Regions

Boston–Facing potential legal action from unhappy customers, State Street Corporation will create a $618 million reserve, The Boston Globe reported Thursday.State Street will take a $279 million charge to cover any subprime-related legal costs resulting from customers who feel its Global Advisors section may not have handled underperforming fixed-income investments as they wished.Some investment strategies were affected by subprime mortgage market exposure and liquidity issues and that it will “vigorously” defend itself against the claims, according to the Globe.Fiscal 2007 earnings per share will be between $3.42 and $3.45, based on a revenue increase of more than 30 percent from…

Cleveland–Following the lead of other regional banks, Cleveland-based National City announced Wednesday it would cut its dividend and fire employees in the wake of the mortgage market chaos,Forbes reports.In the third quarter, National City’s mortgage business–plagued by rising customer defaults–lost $152 million, reducing the company’s profits by 80 percent from 2006.As a result, National City has reduced its mortgage offerings. On Wednesday, the bank announced it would eliminate 900 employees from National City Mortgage.National City stock also has suffered from its subprime woes. Shares tumbled 56.5 percent in the past year, leaving an unusually high annual dividend yield of more…

By Keat Foong, Executive EditorSanta Ana. Calif.— Grubb & Ellis Co. predicts that transaction volume for commercial real estate will decline by as much as 25 basis points this year. The company says in a statement that “buyers should return to the investment market in greater numbers this year as all-cash and low-leverage buyers including institutions, REITs and foreign investors step up with purchases.” All the same, transaction volume is expected to fall short of the 2007 record, the company predicts.“Even in the absence of a recession, the U.S. economy is likely to expand at a sluggish pace,” says Robert…

By Matthew Marin, Associate EditorChicago–Finding its mark with design-savvy buyers looking for a sophisticated city residence with high-end finishes and spacious floor plans, Superior 110, a high-rise condominium development in Chicago, is about 50 percent sold with first deliveries available in fall 2008, announced the project’s locally based JFJ Development.Superior 110, a 27-story, glass-and-steel building, features 62 units, offering floor plans of one bedroom plus a den to three bedrooms plus a den, one-and-a-half to three-and-a-half baths, and 1,150 to 2,820 square feet of living space. Base prices start in the $500,000s, and parking is available for $40,000 to $48,000…

By Keat Foong, Executive EditorDedham, Mass.—Hebrew SeniorLife announced it has closed on the biggest tax-exempt bond issue in U.S. history for the development of a non-profit continuing care retirement community (CCRC). The $457 million in tax-exempt bonds will be used to fund the development of NewBridge on the Charles, a state-of-the-art CCRC located on the 162-acre Dr. Miriam and Sheldon G. Adelson Campus in Dedham, Mass. “This financing will help us bring to reality a unique new community and health care facility that will expand our ability to serve older adults in the Boston area,” says Len Fishman, president and…

Denver–Chateau Nicole, LLC has purchased an 80-unit apartment complex in Denver for $3.6 million, approximately $43,902 per unit.GRM Real Estate LLC sold the 56,361-square-foot Villas at Gage Pointe apartment complex. Jeff Johnson and Matt Ritter of Pinnacle Real Estate Advisors LLC represented the seller. Bobby Hutchinson and Joe Hornstein of Pinnacle Real Estate Advisors LLC negotiated on the buyer’s behalf.Built in 1973, the Villas at Gage Pointe consists of five studio apartments and 75 one-bedroom apartments located in seven three-story buildings. The units were renovated in the past two years to include new bathrooms and kitchens.

Laurel, N.J.–PHH Corp. announced Tuesday that asset manager Blackstone Group LP and a unit of General Electric Co. would not be acquiring the Mount Laurel, N.J., mortgage originator and fleet management service because Blackstone couldn’t raise the $1.7 billion required for the deal, The Wall Street Journal reports.Blackstone’s inability to finance the deal–considered small by most standards–could indicate that putting together large debt packages to finance buyouts in the future would prove difficult, the Journal says.Although the deal was signed in March, earlier this summer, J.P. Morgan and Lehman Brothers Holdings Inc., which also had agreed to fund the deal,…

Kuwait–The Kuwait Investment Authority hopes to find investment deals in the U.S. in the wake of the subprime mortgage collapse, The Financial Times reported Wednesday.The $213 billion sovereign wealth fund–which, unlike most Middle Eastern funds of its kind, is supervised by parliament instead of the ruling family–hopes to act quickly to benefit from crisis-related opportunities.The fund is said to be interested in financial service investments, according to the Times.”Perhaps we are at the eye of the storm now and are close to the peak of the problem,” Bader Al-Sa’ad, head of the KIA, told The Financial Times. “We don’t see…

Washington, D.C.–U.S. construction spending rose unexpectedly in November, but private homebuilding spending saw its biggest drop since 2002, according to Commerce Department data released Wednesday.Construction spending was up 0.1 percent; in October, it fell by an adjusted 0.4 percent, Bloomberg reports. School, power plant and factory construction offset continued weakness in homebuilding.Private residential building spending declined 2.5 percent–the 21st consecutive drop in home construction–following a 2.3 percent decline in October. Non-residential building was up 2.1 percent.While the increase in commercial spending showed signs economic growth may be stronger than many had feared, the drop in residential building indicated the housing…

By Matthew Marin, Associate EditorNashville, Tenn. –Designed by Cleveland-based ka architecture, Velocity in The Gulch, an environmentally friendly, condominium development, located in downtown Nashville in an area known as The Gulch, has broken ground. Bristol Development Group and Marketstreet Enterprises developed the project.“In designing Velocity, we worked with our clients’ vision to create a walkable environment designed with the young professional in mind,” says Robert Weeks, project manager at ka architecture. “In doing this, we developed efficient layouts and construction techniques making it an attainable option for those urban-minded professionals who enjoy the liveliness of the city.” Velocity, a five-story building,…