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All is not exactly lost for the real estate market, according to Cushman & Wakefield Sonnenblick Goldman. In a capital markets update on Wednesday, the firm reports that there is capital coming into real estate, with lenders and equity investors reporting greater desire and capacity to put money to work.

“Talk of a ‘liquidity bubble’ may be overdone, as capital providers are still very focused on strong sponsors and major markets, but liquidity is certainly having a strong impact on certain markets and assets,” the report reads.

Cushman also found that mezzanine lending spreads are starting to improve after nearly 24 months of subordinate debt quotes in the range of 16 to 22 percent, with several new funds coming into the market. The report also found that spreads have come in nearly 25 basis points during the past two weeks, with 10-year, Super-senior AAA bonds tightening to 430 basis points over the Treasury.

“The nearly continuous rally in AAA spreads over the past three months is being reflected in the enthusiasm of lenders for conduit loan product,” it reads. “Look for the first large multi-sponsor securitization involving assets other than multi-family in the next 6-8 weeks. Every major bank is either formally back in the market underwriting deals or is in the process of hiring loan origination professionals.”

Real estate investment firm Crocker Partners has been chosen to lease the 164,000 square-foot Mizner Park Office Tower and the 103,000 square-foot Mizner Park Office Plaza, both located at Mizner Park in downtown Boca Raton, Fla.

A mixed-use center, Mizner Park encompasses 45 shops and restaurants, 272 residences, and entertainment and cultural facilities such as the Mizner Park Cinema, the Boca Raton Museum of Art and the Centre for Arts Count de Hoernle Ampitheater within a single city block.

It has been cited as an example of smart growth by the U.S. Environmental Protection Agency. “The mixed-use Mizner Park town center demonstrates how suburban communities can create vital downtowns by redeveloping abandoned shopping centers,” the EPA’s report reads. “Redeveloping the underused Boca Raton Mall into a community center removed a blighted property and helped revitalize the surrounding community.”

Mizner Park was completed in several phases throughout the 1990s with the help of city and bond financing.

Crocker Partners managing partner Thomas Crocker, who was the original developer of Mizner Park, asserted in a statement that the Mizner Park Office tower is “downtown Boca Raton’s premier building.”

“That’s why Crocker Partners located its headquarters here since the building opened in 1999,” he continued, “and why we are pleased to now take on leasing.”

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After four years of litigation and a five-week trial, a jury has awarded Keystone-Texas Property Holding Corp. a more than $80 million judgment against Host Hotels and Resorts L.P., formerly known as Host Marriott, L.P., as well as its subsidiary HMC Hotel Properties II L.P.

The lawsuit was centered on the San Antonio Rivercenter Mall and the attached Rivercenter Marriott. Keystone, which owned both properties, entered negotiations in 2005 to sell them. Ten days before the Marriott hotel parcel closed, Host Marriott notified Keystone that it was in default under the parties’ lease agreement and first needed to separately negotiate with HMC for the sale of the property at a fair market value acceptable to both HMC and Host Marriott.

Host Marriott then sought an injection to bar Keystone from selling the property, alleging claims of breach of contract. This resulted in Keystone being unable to close the transaction, though the injunction was eventually denied. Keystone then filed counterclaims against Host Marriott and HMC, with the eventual trial centered on interpretation of the lease language highlighted in Host Marriott’s demand letter.

Keystone was awarded $34.3 million in compensatory damages for its tortious interference claim and $39 million for its claim on slander of title. It was also awarded $5 million in punitive damages against Host Marriott and $2.5 million in punitive damages against HMC.

“I believe the jury spent weeks evaluating the evidence and ultimately they arrived at the only possible conclusion,” J. Michael Ellis of Crouch & Ramey, LLP, who with Cole Ramey served as lead trial counsel for Keystone, told CPE. “I am satisfied with the jury’s verdict and appreciative of their diligence and hard work throughout the process.”

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More states than not saw unemployment rates increases between January and February 2010, according to the U.S. Bureau of Labor Statistics–30 in all, as well as the District of Columbia, while nine states saw decreases and 11 recorded no change. That’s the bad news.

The good news is that nonfarm payrolls actually increased in 31 states and DC, but decreased only in 18 states and was unchanged in one. The largest increases in raw employment numbers between January and February were in California (up 32,500), followed by Illinois (up 26,000), New York (up 25,500), Washington state (up 18,900), and Minnesota (up 15,600). The biggest losers for the month were Missouri and Ohio, which each lost 12,800 jobs each.

In terms of unemployment rates, Michigan still has the dubious distinction of suffering the highest one among the states of the union–14.3 percent in January. North Dakota, by contrast, has a positively pre-recession unemployment rate of 4.2 percent.

Survey Says: Tepid Growth Ahead

A Blue Chip Economic Indicators newsletter survey of 70 economists published on Wednesday is predicting annual growth for the U.S. economy of 2.9 percent in 2010. Lackluster, but a far cry better than the economic contraction of 2.4 percent in 2009. The economists also predicted 3 percent growth in 2011.

The dismal scientists also predicted that the core consumer price index for the nation–which assumes people don’t eat or drive cars, since it excludes volatile food and gas prices–would rise only 1.3 percent in 2010 and 1.6 percent in 2011. Thus the Fed might not have any impetus to make the cost of borrowing any higher for some time yet.

Regarding jobs, the Blue Chip survey said that “a slower and less powerful than is typical improvement in labor market conditions that will cap gains in disposable personal income and personal consumption expenditures.” In other words, a lot of people will still be down and out in the coming years.

The Case of the Foreclosed Parrot

In an instance of real estate oops in this age of foreclosure, a woman who lives near Pittsburgh is suing Bank of America for sending a contractor to her home last October to padlock the door and otherwise “secure” the property while she wasn’t there. The contractor was under the impression that Angela Iannelli’s house was being seized in a foreclosure action by Bank of America. But she wasn’t in default on her mortgage.

In her suit, filed Monday in the Allegheny County Court of Common Pleas, Iannelli alleges that the contractor had her utilities stopped, cut off the house’s water, damaged the floor, put antifreeze into the sinks and toilets, and took her pet parrot away. She was later reunited with her parrot, but only after a week of unhelpfulness on the part of Bank of America employees, she said.

The Bank of America has publicly said it “sincerely apologizes” for the incident, but Iannelli is asking for a little more than that, about $50,000. And maybe a big bag of birdseed for the parrot.

Wall Street eked out gains on Wednesday, with the Dow Jones Industrial Average up 2.95 points, or 0.03 percent, and the S&P 500 advancing 0.45 percent. Ten years to the day after its tech-bubble peak, the Nasdaq edged up 0.78 percent to 2358.95. On March 10, 2000, the index closed at 5048.62.

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Chicago-based Strategic Hotels & Resorts, Inc. has named Diane Morefield executive vice president and chief financial officer.

Morefield succeeds James Mead and will work out of the company’s corporate headquarters. She begins her new position on April 12.

“Diane has a strong combination of deep real estate industry knowledge and sophisticated financial and capital markets expertise,” Strategic president and chief executive officer Laurence Geller said in a statement. “Additionally, Diane has worked with many of our same key stakeholders on Wall Street both on the buy- and sell-side, as well as lenders and bankers, and we look forward to her proven discipline in managing our company’s financial assets.”

Morefield has more than 25 years of commercial real estate experience. She previously served as chief financial officer of real estate investment firm Equity International and earlier as chief financial officer of real estate development company Joseph Freed & Associates, LLC. Morefield received a Masters in Business Administration from the University of Chicago and a Bachelors of Science in Accountancy from the University of Illinois.

Last month, Strategic reported fourth-quarter net loss attributable to shareholders fell to $72.19 million from $285.08 million in 2008. Loss per share from continuing operations attributable to shareholders also dropped, going from $3.40 in 2008 to $1.23 a year later.

Strategic has a portfolio of high-end hotels and resorts in the U.S., Mexico and Europe, with ownership interests in 17 properties with an aggregate of 8,002 rooms.

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Private-equity firm Angelo, Gordon & Co. and Extell Development Co. have agreed to buy the Helmsley Carlton House in Manhattan for about $170 million, according to Tuesday’s Wall Street Journal. The Madison Avenue property is currently owned by the estate of the late Leona Helmsley, and sports some of the most expensive retail space anywhere.

Helmsley’s estate, which also holds the Park Lane Hotel, the New York Helmsley, a stake in the Empire State Building and other properties, had planned to sell off its assets earlier. But the Queen of Mean died right as credit started to dry up and the real estate bubble started to deflate in 2007, so the sales were put off.

On the buyers’ side of the deal, purchases were also put off. The Journal noted that Angelo Gordon raised a real estate war chest totaling about $2 billion between 2006 and ‘07, but managed to use only about a quarter of it until late last year.

So Long, Martin, So Long, Osa

Ahead of releasing its fourth fiscal quarter numbers, American Eagle Outfitters Inc. has pulled the plug on its Martin + Osa clothing store chain, as well as the online business under the same name. All together, the company will close 28 Martin + Osa locations by the end of its second fiscal quarter in July.

The recession knocked the stuffing out of the fledgling brand, launched only in 2006 and aiming toward a market older than the teen-to-young adults sought by American Eagle. In the company’s fiscal 2009, Martin + Osa sustained a $44 million loss, including a non-cash impairment of about $11 million.

“Closing Martin + Osa was a difficult decision, particularly in light of the progress that was made over the past year,” Jim O’Donnell, American Eagle CEO, said in a statement. “However, it is in the best interest of our company and stakeholders to focus our efforts on the brands that… have the highest potential.”

Liberty International to Break in Two

Liberty International, a British company that owns about £6.1 billion ($9.1 billion) in commercial real estate, is dividing itself into two new companies in the wake of declining property values and losses. The two new entities will be Capital Shopping Centres, a retail REIT with a market capitalization of £2 billion, and Capital & Counties, with a capitalization of about £1 billion, which will own property in the London districts of Covent Garden and Earls Court.

Liberty management said that the division would enable the successor companies to more closely focus on their specialties. Liberty lost £329 million in 2009, compared with £2.7 billion in 2008, and its properties lost 10.6 percent of their aggregate value last year.

Exactly a year after its recessionary low point on March 9, 2009, Wall Street managed a small gain on Tuesday.The Dow Jones Industrial Average was up 11.86 points, or 0.11 percent. The S&P 500 advanced 0.17 percent and the Nasdaq gained 0.36 percent. One year ago, the Dow stood at 6,547.05; at the end of the day Tuesday, it stood at 10,564.38, a 61.63 percent gain.

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Development firm Related Companies, L.P. has been approved by the Palm Beach County Board of County Commissioners to develop the 400-room Palm Beach County Convention Center Hilton hotel in West Palm Beach, Fla.

Known for developing the $600 million CityPlace retail and entertainment center in downtown West Palm Beach as well as the Time Warner Center at Columbus Circle in New York, Related has a more than $15 portfolio of residential, retail, office, trade-show and affordable properties. The firm beat out three competitors in the bidding process.

The process has been long and contentious, with some arguing that the area is already overbuilt and others rebutting that the convention center will not be able to compete with others without a major adjacent hotel. The hotel is expected to bring more than 360 full-time construction jobs over a two-year period as well as 300 permanent jobs upon full buildout, according to Palm Beach County assistant county administrator Shannon LaRocque-Baas.

“Related is thrilled to have been selected as the developer of the convention center hotel in Palm Beach County and to continue to realize the CityPlace master plan,” Related chairman and CEO Stephen Ross said in a statement. “There is no doubt that the hotel is a lynchpin to the success of the county’s very significant investment in the convention center and will be a powerful tourism attractor and key amenity.”

Related’s development team includes Hilton Worldwide, Coastal Construction and Catafulmo Construction, and architectural firm Nichols Brosch Wurst Wolfe & Associates, Inc.

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Holliday Fenoglio Fowler, L.P. has arranged $85 million in financing for the Lantana Media Campus in Santa Monica, Calif., which was sold for $200 million in last year’s largest office property deal in Los Angeles County.

The 462,429 square-foot Class A office campus is situated on 12 acres along West Olympic Boulevard in the Westside area and is home to several major entertainment firms including the IMAX Corporation, NBC Universal Television and Dick Clark Productions. In December, Maguire Properties sold the campus to the Lionstone Group and the Recording Academy. Maguire originally purchased the property in December 2004.

The property consists of the 203,102 square-foot Center Building, the 62,087 square-foot West Building, the 65,998 square-foot IMAX Building and the 131,242 square-foot South Building. Lionstone purchased the property as part of Lionstone Urban Investments Two, a $400 million fund that acquires real estate assets in high-amenity urban areas. It is the company’s sixth property along Santa Monica’s media and technology corridor.

“The Lantana Media Campus is positioned in the heart of the media and post-production entertainment world and has historically exhibited strong occupancy and cash flow,” HFF associate director Colby Mueck said in a statement. “The acquisition complements Lionstone’s portfolio in the submarket which now exceeds 650,000 square feet.”

Mueck, HFF managing director Mark Wintner and HFF executive managing director Scott Galloway represented Lionstone in securing the fixed-rate financing through Cornerstone Real Estate Advisers.

Lionstone was formed in 2001 and currently has more than $1 billion of discretionary equity being deployed.

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Vacant since its completion in late 2007, the 92,000-square-foot Ridgetop III office building in Sterling, Va., is empty no more. Developer and owner Bavar Properties Group has orchestrated a lease agreement with Neustar Inc. for the clearinghouse services provider to occupy Ridgetop III in its entirety.

Timing is everything. “Ridgetop III delivered as both the economy and the markets were slowing,” Bavar Vice President Robert Bavar told CPE. Located 25 miles northwest of Washington, D.C., Ridgetop III carries the address off 21575 Ridgetop Circle and sits within the Loudoun Tech Center. The 10-year lease facilitates an expansion for Neustar, which occupies 45,000 square feet of office space at Ridgetop I.

With the company’s agreement in place, Bavar’s three-building Ridgetop complex is now leased to maximum capacity. “The property is near Washington Dulles International Airport and next to the Dulles Town Center regional mall, so there is a huge amenities base there and amenities within the park,” Bavar noted.

Metropolitan Washington, D.C., has federal government offices to thank for buoying net absorption in the office market, according to a report by real estate services firm Grubb & Ellis, but a 100-percent occupancy rate is still no small achievement, particularly when federal government tenants are not involved. The area recorded an average direct vacancy rate of 13.6 percent in the fourth quarter.

However, a turnaround may be in the making. “In general, we’re seeing an increase in tenant activity,” Bavar said. “A lot of companies are realizing that the world is not coming to an end, and the economy is pulling out of the doldrums and starting to recover.”

Neustar will begin occupying its space at Ridgetop III sometime around the end of the year.