for nearly half of what will be 3.1 million square feet of industrial space when Majestic Chino is fully built out. A September 2015 completion is expected for Building 1.

On Oct. 15, Pennsylvania state officials announced that Majestic would build Walmart a 1.2-million-square-foot e-commerce fulfillment center at Majestic Bethlehem Center in Bethlehem, PA. Brent Beabout, senior vice president of supply chain and logistics for Walmart Global eCommerce, said his company continues to expand its “next-generation fulfillment network with state-of-the-art e-commerce facilities like the one in Bethlehem.” The Bentonville, AR-based retailing giant had previously announced it would open a one-million-square-foot DC at Lehigh Valley Park Industrial Park VII, also in Bethlehem.

The day after Pennsylvania Gov. Tom Corbett announced his state's Walmart/Majestic Realty deal, Corbett's counterpart in Georgia, Gov. Nathan Deal, had similar news, although Atlanta's development community had known about it for weeks in advance. Deal's office said that Walmart would locate a 1.2-million-square-foot e-commerce DC at the Majestic Airport Center IV industrial park in Union City, GA. Walmart is slated to invest more than $108 million in the project over the next three years, according to Deal's office. In December, the Walmart BTS won NAIOP Georgia's Industrial Deal of the Year award. Located on the southwest side of the Atlanta area, Union City “is seeing a surge of jobs and investment through the resurgence of commercial real estate and exploding growth of e-commerce facilities,” Majestic Realty's Stan Conway, senior vice president and director of the development, said when the award was announced. “It's putting a great Georgia city on the map.”

A MF MEGA-COMPLEX TRADES BEFORE EXPANDING

Already San Francisco's largest apartment community at 3,221 units, the Parkmerced complex is slated to become far larger now that legal hurdles have been cleared to expand the 8,900 units over a period of decades. It will do so under new ownership: this past November, a group of New York City-based investors led by Mark Karasick bought the majority interest in Parkmerced from Fortress Investment Group and Rockpoint Group LLC in a deal arranged by Eastdil Secured that valued the complex at more than $1.35 billion. Fortress had acquired the controlling interest in a $735-million debt-for-equity swap in 2010.

The new ownership plans to spend $1.2 billion on improvements. To that end, it secured $450 million in first-mortgage financing from Ladder Capital, and a $400-million mezzanine loan from Children's Investment Fund.

BRIDGESTONE ROLLS ON IN NASHVILLE

Not all corporate relocations and consolidations involve moving out of the tenant's hometown. Although Bridgestone Americas Inc. CEO Gary Garfield said last November that “every city in the nation with direct flights to Japan was considered” after the company outgrew its existing 260,000-square-foot headquarters space in Nashville, the world's largest tire maker ultimately chose to maintain its North American offices in the Music City, while also consolidating operations from Illinois and Indiana.

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For Highwoods Properties Inc., that meant a plum build-to-suit assignment in the heart of Nashville's SoBro district. The Raleigh, NC-based developer will build a 30-story, 514,000-square-foot office tower for Bridgestone, which has pre-leased 100% of the property's 506,000 square feet of office. Highwoods expects to spend $200 million on construction, which got under way this past January. Designer for the tower will be Chicago-based Perkins + Will. “It's a big deal for Nashville to have powerhouse national architecture firms doing work here, as it shows developers feel the city is worthy of high-end buildings,” the Nashville Post observed when the deal was announced. “It sends a positive message—and one that will help maintain a hold on the nation's attention as Nashville continues its transformation from mid-sized regional player to a more major metropolitan city of note.”

The Bridgestone BTS, which is scheduled for completion in mid- to late 2017, also strengthens the REIT's presence in SoBro, where it already owns the Pinnacle at Symphony Place. That 520,000-square-foot tower, which Highwoods acquired in 2013 for $152.8 million from a joint venture of Barry Real Estate Cos., Canyon-Johnson Urban Fund and Integral Group LLC, is a block away from what will be the new Bridgestone headquarters.

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David Werner struck two big deals along 42nd Street in Midtown Manhattan last year. In a transaction for which negotiations began in the fall of 2013, a Werner-led group closed in June on its $1.5-billion acquisition of 5 Times Square, the 1.1-million-square-foot office tower that serves as

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the headquarters of Ernst & Young, from AVR Realty Co. AVR had paid $1.28 billion for the property at the corner of 42nd Street and Seventh Avenue in 2007.

East of 5 Times Square, Werner and fellow investor Mark Karasick emerged as the surprise lead bidders for the Mobil Building at 150 E. 42nd St. last April. The pair agreed to pay $900 million for the leasehold interest on the 1.8-million-square-foot property, aided by $700 million in first mortgage and mezzanine financing from Morgan Stanley.

Brokering both sales deals was the Eastdil Secured team of Doug Harmon and Adam Spies; Eastdil and Meridian Capital also put together the financing package for the Mobil Building. Werner's two 42nd Street buys ranked as the number one and number five single-asset sales of 2014, according to Real Capital Analytics.

TOYOTA TAKES TEXAS, AND VICE VERSA ROLLS ON IN NASHVILLE

One state's loss is another's gain. It's a familiar refrain in an era of corporate relocations, and one that seems especially common in association with Texas. As a case in point, Toyota last spring announced that it would consolidate three separate North American headquarters into one campus in the Lone Star State. The relocation involves the Japanese auto brand's current US headquarters in Torrance, CA, as well as Toyota Financial Services, also in Torrance; the main offices of Toyota Motor Engineering & Manufacturing North America in Erlanger, KY; and the operations base of Toyota Motor North America in New York City—all will be based in Plano, TX by 2017. A $40-million incentives package from the Texas Enterprise Fund helped Toyota reach a decision.

In July, Toyota selected Dallas-based KDC Real Estate Development & Investments to develop a $350-million campus on 100 acres within the Legacy West development in Plano, TX. It will house 4,000 Toyota employees and total about one million square feet. “KDC has a proven track record of delivering high value and innovative projects to a diverse group of clients on time and on budget,” Doug Beebe, corporate manager of Administrative Services at Toyota, said at the time. “They are also a recognized leader in providing environmentally sustainable solutions, an important qualification as we plan for an environmentally sustainable campus.” KDC is also developing an even larger campus for State Farm Insurance in nearby Richardson.

The effects of such a large-scale consolidation and relocation have implications beyond the office sector. “The immediate impact is that you will see more accelerated multifamily, retail and office development over the next one to three years to help accommodate the growth,” Mike Wyatt, executive vice president at Cushman & Wakefield, told GlobeSt.com in May. “Real estate values and office rates will continue to rise as the supply of readily available space diminishes.”

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BIG PHARMA, BIG SALE IN BOSTON

Boston saw its largest single-asset traxde to date in 2014, with Senior Housing Properties Trust paying $1.1 billion for the headquarters of Vertex Pharmaceuticals. The pharma firm, which relocated from the life-sciences hub of Cambridge, MA to Boston's Fan Pier, held a ribbon-cutting ceremony at its new facility a few days before SNH announced the acquisition in February from a joint venture of the Fallon Co. and Mass Mutual Life Insurance. HFF had begun marketing the two-building Vertex campus as the project neared completion, and SNH had its eye on the Fan Pier development. “We've been watching the growth of the Fan Pier and Innovation District,” SNH president David Hegarty told the Boston Globe. “That's the hottest market in Boston. It's also the hottest market in the country.” The sale, which also eclipsed the previous price per square foot for office space in the district, closed in May.

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WESTFIELD SEALS THE DEAL AT WTC

WESTFIELD SEALS THE DEAL AT WTC The biggest retail sale in 2014 occurred at one of the biggest development projects currently under way—the World Trade Center site in Lower Manhattan. The Westfield Group, which had been selected in 2011 to develop the retail component at the 16-acre site in a joint venture with the Port Authority of New York and New Jersey, acquired the remaining 50% stake in the retail complex for $800 million. At 365,000 square feet across multiple levels within the WTC site, the price per square foot equated to $4,384, a 30% premium on the value of the JV originally forged by Westfield and the Port Authority. The deal, which closed in March 2014, brings Westfield's total investment in the WTC complex to more than $1.4 billion. As part of the agreement, the Port Authority will share in a portion of future retail revenues should the project exceed certain return thresholds within the first five years.

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Tax-exempt Liberty Bonds figured in the refinancing of one Lower Manhattan skyscraper and in a deal that will allow another to eventually reach skyscraper status. Forest City Ratner Cos. sought to refinance the credit enhancement on the tax-exempt and taxable bonds issued by the New York City Housing Development Corp. for the $550-million construction loan on FCRC's New York by Gehry rental apartment tower at 8 Spruce St.

Chris Clayton, an executive vice president with the developer, came up with a creative solution: reissue the bonds without a third-party credit enhancement but instead rely solely on the credit of the underlying real estate. HDC agreed to the CMBS structure, something it had never done before, and in exchange the municipal agency will earn ongoing servicing fees that will benefit its affordable housing program.

For the $1.65-billion financing that will allow Silverstein Properties Inc. to proceed with construction of 3 World Trade Center, a similarly innovative approach was taken. The deal was structured as a hybrid of municipal bond and CMBS-style issuance, with the Port Authority of New York and New Jersey, New York City and New York State entering a unique public-sector financial support arrangement. The financing, arranged by a Skadden legal team led by Marco Caffuzzi, constituted the largest-ever unrated issuance in the municipal market.

2014 FINANCING AT A 2008 LOAN TO COST

When JDM Partners committed to buying a 14-property portfolio of offices net leased by a Fortune 50 insurance company—identified in Real Capital Analytics data as State Farm—it sought $505 million in acquisition financing, representing 92% of the capital stack on the $550-million deal to buy the properties from Lone Star Funds. The Phoenix-based investment manager tapped a JLL team led by managing director Dustin Stolly to source financing. Stolly secured quotes from a number of lenders, ultimately engaging UBS to commit to a single execution of $385 million in senior loan proceeds and $120 million in bridge equity. The loans were fully securitized via multiple conduits, with full-term interest-only financing for 10 years. The 92% loan-to-cost ratio hadn't been seen in the financing arena for nearly six years.

NEW PARTER, NEW NAME FOR ATLANTIC YARDS

Chinese institutional players have begun moving from strictly acquiring top-tier assets in gateway markets to developing them. This past June 30, Forest City Ratner Cos. and Shanghai-based Greenland Holdings closed on a joint venture for FCRC's long-delayed Atlantic Yards mixed-use development in Downtown Brooklyn. FCRC had tapped CBRE in the summer of 2013 to secure $1 billion at below-market returns by finding a partner that would take a majority interest in the 22-acre project.

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A CBRE team including Darcy Stacom, Bill Shanahan, Paul Leibowitz and Marcella Fasulo identified Greenland and overcame barriers of language, culture and time zones to complete an agreement by the December 2013 deadline. The agreement that FCRC and Greenland signed that month called for the Chinese firm to take a 70% stake in the development, not including the already-completed Barclays Center arena and under-construction B2 residential tower. Following the final closing of the deal in June 2014, the project was rebranded as Pacific Park, after one of the streets bordering the Long Island Rail Road yards beneath the development.

COLONY FINANCIAL'S INDUSTRIAL-SIZED DEAL

The North American deal of the year, as far as GE Capital Real Estate was concerned, was the $1.1-billion financing it provided to Colony Financial for the acquisition of the Cobalt Capital Partners industrial portfolio, which closed in December. The lender, which has arranged other loans for Colony over the past 20 years, ranks the Colony/Cobalt financing among its two biggest deals globally in 2014.

Colony, which paid a total of $1.4 billion for the 256-asset portfolio spanning some 30 million square feet, hired Eastdil Secured to line up acquisition financing. Conducting due diligence on all 256 properties within a tight 45-day timeframe posed a challenge, but the GE Capital team, led by global president and CEO Alec Burger, got it done on time. “We're happy to continue to be a part of Colony Financial's growing business and specifically their entry into the industrial sector with the Cobalt platform,” says Brad Trotter, North America president at GE Capital Real Estate.

When the Cobalt acquisition was announced in November, Thomas Barrack, Colony Financial's executive chairman, said that his company had “consistently signaled” that it could achieve additional growth and diversification via the launch of “focused platforms that will grow foundational returns and pursue expansion through bolt-on acquisitions. A market-leading presence in the light industrial space is one important manifestation of this strategy.”

Comprised mainly of light industrial, the portfolio spans 16 markets across the US, with an emphasis on the Atlanta, Chicago and Dallas metro areas, and represents the Los Angeles-based REIT's first foray into a full-scale industrial platform.

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For REITs, 2014 was the year of mergers and acquisitions. Alternately, for M&A activity 2014 was the year of the REIT. No fewer than nine such deals involving real estate trusts crossed the finish line last year, with all but one valued at greater than $1 billion. A tenth large M&A deal involved an operator for which activist investors have advocated a REIT conversion since at least 2012.

Not surprisingly, two of these transactions involved entities of AR Capital. Just after 2014 began, American Realty Capital Properties closed on its $3-billion acquisition of American Realty Capital Trust IV, a non-traded REIT affiliate. At the time, ARCP said the deal created the leading net lease REIT, with an enterprise value of $10 billion and a portfolio of 2,560 properties.

Those numbers paled by comparison, though, to the net lease behemoth that resulted from ARCP's next M&A deal. Its $11.2-billion acquisition of Cole Real Estate Investments Inc., first announced in 2013, was finalized last February. It put ARCP among the top 15 REITs in the MSCI Index and also made it the largest publicly traded net lease real estate trust, with an enterprise value of $21.5 billion and a portfolio nearly half again as large.

The two ARCP transactions were not the only major deals to occur in the net lease sector during 2014. A few days before the ARCP/Cole merger was finalized, W. P. Carey completed the acquisition of a publicly held, non-traded REIT affiliate, Corporate Property Associates 16 – Global Inc. Valued at $4 billion, the CPA: 16 deal gave WPC an equity market capitalization of $5.9 billion and a total market cap of about $9.6 billion.

Although another M&A transaction involving an AR Capital entity—Ventas' $2.6-billion acquisition of American Realty Capital Healthcare Trust—wasn't finalized until January of this year, the healthcare sector saw its share of mega-deals along these lines in 2014. Two related transactions involved entities of NorthStar Realty Finance Corp., although one was in eight figures rather than 10 or 11.

The larger of the two deals was NRF's $4-billion cash-and-stock purchase of Griffin-American Healthcare REIT II, an acquisition that stepped up NRF's game in the healthcare real estate arena. For Griffin-American II, the sale culminated an exit strategy the company had in mind when it bought its first asset in 2010. “We executed our strategy in a disciplined manner, building a premium international portfolio of diversified healthcare assets and delivering an attractive total return to our investors,” said Jeff Hanson, former chairman and CEO of Griffin-American II, when the deal closed in December. In a related deal, NorthStar Asset Management paid $57.7 million last November for a 47% stake in American Healthcare Investors, assuring that AHI would continue managing the Griffin-American II portfolio after the sale to NRF closed, along with most of the rest of NRF's healthcare assets.

The NRF/Griffin-American II merger involved assets across all four clinical asset classes: medical office buildings, senior housing, skilled nursing facilities and hospitals. A more narrowly focused union was that of Brookdale Senior Living Inc. and Emeritus Corp., which closed in July. A transaction valued at $2.8 billion, including the assumption of mortgage debt, the deal created what Brookdale—which has yet to convert to a REIT—called “the only nationwide network of senior living communities” covering the full spectrum of care. It operates approximately 1,150 communities across 46 states.

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