This is a company blog used by the New Jersey Jones Lang LaSalle Team to keep track of current events within the real estate sector. All items posted on this website are originally written by other authors from various sources. This is simply used as a searchable tracking system for news we found relevant to our business.
J.H. Cohn, Mintz Rosenfeld to Merge NJBIZ Staff, Martin C. Daks 6/14/2006
J.H. Cohn today announced it signed a letter of intent to merge with Fairfield-based Mintz Rosenfeld & Co. The two CPA firms, which will have a combined workforce of some 750 people, will operate under the Cohn monicker. The transaction is expected to close at the end of the month. When it does, Mintz will shutter its Fairfield and New York City offices. J.H. Cohn is based in Roseland.
posted by Jones Lang LaSalle NJ News Blog at 10:31 AM
Work Starts for 1M-SF Industrial Complex By Eric Peterson
PERTH AMBOY, NJ-Work is just under way on a 615,000-sf industrial building, the first of two buildings making up the Morris Cos.’ Amboy Corporate Center here. The Rutherford, NJ-based Morris Cos., specialists in big-box industrial, is doing the first building on a speculative basis. Morris has also hired Newmark Knight Frank to find users for the new asset. For NKF, principals William J. Cariste, Daniel Frankel and Doug Bansbach of the firm’s New Jersey office are handling the assignment.
"It is one of the first in a generation of major industrial projects on large redevelopment sites north of Exit 11 of the New Jersey Turnpike," says Cariste, who’s in NKF’s Woodbridge, NJ office. He notes that the project should also benefit from growth in overseas import activity, predicted when expansion of port facilities and dredging in Newark and Elizabeth are completed. "Our port facilities in Newark and Elizabeth handle some of the country’s largest volumes, but less than 55% of building inventory north of Exit 11 consists of truly modern distribution buildings."
The project is also part of the state’s portfields initiative, a joint effort by the New Jersey EDA and the Port Authority of NY/NJ aimed at identifying development redevelopment sites near the state’s ports. As reported by GlobeSt.com, the program identified 17 sites in five counties, with the Morris Cos.’ project’s site among those 17. Among other things, the program is aimed at making those identified sites, mostly brownfields and otherwise underutilized, "shovel ready," through a streamlined regulatory process.
Morris bought the 70-acre site in mid-2005 from Chevron, which had operated an asphalt refinery there. The sale price of the site was not disclosed, and after the deal closed Morris announced general plans for a 600,000-sf building with an estimated price tag of $72 million, targeting high-tech, distribution and light manufacturing users. Cost of the full build-out has not been released, but is believed to be in the $130-million range. Morris officials say they expect the second building, which would total 517,000 sf, to be under construction within the next 12 months.
The City of Perth Amboy had a hand in putting the deal together, agreeing in 2005 to give Morris a piece of property attached to the site in exchange for Chevron agreeing to donate an acre of land to the city for a new firehouse. The city has also expanded its urban enterprise zone designation to Morris’ site, which is adjacent to Chevron’s redeveloped 26-acre West Yard tract.
Builder let go in Devils arena flap Team's owner cites a breakdown in contract talks on final price for Newark project Thursday, June 15, 2006 BY GEORGE E. JORDAN AND MATTHEW FUTTERMAN Star-Ledger Staff
The Devils have dismissed the management company supervising construction of its arena in downtown Newark, the team's owner and city officials said last night.
The Devils parted ways 11 days ago with BovisHunt, a leading builder of professional sports venues, after they failed to negotiate a final price tag for the 18,000-seat arena.
"We did not agree with the monetary issues," said Devils owner Jeff Vanderbeek, who insists work on the arena's steel frame continues ahead of schedule to open in time for the 2007 hockey season next October.
New Jersey's oldest construction company, Wm. Blanchard Co., is temporarily running the site, and a new a construction supervisor should be hired next month, Vanderbeek said. "What's important is we're working to keep this project on schedule," he said.
The departure of BovisHunt highlights long-running concerns about the final cost of the arena, projected to run $310 million. It also represents the first major construction flap to spill into public since Newark handed the Devils control of the project in December 2004.
"There is something really not right about this," said Rod Taylor, managing director of Breitstone & Co., a major Long Island construction adviser with work in New Jersey. He said contract negotiations with BovisHunt should have been completed before the arena's steel frame began rising in late winter.
"It can happen, but most of the time it would have happened before they were on the job site," Taylor said of the breakdown in the final contract negotiations. "You would have to think it would have been worked out."
BovisHunt, which built Busch Stadium in St. Louis and the Arizona Cardinals' new football stadium, was selected two years ago from a field of five companies that submitted bids to Newark to oversee construction.
A spokesman for BovisHunt could not be reached last night. The company is an alliance formed two years ago between construction giants Hunt Construction Group and Bovis Lend Lease.
Under an agreement between the city and hockey team, taxpayers will provide $210 million of the construction costs and the franchise will pay the rest. In exchange, the Devils get to keep most of the ticket and concession revenue.
Mayor-elect Cory Booker has said he fears the final cost of the arena could run much higher, and suggested he may try to pull the plug on the project.
"What does it mean? It means this is a poorly conceived project, an unnecessarily rushed project," Booker said last night. "A project that is not the best use of land and city resources." Vanderbeek, a former Wall Street executive, declined comment on Booker's threat.
Richard Monteihl, Newark's business administrator and executive director of the nonprofit group overseeing redevelopment around the arena, said the city has spent at least $80 million on the arena so far, and the balance of the $210 million in public funding is committed.
"The arena is under contract, and based on those contracts people have invested huge amounts of money. It would be inadvisable to damage the project," he said. "It would leave the city with substantial legal exposure because everyone entered into these contracts in good faith."
BovisHunt was hired under a short-term contract as "temporary" construction manager to get the project underway, while final price negotiations continued, Vanderbeek said.
"It's not like we're switching construction managers mid-stream," Vanderbeek said.
The Devils are looking for a "guaranteed-maximum price" contract, an all-inclusive construction deal popular with the sponsors of public and private developments to hold the line on cost overruns. The final price is based on underground soil analysis, design features and engineering schematics.
Manhattan lawyer Barry LePatner, a corporate construction adviser, said many construction managers would likely bid to complete the arena, a trophy project, and replacing BovisHunt would not cause construction delays.
"It is certain ownership will find a replacement to get up to speed and proceed with its schedule for completion of the project," he said.
George E. Jordan and Matthew Futterman may be reached at (973) 392-4141. Jeffery C. Mays and Ian Shearn contributed to this report.
All eyes are on Newark's new apartments Thursday, June 15, 2006
BY JEFFERY C. MAYS The Lefcourt Building has long been a prominent fixture of Newark's skyline, but after falling on hard times, it lay vacant for 20 years.
More than 300 ironworkers, carpenters, laborers and electricians just completed a renovation, transforming the 35-story office building into 317 market-rate apartments. The $110 million makeover marks the first unsubsidized rental units downtown since the Colonnade Apartments were built in 1960.
Arthur Stern, chief executive of Cogswell Realty, the project's developer, said both his company and the city have much riding on the restoration of 1180 Raymond Blvd.
"This is the building that will be a catalyst for everyone else," Stern, wearing a white construction hat, said during a recent tour of the project. "It was an eyesore on the Newark skyline. This time next year, 500 people will be living downtown. This is what Newark needs." For all the talk about Newark being the next Jersey City or Hobo ken, there still aren't enough people living downtown. In a city of 280,000, there are only 619 households -- slightly more than 1,700 people -- in the census tract that contains 1180 Raymond Blvd.
Despite the success of the New Jersey Performing Arts Center and the development of an arena for the Devils hockey team, residential projects have been slow to develop in downtown Newark. NJPAC re cently announced plans for a residential tower, but most of the construction over the past few years has been two- and three-family homes built on vacant lots.
Newark was second in the state last year with 2,064 residential building permits issued, compared with Jersey City's 3,194, but only 168 of Newark's permits were for structures with five or more units, according to city records. Jersey City, meanwhile, issued 2,329 permits for buildings with five or more units. The value of Newark's permits for five or more units was $3.9 million, while the value of Jersey City's permits in that category was $209 million.
BOOM OR BUST
Still, commercial real estate ex perts say if 1180 Raymond Blvd. succeeds, it could jump-start a downtown residential building boom in the state's largest city. Conversely, if the 317 apartments don't fill fairly quickly, residential developers could be scared away for years to come.
"Developers look at other projects, and so do banks and investors," said Carl Dranoff of Dranoff Properties, which has completed major housing development projects in Philadelphia and along the Camden waterfront. "A success (with 1180 Raymond Blvd.) cer tainly would be a great benchmark for future projects. A sluggish project could discourage future investment and would have a pretty immediate impact on financial institutions."
A couple of downtown market- rate residential projects are already on the drawing board, including a controversial Mulberry Street project that would see 2,000 condominiums rise near the federal courthouse over the next several years. A few blocks away from 1180 Ray mond Blvd. are two other Cogswell restoration projects, the Hahne & Co. Building and the Griffith Building.
With ongoing concerns about suburban sprawl and growing interest from city officials in expanding Newark's population, the tim ing might be right for a boom in rental housing downtown, said Stephanie Bush-Baskette, director of the Joseph C. Cornwall Center for Metropolitan Studies at Rutgers University-Newark.
"For the last several years, it's been about people living in the city and wanting a nice place to live and the convenience of mass transit," she said. City dwellers "want to walk to cultural events. Many people who work in Newark can afford it. This may be an option instead of getting on the train."
The Lefcourt Building, also known as the Raymond Commerce Building, was designed by prolific Newark architect Frank Grad and completed in 1929. A New York developer named Abraham Lefcourt intended to use the building, but went bankrupt in the stock market crash of 1929, according to historic preservation consultant Ulana Za kalak.
The tan Art Deco building is an important part of Newark's Four Corners historic district and is noted for its "distinctive and ex traordinary ornamental work," including terra cotta panels and metal ornamentation along the five-story base, said Glen Leiner, executive director of the Art Deco Society of New York.
Cogswell Realty acquired the building in 1999 from the Helmsley Group. Stern at first sought to re make the building into student housing, but those plans failed. Cogswell then spent a year on redesign plans and the next four trying to finance the project. The city of Newark was the only major entity that lent support, providing some financial commitments.
"The typical response from lenders was, 'That's a great project. We wish you the best of luck. Call us on the second one,'" Stern said.
ITS OWN MONEY
While waiting for financing, Cogswell used $18 million of its own capital to start construction. "Our feeling was if we don't start this thing, no one will believe it was happening," Stern said. The gamble paid off. Cogswell eventually secured seven different sources of financing, including the use of historic tax credits and funding from the Prudential Foundation and Amelior Foundation. The Newark City Council also approved the city's first-ever incremental tax package, which provided a longer tax-abatement period and allowed the city to serve as a conduit for bonds to aid the project.
"It was a labor of love," Stern said of the quest for financing and the restoration of the building. The historic character of the building has been maintained down to refurbishing the marble and molding in the lobby. The apartments, however, are filled with modern amenities such as granite countertops, hardwood floors and a washer and dryer in each unit. Some apartments have ter races and views of the New York City skyline.
Other amenities include a doorman, available maid service and grocery shopping service. To deal with the lack of parking in the area, valet parking will be available. But the feature Stern is most proud of is a full-size, four-lane AMF bowling alley.
"Everyone who signs a lease gets a free pair of bowling shoes," Stern said. "The reason we put all these amenities here is to give people alternatives while the rest of the city fills out."
Anticipating some student tenants, the building is designed so apartments can be shared. But Stern is hoping to attract lawyers and workers from Prudential who now leave the city after dark. The apartments, including studios and one- and two-bedroom units, range from $1,395 to $2,215 per month.
Kevin Ledig, 29, a law school student, and his wife, Pamela Juárez, 25, a dental student, were the first tenants to sign a lease in January. About 60 others have signed leases since, Stern said. "You can still see the Empire State building and we love the fact that you are two blocks from Penn Station," Ledig said. "We want to be a part of what's happening in Newark, and this building has a lot to do with it."
Senate Pulls Back Xanadu-Related Bill By Eric Peterson
TRENTON-The State Senate’s transportation committee was expected to consider a bill (S-1790), on Monday that would funnel 60% of the sales taxes generated by the Meadowlands Xanadu shopping and entertainment complex in East Rutherford to Bergen County. The bill never made the agenda. According to a source with knowledge of the proceedings, S-1790 was pulled back "because of a lack of support." Future action on the bill is uncertain at this time.
Specifically, the estimated proceeds of $17 million a year would go to pay for road improvements along Route 3 from Lyndhurst to Secaucus, and Route 17 from Ridgewood to its intersection with Route 3. If passed, the legislation would set up a special account that would be administered by the New Jersey Meadowlands Commission, a state agency. Prime sponsors of the bill are senators Paul Sarlo (D-Bergen) and Joseph Coniglio (D-Bergen).
Outside of the State Senate, the proposed legislation has already drawn plenty of opposition. "The bill is constructed on the false premise that Xanadu, if it ever opens, will create new sales tax revenue," says Walter Smith EVP of the Secaucus-based Hartz Mountain Industries. Hartz officials have been constant critics of the Mills Corp. and Mack-Cali Realty Xanadu project. The firm has sued the developers over the project.
"There is no growth in buying power or discretionary income in New Jersey based on Xanadu," Smith says. "It just cannibalizes sales at existing malls and neighborhood retail stores. So this tax will then cannibalize a [state] budget that is already insufficient to maintain needed programs."
posted by Jones Lang LaSalle NJ News Blog at 10:28 AM
(AP) — Covance Inc., which tests drugs for potential commercial use, said Wednesday that it has extended a contract worth at least $187 million over the next seven years.
The Princeton, N.J.-based company said the contract is the largest in its history and secures toxicology space for an undisclosed client from 2007 to 2013. It will add about $150 million to its second-quarter backlog.
David Windley with Jefferies Research Department cited the new contract in a client note and reaffirmed a "buy" rating and a $64 target price on the stock.
Shares of Covance rose as much as 4.3% to $59.19 in morning trading.
"We continue to be impressed by Covance's ability to attract and secure dedicated agreements for toxicology capacity in a time when little capacity exists." wrote Mr. Windley.
He noted the new contract is "non-cancellable," meaning the client is committed to pay Covance $187 million whether the space is used or not.
Warnaco shares up on takeover speculation by David Jones
Shares of Warnaco Group Inc. rose sharply on Wednesday following a news report saying the intimate-apparel and swimwear maker could be an acquisition target of retailer Phillips-Van Heusen Corp.
Women's Wear Daily, citing unnamed sources, said there have been talks about combining Warnaco, which owns the Calvin Klein business and the license for Calvin Klein jeans with Phillips-Van Heusen, which owns the rest of the Calvin Klein business.
Phillips-Van Heusen Chief Executive Emanuel Chirico reportedly said that there were two criteria for an acquisition: a very strong brand that has great consumer recognition or an extension of an existing product category such as a complimentary retail operation or additional licensing venues.
Shares of Warnaco rose as much as 10.3% to $19.29 and were up 6.4% in the afternoon, while Phillips shares were gained as much as 5.6% at $36.28.
Phillips-Van Heusen and Warnaco, officials each said they do not "comment on rumor and speculation."
Warnaco, the maker of Speedo, Nautica and other lines, acquired long-term Calvin Klein licenses in Europe and Asia for $284 million in cash in December to help boost its profits, which have declined more than 40% in the last two consecutive quarters.
Liberty Bonds approved for three WTC towers by Catherine Tymkiw
The Liberty Development Corp. gave preliminary approval for $1.67 billion in Liberty Bonds to help build three of the five towers at Ground Zero.
The City is expected to give preliminary approval for an additional $921 million in Liberty Bonds for the towers next month.
"We expect that this [approval] will not only help leaseholder Larry Silverstein finalize the balance of his financing, but will facilitate the expenditure of funds at the World Trade Center site and accelerate real progress of construction," said Empire State Development Corp. Chairman Charles Gargano in a statement.
The site’s owner, The Port Authority of New York and New Jersey, and Mr. Silverstein originally entered into a 99-year ground lease for the site in the summer of 2001, shortly before the destruction of the original World Trade Center. A revised ground lease is in the process of being negotiated.
The two sides butted heads earlier this year over who would have control over rebuilding efforts. Gov. George Pataki had made the release of the bonds contingent upon an agreement between the Port Authority and Mr. Silverstein.
They came to an agreement in April, with Mr. Silverstein giving up development of the Freedom Tower in exchange for these three towers. Port Authority agreed to occupy space in one of the towers and to secure leases for 1 million square feet at the Freedom Tower.
Rutgers University’s on-again, off-again plans to overhaul the College Avenue campus may be on again.
Bank of America is scheduled to present a "major grant" to the state university this morning to help fund a redesign of the heart of the New Brunswick campus, school officials said. Rutgers President Richard McCormick will accept a check at an 11:15 a.m. press conference in Winants Hall.
McCormick first suggested a campus makeover last year. Early plans included closing College Avenue to traffic and creating a mile-long pedestrian greenway from the Raritan River to the New Brunswick train station.
Last fall, Rutgers kicked off an international design competition. Five design firms were given $50,000 to come up with a new look for the 69-acre campus in downtown New Brunswick. The plans were to include a new academic building, new dorms and a new transportation hub.
But McCormick abruptly postponed the competition in April, just a few days before the five finalists were due to unveil their proposals at a campus ceremony. The president said it would be "inappropriate and insensitive" to go ahead with the redesign competition while Rutgers and the rest of the state’s colleges were facing nearly $169 million in proposed state budget cuts. "Right now, the university community and I are preoccupied with the budget," McCormick said at the time, promising to restart the competition in the fall.
The Bank of America donation will be the first large gift for the redesign project.
Once a winning design is chosen, the campus overhaul is expected to be broken up into three phases, each with a $100 million price tag. Rutgers expects to pay for the new construction, landscaping and other changes through a combination of state borrowing, state transportation funds and private donations.
posted by Jones Lang LaSalle NJ News Blog at 10:17 AM
Merck offers Bayer its stake in Schering Successful acquisition of Schering by Bayer now much more likely / Wenning: "All three companies concerned will benefit from this step" / Suit filed against Merck to be withdrawn
LEVERKUSEN, Germany, June 14, 2006 - Bayer AG is to acquire all the shares of Schering held by Merck. In the course of joint talks, Bayer and Merck have agreed on the need to end the uncertainty regarding the Berlin company’s future to avoid damaging. Merck has therefore decided to sell its 21.8 percent (according to SEC) stake to Bayer, clearing the way for Bayer’s acquisition of Schering. The purchase price is EUR 89 per share.
All other Schering stockholders who have tendered their shares under the public takeover offer, or who decide to do so before the acceptance period expires at midnight CEST on Wednesday, will benefit from this price, which is EUR 3 above the original offer.
"We’re very pleased about Merck’s decision, because a lengthy competitive bidding process would have greatly affected Schering’s future," said Bayer Management Board Chairman Werner Wenning. "All three companies concerned will benefit from this step. We are very optimistic that we can now secure at least the three-quarters of Schering’s capital stock that we were aiming for, enabling us to quickly begin the integration process. Today we have taken a major step toward creating a world-class German pharmaceutical company."
The future company "Bayer Schering Pharma" will strengthen Germany’s role as a pharmaceutical industry location. This is in the interests of the entire sector. Bayer and Merck therefore agreed during their talks to look into further possible opportunities for cooperation between the two companies. Bayer will withdraw the suit filed against Merck in New York on Tuesday.
posted by Jones Lang LaSalle NJ News Blog at 10:16 AM
Madison group to air Exxon site concerns Florham Pk. plan to add hotel, housing may hurt environment, leaders say BY NAVID IQBAL DAILY RECORD
MADISON -- Leaders of Madison Matters, a civic group, aren't too worried about the New York Jets' decision to move to neighboring Florham Park.
They are concerned, however, about the talk of an adjacent 500 units of housing, a hotel conference center and resulting traffic at the 400-plus-acre Exxon Mobil Corp. property, and they've called a meeting for tonight to get borough officials to keep an eye on such developments.
David Arthur of Madison Matters said the Jets' impact on the area in an environmental sense will most likely be "negligible," but added that "There are a lot more environmental issues than the Jets."
"It's hotel conference center, 500 age-restricted housing units. What are they going to do with the existing structures? How will people get in and out? Those are the sorts of things that we want to make sure Florham Park understands," Arthur said.
Tonight's meeting, at 7:45 at the Madison Community House, 5 Cook Ave., is open to the public, and expected to attract a sizable crowd. Madison Mayor Woody Kerkeslager, Councilwoman Astri Baillie and Councilman Donald Bowen are expected to attend.
Madison Matters was instrumental in mounting a challenge to Florham Park when it rezoned the Exxon site to allow 2 million square feet of office and hotel space in 2002. Madison, Chatham and Chatham Township sued Florham Park over traffic and environmental issues, especially in relation to a concrete paving which may have prevented rainfall from replenishing an aquifer.
A Superior Court decision in 2004 established conditions for redeveloping the Exxon site. Redevelopment would be governed by state standards for water management and would require Florham Park to conduct a regional traffic study, according to the settlement.
Arthur hopes the meeting will push Madison lawmakers to press for, among other things, a traffic study.
"We need to empower our representative to be on top of this," Arthur said. Florham Park Mayor Frank D. Tinari was not available for comment Tuesday.
posted by Jones Lang LaSalle NJ News Blog at 12:18 PM
Ricoh Begins Consolidation Martin C. Daks NJBIZ Staff 6/13/2006
Five years after Ricoh acquired Lanier, and three months after the West Caldwell company said there were no plans to consolidate brands, Ricoh announced it has started to consolidate the back-office operations of Ricoh U.S. and Lanier Worldwide "in anticipation of a future consolidation of those entities."
A company spokesman says, however, that the individual brands will be maintained, while the new business unit will continue to be known as Ricoh U.S. Current Lanier CEO Nori Goto was named CEO. and Tom Salierno, Ricoh U.S. president, was appointed chief operating officer of the new business unit. The company, a supplier of office-automation equipment and electronics, says Ricoh will continue to be headquartered in West Caldwell. The Ricoh U.S. business unit will maintain locations in West Caldwell and Atlanta.
posted by Jones Lang LaSalle NJ News Blog at 12:17 PM
June 14, 2006 -- THE New York Times Building at 620 Eighth Ave. is on a roll and close to landing another big name law firm to its roster.
Covington & Burling is reviewing a lease for about 160,000 feet on floors 39 through 43. Sources said the 20-year pact will include options for floors 44 and 45.
Studley Chairman Mitch Steir, with David Goldstein, is leading a gaggle of brokers representing Covington & Burling, which would relocate from 1330 Sixth Ave.
A CB Richard Ellis team lead by Tri-State CEO Mary Ann Tighe and Howard Fiddle are representing developer Forest City Ratner.
None of the players would comment on the deal.
Last week, Forest City said it would buy out its partner, ING, for the 700,000 feet above the Times headquarters.
Forest City will then control floors 29 through 52 and the 24,000 feet of ground floor retail. The law firm Seyfarth Shaw has already grabbed 100,000 feet on floors 31, 32 and 33 for the next 17 years.
posted by Jones Lang LaSalle NJ News Blog at 12:16 PM
Will Merger of Buchanan Ingersoll and Klett Rooney Trigger Other Firm Mergers? By Gina Passarella The Legal Intelligencer 06-14-2006
Buchanan Ingersoll and Klett Rooney Lieber & Schorling have become one after a shareholder vote at both firms Tuesday morning gave the merger the go-ahead.
The new firm, Buchanan Ingersoll & Rooney, will become the largest law firm in Pennsylvania -- in terms of number of attorneys in the state -- with roughly 313 lawyers according to the last survey conducted by PaLaw. As a whole, the firm will have more than 525 attorneys nationwide.
Leaders of the new firm anticipate that it will be in the top 80 of national firms with an estimated combined gross revenue of $265 million.
The deal is effective July 1, and will give Klett Rooney president and managing shareholder John A. Barbour one of three executive shareholder roles at the new firm.
Buchanan Ingersoll chairman Thomas L. VanKirk was recently re-elected to another three-year term, which will last through 2009.
"This is the largest combination our firm has ever done, and it was an obvious match for us in terms of culture, practice area and the continued development of our strategic plan," VanKirk said in a statement. "Strengthening our mid-Atlantic presence better enables us to continue to pursue our goal of being a strong national firm operating as one unified entity."
VanKirk said in an interview that he is looking to build upon the strength of the combined firm in the Philadelphia market, possibly by bringing on groups in intellectual property or adding to other practice areas such as labor. The firm would still look to expand in either its core competencies or core geographic areas, he said, such as on the West Coast or in Miami or in the labor practice area.
Howard Scher, Buchanan Ingersoll's Philadelphia office managing partner, said the office already has a number of groups in the pipeline, and VanKirk told him to start building immediately. Four labor attorneys that were against the merger did leave Klett Rooney for Cozen O'Connor, Stephen A. Cozen confirmed Tuesday.
The group was said by some sources to be against the merger between Klett Rooney and Buchanan Ingersoll, and their departure dispelled most concerns that the shareholders would voice opposition to the combination of the two firms.
Buchanan Ingersoll and Klett Rooney had been talking for the past few months. Barbour said he and VanKirk have been friends for years, and the merger discussions started out of that friendship.
"I've known Tom VanKirk, Fran Muracca and Buchanan Ingersoll for many years, so it was easy to see how we could create a strong partnership out of our two firms," Barbour said in a statement. "The geography fit. Our clients fit. The practices fit. This was one of those rare decisions in life that almost makes itself."
In total, approximately 250 Klett Rooney attorneys, government affairs professionals and staff members will join Buchanan Ingersoll.
Scher said staff redundancies would not be an issue with this merger.
"We are right-sized in both offices," he said of the Philadelphia offices. "There will not be a reduction in staff."
VanKirk said that Klett Rooney ran a "lean ship" and had administrative strengths in areas were Buchanan Ingersoll had needs.
There had been some question about how the shareholders of Klett Rooney, which has one tier, would fit into the three-tiered shareholder structure of Buchanan Ingersoll.
Alfred J. D'Angelo Jr., one of the labor partners who was on board with the merger from the beginning, said that the transition went smoothly. He said about 90 to 95 percent of the shareholders realized where they should fit in, and only about six went back and forth in discussions.
Klett Rooney has a national client base and serves companies such as Chubb Insurance, UPMC Health Systems, The Pittsburgh Steelers, Reliant Energy and Verizon.
Klett Rooney bankruptcy shareholder William H. Schorling said the combined firm will have one of the largest creditors' rights and financial institutions practice in the mid-Atlantic region. He said there would not be a major lender in that region that is not represented by the combined firm in a "major" way.
Both sides said they were surprised at the lack of conflicts they faced. Scher said most of the clients he spoke with said they had already used Klett Rooney for other legal needs. He said the firms are "accomplishing convergence with clients."
VanKirk said there are a few conflicts that still need to be ironed out, but Barbour said there is more overlap than conflict.
The firm's new logo, "Buchanan Ingersoll & Rooney: Attorneys & Government Relations Professionals," shows the emphasis the combined firm is placing on its lobbying business. The firm said that it now has one of the largest government relations practices of any law firm in Pennsylvania with 35 attorneys and professionals.
The new firm will now have an energy law sub-specialty with the addition of Klett Rooney's John Quain who is the former chairman of the Pennsylvania Public Utility Commission. Daniel E. Beren, head of Buchanan Ingersoll's state government relations group in the Harrisburg office said the Klett Rooney government relations specialists have a strong Pennsylvania practice with a focus in Harrisburg and some in Pittsburgh. "It'll be one of those situations where one plus one will make four," Beren said of the combination.
Beren will take on more of an emeritus role while Klett Rooney's Thomas G. Paese will lead the firm's government relations group.
Michael Coleman of Coleman Legal Search said the merger is an opportunity for Buchanan to continue on the growth track it has been on after a "comeback year" last year.
Klett Rooney's labor and employment group was its "crown jewel," particularly in the Philadelphia area, Coleman said, adding that the firm also has a strong bankruptcy practice with Schorling and Teresa K.D. Currier.
"People knew the labor and employment group from the time they were at Pepper [Hamilton], but the firm didn't have a high level of identity in the [Philadelphia] community," Coleman said. Klett Rooney was at a difficult size with 130 attorneys and needed to do something, Coleman said, pointing out that this merger will increase awareness of the firm in Philadelphia.
The firm's labor and employment and bankruptcy groups are a complement to Buchanan Ingersoll's litigation and business groups in Philadelphia, Coleman said.
The merger changes the landscape of the Pittsburgh legal community, moving the firm in the top three in the city behind only Kirkpatrick & Lockhart Nicholson Graham and Reed Smith. The merger "will point more to the Pittsburgh legal community as being a force nationally," recruiter Maura McAnney of McAnney Esposito & Kraybill Associates in Pittsburgh said. "I think it's exciting for the Pittsburgh legal community to have a firm that was able to strengthen itself on a national basis."
The intra-city merger was one that hasn't been done in at least the last 20 years in Pittsburgh, but VanKirk said the merger fit into both firms' goals.
"We set out in 1986 to be the dominant firm in Pennsylvania," VanKirk said, adding that Buchanan Ingersoll became important but not necessarily dominant. "This [merger] gives us the opportunity to be dominant in Pennsylvania and the mid-Atlantic region."
With a strong financial basis in the region, VanKirk said the firm could achieve its national goals. Schorling pointed out that while both firms began in Pittsburgh, the majority of each firm's governing body is not in that city.
Barbour said the firm would also be dominant in Harrisburg with 34 lawyers. The firm will have 20 attorneys in Wilmington, Del., and more than 30 in New Jersey.
VanKirk said that he does not expect the merger to have the same effect on the firm's financial indicators as some of the double-digit increases it saw in 2005, but said that he thinks the revenue per lawyer (RPL) and profits per equity partner (PPP) numbers will increase. VanKirk said the effect of this merger probably would not be financially visible until 2007 to as late as 2009.
The two firms' PPP were "remarkably similar," VanKirk said. Barbour said that Klett Rooney shareholders would see an increase in both RPL and PPP.
"We wouldn't have done the deal had we not been confident of that," he said.
Buchanan Ingersoll's PPP for 2005 was $455,000 and its RPL was $505,000.
The discrepancy in the starting salary between the two firms, with Buchanan Ingersoll at $125,000 in Philadelphia and Klett Rooney at $115,000, was resolved in favor of Buchanan Ingersoll's number, the firm leaders said.
Schorling said he believes the merger might set off similar ones in the Philadelphia or Pennsylvania market.
"I think it will have a significant competitive impact," Schorling said. "It will make life more difficult for other firms."
Leaders of the new firm said they have a few things to iron out before the July 1 close date. The issue of space was left on the table until after the shareholder votes. Scher said, however, that his office has plenty of space to house the Klett Rooney attorneys in Philadelphia. VanKirk said that as the Philadelphia office grows, more space might be needed.
The leases for some of Klett Rooney's offices in the state will end soon, and further decisions can be made then, firm leaders said.
The issue of who will head various practice areas has not been fully decided on yet, but labor and employment attorney Anthony J. Messina will co-head the firm's Philadelphia office with Scher. It was rumored that Messina was on the fence about whether to stick with the combined firm post-merger, but D'Angelo said that was never the case.
posted by Jones Lang LaSalle NJ News Blog at 12:15 PM
Riker Danzig Opens London Office to Gain Edge in Insurance Business Charles Toutant New Jersey Law Journal 06-14-2006
A Morristown, N.J., firm is hopping the pond in hopes of improving its foothold in London's insurance and reinsurance industries.
Riker, Danzig, Scherer, Hyland & Perretti becomes the first major New Jersey firm to open in London, setting up shop in the city's financial district where the largest carriers have offices. The 158-lawyer firm has leased space for a half-dozen lawyers but at the outset will have only two: a British solicitor and a New Jersey associate. One or two more are expected by the summer's end.
Riker Danzig hopes to build on an existing base of insurance clients and to start a commercial litigation and banking practice in London as well, says firm co-chairman Shawn Kelly, who heads the 40-lawyer insurance practice.
He says the firm has 300 open cases for British insurance clients, with policy limits at issue totaling over $100 million.
The longtime client most responsible for the London opening is Castlewoods EU Ltd., which together with its subsidiaries makes up 80 percent of Riker Danzig's London insurance business. "They came to me six or seven months ago and said, if you come to London, we will keep you busy," Kelly says. With that commitment, Riker Danzig has decided that the venture -- contemplated for a few years -- is now worth the investment, he says.
Castlewoods acquires and manages financially distressed U.S. and British insurance companies that have stopped writing new policies, mostly because of excess liabilities for asbestos or other environmental problems, and ekes out a profit by managing claims.
The company is in the midst of a restructuring that will provide more capital and permit an ambitious expansion, Kelly says. On May 24, Castlewoods announced a merger with The Enstar Group of Montgomery, Ala., and will become part of a new Bermuda-based subsidiary, Enstar Group Ltd.
Riker Danzig also does work for RiverStone Insurance Co., Highlands Ins. Co. and Mutual Marine Office Ins. Co. and hopes to add others.
The resident partner in the London office is Castlewoods' former general counsel, Eleni Iacovides, a solicitor of the Supreme Court of England and Wales. Kelly says that when the London office was on the drawing board, Iacovides seemed like a natural fit and so he asked Castlewoods officials if he could approach her. They agreed. "I think they understood she wanted to work at a law firm again," he says. "They've been very supportive."
Although phones and computers were being connected Tuesday at the new office in London's banking district, located at 33 Cornhill, within walking distance of London Bridge, Iacovides has been on the job for several weeks, Kelly says.
Joining Iacovides as a resident associate is Helen Franzese of the Morristown main office. An Irish citizen, Franzese expects to become a British solicitor by the end of the summer. Kelly and fellow partners Gerald Liloia and Brian O'Donnell will work on London matters from Morristown.
Kelly's confidence about Castlewoods' support stems from his friendships with company executives, who have lodged him in their homes when he visits London. He says English lawyers socialize more with clients than do their American counterparts and expect to have regular face-to-face contact.
"In Morristown, at the end of the day, lawyers get in the car and go home," Kelly said. "It's different in London. You spend a lot more time with British clients at dinner, at lunch, entertaining. If you're in the office at 5, you'll go to the pub afterwards and have a glass of beer." Though Kelly says he's mindful that other U.S. firms have tried and failed to make a go of a London insurance practice, he says the firm has good odds of success because of the promise of steady Castlewoods work and to its bevy of local contacts.
Riker Danzig has been telling its U.S. clients about its London office, and has seen particular interest in the new venture among banking clients, says Kelly. He adds that the firm also hopes to get work from British companies with U.S. operations that need advice in areas such as real estate or taxation, he says.
The firm was set to hold a reception in London today to celebrate the opening of the new office, and representatives of about 40 insurance companies were expected to attend. Riker, Danzig also has offices in New York and Trenton, N.J.
posted by Jones Lang LaSalle NJ News Blog at 12:14 PM
JV Proposes 550,000-SF W/D Complex By Eric Peterson
JERSEY CITY-Rockefeller Group Development and partner MC Realty are proposing to build a warehouse/distribution complex of upwards of 550,000 sf on a 40-acre site along this city’s border with the town of Secaucus. The site, acquired earlier this year by the two companies, is near the new Exit 15X of the New Jersey Turnpike and the Frank Lautenberg Train Station. "New Jersey represents significant potential for growth in the industrial real estate market because of its proximity to major highways, ports and metropolitan areas," says Les Smith, EVP of development for the New York City-based RGDC. "RGDC and MC Realty intend to pursue joint ventures for other potential real estate development projects in the future."
The 40-acre site is unusual in that it is one of just a handful of undeveloped sites left in the Meadowlands market. The project, which will have foreign-trade zone status with that application process under way, is mapped out for either a single building of 525,000 sf, or two buildings totaling nearly 550,000 sf. Under the latter scenario, one building would be in the 400,000-sf range, the other approximately 145,000 sf. The partners are pursuing a build-to-suit opportunity for either lease or purchase, according to Smith.
"We are committed to investing in the development of quality industrial complexes in major US markets," says MC Realty president Hiroshi Matsumoto. "Given RGDC’s expertise and success in developing FTZs, we feel our joint venture will enhance that success." The Los Angeles-based MC Realty is a wholly owned subsidiary of Mitsubishi Corp., formed in 1994 to manage that company’s real estate investments. Mitsubishi Corp. is not related to Mitsubishi Estate Co. Ltd., parent company of the Rockefeller Group.
In Major Projects, Agreeing Not to Disagree By TERRY PRISTIN
To blunt opposition to its proposed Atlantic Yards project in Brooklyn, Forest City Ratner promised to make half of the rental units affordable for low- and moderate-income families. To gain neighbors' support for its new cancer care center, Yale-New Haven Hospital agreed to create an outreach program for children with asthma.
And to smooth the way for its Gateway Center retail project, which will replace the Bronx Terminal Market, the Related Companies pledged to bar Wal-Mart as a tenant.
In New York and around the country, it has become standard practice for developers of major projects to negotiate with neighborhood and other groups to forge so-called community benefits agreements — contracts that almost always contain wage and hiring goals and may also include a grab bag of concessions, like a day care center, a new park, free tickets to sports events and cash outlays to be administered by the groups themselves.
In New York, in contrast with many other jurisdictions, the city itself is not a party to these agreements. Theoretically, at least, the pacts are not supposed to play a role in the city's zoning review process.
Since 2001, when a comprehensive community benefits agreement was struck for a hotel-and-entertainment project now being developed in Los Angeles next to the Staples Center sports arena, the trend has quickly spread to other cities, including Denver, Milwaukee, Chicago and Washington. Advocates of C.B.A.'s, as they are known, see them as an outgrowth of the Smart Growth movement — the idea that development decisions should address a broad range of social and economic issues like transportation, jobs and housing.
In New York, however, some critics are wondering if this trend is threatening to distort the planning process. They say the danger is that local groups will agree not to oppose the projects in exchange for favors that may be unrelated to the project's impact on the neighborhood.
Critics of the Atlantic Yards (whose developer is a partner to The New York Times Company in its new headquarters building on Eighth Avenue) and other agreements have questioned whether the groups signing the document really speak for the community. "Groups pop up and you're not sure who they represent," said Patricia A. Jones, the co-chairwoman of the Manhattan Community Board 9 task force on Columbia University's expansion in Manhattanville. Ms. Jones contends that development plans ought to be reviewed by community boards, which are currently excluded from the C.B.A. process, before the benefits are meted out. "They can look at the bigger picture," she said.
Ross F. Moskowitz, a real estate partner at the law firm Stroock & Stroock & Lavan, said developers would like the procedures to be clearer and more predictable. "The danger of a C.B.A. is that it is outside the process," he said. "There are no guidelines, no controls. The transparency is not there. You just don't know what you're walking into."
In California, leaders of the community benefits movement say New York's agreements lack the protections that are standard elsewhere. "In the C.B.A.'s we work on," said Julian Gross, the legal director of the California Partnership for Working Families, an advocacy group that has negotiated a number of agreements, "the city is closely involved in the negotiations. There's no point in the community group and the developer negotiating a lot of stuff that the city doesn't want."
Outside New York, benefit agreements are usually incorporated into the developer's agreement with the city, adding another layer of enforcement.
The local redevelopment agency was "intimately involved" in the C.B.A. that J. H. Snyder, a Los Angeles developer, negotiated for NoHo Commons, a 1.5-million-square-foot mixed-use project centered on a subway stop in North Hollywood, said Clifford Goldstein, a senior partner. "It's a very open process," said Mr. Goldstein, who is currently working on another C.B.A. for a project in South Los Angeles.
Carl Weisbrod, the president of Trinity Real Estate in New York, said that the government should be involved in any agreement that pertained to a subsidized project to ensure that "the services and the organizations that are being given money to provide the services are fully in keeping with government priorities."
There are signs that Mayor Michael R. Bloomberg's administration is rethinking its position on community benefits agreements. A year ago, it was the mayor himself who trumpeted the Atlantic Yards agreement between Forest City Ratner and eight community groups.
But in April, the mayor reacted angrily to the suggestion that the Mets would negotiate a C.B.A. for its new ballpark. "Every development project in this city is not going to be a horn of plenty for everybody else that wants to grab something," the mayor said. And while the Mets agreed after heated discussions with council members from Queens to contribute $50 million over 20 years to local community groups, no C.B.A. was signed.
The mayor's office declined requests for interviews with city officials, saying it was premature to discuss the administration's plans for C.B.A.'s.
Several land-use specialists said the debate over community benefits agreements was a throwback to the 1980's, when local groups in New York often leveraged their support for development projects to get libraries, parks and other amenities. Critics at that time also said it was unfair for a community's chance to get a park to hinge on its ability to attract a deep-pocketed developer, said Margaret P. Stix, a land-use lawyer.
In an influential 1988 report, the New York City Bar Association said that some politicians had approved projects solely to get unrelated benefits, thereby corrupting the zoning process. The lawyers' group recommended that any amenities promised by a developer have a reasonable relationship to the project, a practice that successive administrations adopted, said Jesse Masyr, the lawyer who negotiated the Bronx Terminal Market agreement.
In the 1990's, Mr. Masyr said, the Giuliani administration barred his client, the Blumenfeld Development Group, from providing a park to appease opponents of East River Plaza, a shopping center now under construction in East Harlem. They reasoned that testimony from people who had received a benefit unrelated to the project could taint the zoning review process, he said.
But the current administration has taken a more hands-off approach, Mr. Masyr said. "I'll tell you what I think is the most dicey part of this: there's cash involved, money payments to be made. Who monitors it?" he said. "This is about as unregulated a world as you could imagine." In California, leaders of the community benefits movement that are party to an agreement never accept money from the developer, said Madeline Janis-Aparicio, the executive director of the Los Angeles Alliance for a New Economy, a nonprofit research group. "No donations of any kind," she said. She also said it took six months to a year to pull together a coalition before negotiations could begin. "You can't skip steps," she said.
Melinda R. Katz, chairwoman of the City Council's land use committee, said that New York officials were examining how other cities handled community benefits agreements. "We can probably learn a lot from other jurisdictions," she said. "And we're in the process of doing that."
posted by Jones Lang LaSalle NJ News Blog at 12:13 PM
State jobless rate dips to 5 percent Wednesday, June 14, 2006
BY TOM JOHNSON The state's jobless rate declined to 5 percent last month, but continued to run above the nation's 4.6 percent unemployment rate despite the creation of 6,900 jobs in New Jersey, the biggest jump in eight months.
The increase in jobs reflects a fairly strong labor market, economists said, as it marked the fourth consecutive month where the number of jobs increased.
"The labor market is getting a little bit better each month," said Joel Naroff, chief economist for Commerce Bank. "The state's economy is in good shape, but it's not in great shape."
In April, the state's unemployment rate surged to 5.1 percent, a huge jump from the 4.5 percent rate in March. It pushed the New Jersey rate higher than the national rate for the first time in nearly three years.
The April jump caused some economists to wonder whether it was a statistical anomaly, given that 6,200 jobs were added in the month. "The state's unemployment numbers have a tendency to bound around a lot," Naroff said.
According to the state Department of Labor and Workforce, the number of unemployed New Jerseyans dropped to 223,000 in May from 231,3000 in April, based on survey of households. The state said 4.1 million others held jobs in May.
State officials said the increase in jobs -- the largest rise since 8,100 jobs were added between last August and September -- reflects optimism in the economic outlook.
"Four straight months of job gains and record high employment levels are good signs for our economy and reflect confidence by businesses in Gov. Corzine's approach to the budget and economic growth," said acting Commissioner David Socolow.
Economists weren't quite as en thusiastic.
"It's a mixed bag," said Jack Worrall, a professor of economics at Rutgers University in Camden, not ing in some areas the labor market is strong, such as North Jersey and parts of South Jersey, while the Jersey Shore is a bit sluggish.
Most of the job gains occurred in the private sector with the trades, transportation and utilities accounting for the majority of the increase, with 4,300 jobs, while the education and health-service sec tors added 3,200 jobs. In the high- paying professional, business services and financial sectors, gains were more modest, with only 600 jobs added among the three sec tors.
On the negative side, manufacturing continued its long-term decline, with jobs falling by 900 to a level of 320,100. Public sector employment fell, too, by 800 jobs, reflecting a drop in the number of federal and local government jobs.
Kushner Portfolio Could Fetch $2B By Eric Peterson
FLORHAM PARK, NJ-Kushner Cos. may be on the verge of pulling the trigger on one of the biggest real estate deals ever in New Jersey. According to published reports, the company is mulling the sale of its Westminster Management division, which consists of some 17,500 rental apartments in 90 properties in several states, and the final number could be in the $2-billion range.
"There have been offers received for the Westminster apartment portfolio of the Kushner Cos., consisting of 17,500 garden apartment units," Clive Cummis, the company’s acting vice-chairman confirms for GlobeSt.com. "They started a process whereby Goldman Sachs has been engaged to advise the company with respect to these offers."
Sources say that process began with four unsolicited offers, including two from REITs and one from a banking institution. Cummis will only confirm that the number of offers is "in that area," and declined further comment on the nature of the bidders.
Cummis does confirm that the bids amount to approximately 40% of Kushner Cos.’ total holdings. Not included are several major development projects currently under way, including residential condo and mixed-use properties in Perth Amboy, Asbury Park and Atlantic City, plus New York City and Port Jervis, NY. Kushner also owns and/or manages some five million sf of office, industrial and retail space, similarly not part of the offers.
Asked about deciding factors on whether the company will sell its rental portfolio, and to whom, "price," Cummis tells GlobeSt.com. Cummis, an attorney, is part of a management team including fellow attorney and acting chairman Alan Hammer, put in place to run Kushner Cos. in 2004 when founder and chairman Charles Kushner was indicted on charges of witness tampering relating to federal campaign-finance and tax violations. Kushner is currently completing a two-year jail sentence at a halfway house in Newark and is slated to return to the company in September. Company officials say they have not discussed the bids with Kushner and would not until his sentence is completed. For previous articles on the issue, click here. By then, a deal might already be done. Asked about a possible timeline, "no decision has been made and the offers are being considered," Cummis tells GlobeSt.com. "A decision would probably be made within the next 30 to 45 days."
PTC, CV In Potential $345M Cardiovascular Agreement By Karen Pihl-Carey Senior Staff Writer
Less than three months after signing its first major preclinical deal focused on infectious disease, PTC Therapeutics Inc. topped it with a new cardiovascular collaboration worth up to $345 million with CV Therapeutics Inc.
South Plainfield, N.J.-based PTC will apply its Gene Expression Modulation by Small-Molecules (GEMS) technology to develop orally bioavailable small molecules. Together, the companies will select five targets, including those known to raise HDL and be involved in dyslipidemia and diabetes.
"The technology can be applied virtually to any therapeutic area," said Claudia Hirawat, the company's senior vice president of corporate development. "This is our first effort into addressing a therapeutic area where we don't have internal expertise."
While the main focus of the collaboration will be on cardiovascular indications, PTC does have the freedom to "dabble into other areas," she said.
CV Therapeutics, of Palo Alto, Calif., will pay PTC $10 million up front, consisting of $2 million in cash and two loans of $8 million total. One loan is forgivable as long as the research remains in effect, and the other loan is convertible into PTC equity.
If CV Therapeutics chooses to take certain compounds into development, it has an exclusive option to gain worldwide, exclusive rights for each or several targets.
If exercised, PTC would receive royalties on worldwide net sales. Assuming all five targets are selected by CV Therapeutics, PTC could earn up to $335 million in milestone payments based on development, regulatory and commercial achievements. It also retains an option to co-fund research and development in return for increased royalties or co-promotion rights.
The licensing deal with CV Therapeutics is part of PTC's strategy to leverage its GEMS technology outside of its core research areas, which include genetic disorders, oncology and infectious diseases.
Late last year, the company licensed certain compounds from its anti-angiogenesis program to Bausch & Lomb, of Rochester, N.Y., for use in ophthalmology indications. That agreement is in line with the same strategy, although it is not a discovery collaboration like the one with CV Therapeutics. "We had already identified those compounds as part of our oncology screen," Hirawat said.
In March, PTC signed a deal potentially worth $200 million with Kenilworth, N.J.-based Schering-Plough Corp. focused on small-molecule candidates that inhibit the hepatitis C virus internal ribosome entry site (IRES)-mediated production of viral proteins. Schering is responsible for clinical development and worldwide commercialization. (See BioWorld Today, March 21, 2006.)
Internally, PTC is advancing PTC124 in three Phase II trials for genetic disorders, including Duchenne's muscular dystrophy and cystic fibrosis in cases in which a nonsense mutation is the cause of the diseases. The drug has orphan status for both indications.
Interim results of the cystic fibrosis trial, announced in April, suggested that PTC124 might have pharmacological activity that addresses the underlying cause of CF in patients with a nonsense mutation. Both the CF and DMD trials are expected to be completed in the second half of this year. The DMD nonsense mutation, which occurs in about 15 percent of the DMD cases, is found in the dystrophin gene. About 10 percent of the cystic fibrosis cases are caused by a nonsense mutation of the CF transmembrane regulator gene.
PTC also has its anti-angiogenic compound PTC299 - an oral inhibitor of vascular endothelial growth factor - in Phase I testing for cancer. Derived from the GEMS screening technology, it modulates gene expression by targeting the post-transcriptional control processes that act through the untranslated regions of messenger RNA molecules.
"In a matter of four years, we went from a concept to being in Phase I," Hirawat said, adding that a major advantage of the GEMS technology is its ability to address targets like IRES that researchers are "not able to tackle with traditional drug discovery."
"With GEMS," she told BioWorld Today, "you can actually either up-regulate or down-regulate protein expression using small-molecule drugs. As far as we know, there's no other way to do that."
John Bluth, CV Therapeutics' senior director of corporate communications, said his company's interest in the technology is its ability to "accelerate the arrival of treatments to the market." Among CV Therapeutics' approved products are Ranexa (ranolazine) for chronic angina and Aceon (perindopril erbumine) for coronary artery disease or hypertension. It also is developing regadenoson in Phase III trials as a pharmacologic stress agent in myocardial perfusion imaging studies, and it is conducting a study under a special protocol assessment agreement with the FDA to gain approval of Ranexa as first-line chronic angina therapy.
The company went public in 1996. Its stock (NASDAQ:CVTX) fell 77 cents Monday to close at $14.16.
Founded in 1998, PTC raised $26.6 million in a private placement in November, bringing the total venture capital and grant money brought in since inception to $139 million. The money was expected to last the firm through early 2007.
In April, PTC filed for an initial public offering to raise $86.3 million.
Published June 13, 2006
posted by Jones Lang LaSalle NJ News Blog at 12:10 PM
Senate Considers Xanadu Sales Tax Bill By Eric Peterson
TRENTON-The State Senate’s transportation committee is slated today to consider a bill (S-1790) that would funnel 60% of the sales taxes generated by the Meadowlands Xanadu shopping and entertainment complex to Bergen County. The complex, under construction and scheduled to open by the end of 2007, is located in East Rutherford in Bergen County. It is being developed by Mills Corp. and Mack-Cali.
Specifically, the estimated proceeds of $17 million a year would go to pay for road improvements along Route 3 from Lyndhurst to Secaucus, and Route 17 from Ridgewood to its intersection with Route 3. If passed, the legislation would set up a special account that would be administered by the New Jersey Meadowlands Commission, a state agency.
"It is only fitting that some of the new revenue…that will be generated by [Xanadu] be set aside for these road projects in order to alleviate the negative impact which this state-approved major development will have," S-1790’s introduction reads. Prime sponsors of the bill are senators Paul Sarlo (D-Bergen) and Joseph Coniglio (D-Bergen).
Holly Springs in Running For $350M Biopharmaceutical Plant, Up to 400 New Jobs
HOLLY SPRINGS, N.C. – Holly Springs is in the running to land a "major biopharmaceutical" firm that would spend as much as $350 million and create up to 400 jobs, according to a grant from the Golden Leaf Foundation. (An earlier version of this story incorrectly attributed the information to the town attorney for Holly Springs.)
To help land the company, which town officials would not identify, the Golden Leaf Foundation has awarded Holly Springs a grant of $800,000.
In announcing the grant Tuesday, the Foundation said the "economic catalyst grant" would be used for design fees "related to infrastructure improvements required" for the biopharma firm to locate in the town.
However, Town Attorney John Schifano declined to discuss specifics. The grant is "related to an ongoing economic recruitment project," Schifano said but added, "I don’t have any further details for the project."
Citing "competitive reasons", Schifano would not disclose the name of the company being recruited.
Holly Springs was among the possible sites considered for a new plant to be built by pharmaceutical giant Bristol-Myers Squibb. However, that company rejected North Carolina last week, instead picking a location in Massachusetts. That plant is expected to cost $1 billion and produce as many as 700 jobs.
Schifano said the Golden Leaf grant and the ongoing talks were not related to the Bristol-Myers Squibb negotiations.
Charles Hayes, president and chief executive officer of the Research Triangle Regional Partnership, confirmed that a company was in fact being recruited for Holly Springs. He said talks were "ongoing" but added, "We don’t comment on ongoing discussions."
At a Triangle business event two weeks ago, Hayes said industrial recruiters from state and local governments as well as other agencies were involved in negotiations for plant and business locations worth $5.2 billion that could generate 8,500 jobs.
North Carolina has made recruitment of biopharmaceutical firms a major priority in its industrial recruitment efforts. United Therapeutics recently chose to build a $50 million plant in Durham rather than Maryland. The facility will create 160 new jobs. Stiefel Laboratories announced last November that it would occupy a former Eli Lilly subsidiary facility in Research Triangle Park, creating some 200 jobs.
The Golden Leaf Foundation utilizes funds received from tobacco companies as part of the national tobacco suit settlement to help foster education and economic improvement projects across the state.
posted by Jones Lang LaSalle NJ News Blog at 12:09 PM
The California gold rush that began last year with the strengthening of our San Francisco and Los Angeles offices continues with the opening of a new location in West Los Angeles. The West L.A. office will house 22 professionals, including Markets teams led by Managing Directors Lisa St. John and Peter Best and Capital Markets groups led by Managing Directors Larry Krasner and Dave Doupe. The new office is located in the 2.2 million s.f. Century Plaza Towers owned by JPMorgan Chase, one of our largest institutional clients.
"West Los Angeles is one of the hottest real estate markets in California, with 54 million square feet," Lisa said. "Our firm has several institutional clients that either own or lease properties in the area, or do business there." Besides JPMorgan Chase, other major Jones Lang LaSalle clients in the neighborhood include Archon, Arden Realty and Beacon Capital.
The region is also a rich prospective environment for project management services, agency leasing and management assignments, and local tenant representation work. The new office forms a natural bridge with our downtown Los Angeles office because many clients and prospects are located in both areas.
"Our clients want us closer," said Lisa, "and it will definitely help to have people right on the ground in West L.A. to service accounts. This physical presence demonstrates our commitment and underscores our knowledge of that market."
"Opening this office is definitely in line with our firm’s strategic initiative to grow our footprint on the West Coast," added California Markets Operations Director Elizabeth Hearle. "In the last year we’ve raised ourselves to the number 3 firm in downtown Los Angeles, when before we weren’t even in the top tier. Now, that’s our goal for West L.A."
The address for the new office is 2049 Century Park East, Suite 2750, Los Angeles, CA 90067. The phone number for the reception desk is +1 310 595 3660. The office's fax number is +1 310 595 3659.
posted by Jones Lang LaSalle NJ News Blog at 12:09 PM
Cowen Sets IPO Size, Range Monday June 12, 11:36 am ET Cowen Sets IPO Size, Range; to Raise Up to $235 Million
WASHINGTON (AP) -- Cowen Group Inc., a New York-based investment bank that's a unit of French bank Societe Generale, set the parameters of its initial public offering Monday, saying it would seek to raise as much as $235 million.
Cowen said in a filing with the U.S. Securities and Exchange Commission that it plans to sell 11.2 million shares for $19 to $21 each.
The company has applied to list its stock on the Nasdaq Stock Market under the symbol "COWN." Underwriters haven't yet set a date for the offering.
Cowen's offering will likely be the second in its industry this year. San Francisco investment-banking boutique Thomas Weisel Partners Group Inc. went public in February, gaining 33 percent on its first day of trading. Three other IPOs in the sector are also expected at some time this year: Ryan Beck Holdings Inc. and Evercore Partners Inc. have already filed initial documents with the SEC, while Keefe Bruyette & Woods Inc. has plans for that, too.
Cowen Group originally filed in March for an IPO of up to $100 million in stock.
The IPO proceeds will flow to Societe Generale, which will completely divest itself of Cowen ownership if the IPO and a subsequent over-allotment of shares are fully sold.
Cowen plans to grant four of its top executive officers, together with 81 other senior employees, 2.1 million shares of restricted stock immediately after the offering. The restricted stock, worth $42 million, will represent 14 percent of the company. The company is also giving employees options to purchase 1.1 million shares, or 7.5 percent of its outstanding stock, with a grant value of $8.7 million.
Cowen's total revenue in the first quarter rose 29 percent to $105.6 million, and its net income nearly quadrupled to $36.5 million, compared with the same period in 2005.
Cowen, Credit Suisse Group and Merrill Lynch & Co. are the lead underwriters on the offering.
posted by Jones Lang LaSalle NJ News Blog at 12:08 PM
Children’s Place Leases 245,000 SF By Eric Peterson (For more retail coverage, click GlobeSt.com/RETAIL and to read more on the industrial market, click here.)
SECAUCUS, NJ-The Children’s Place has signed a lease for 245,200 sf, representing the entire building at 2 Emerson Lane here. The asset is owned by the locally based Hartz Mountain Industries and is located within that company’s Harmon Cove warehouse district in the Meadowlands submarket.
For the Children’s Place, the signing marks a headquarters relocation, albeit a short one in terms of distance. The retailer will be moving its corporate offices, as well as related warehousing and distribution operations, to 2 Emerson Lane from the nearby 915 Secaucus Rd., another Hartz-owned property, where it currently occupies 183,000 sf. That relocation is expected to be completed by early 2007, according to a Hartz spokesman. Terms of the lease were not disclosed.
"Harmon Cove has been the location of our corporate office since 1999," says Steve Balasiano, senior vice president and chief administrative officer for the Children’s Place. "Our corporate headcount in Secaucus has grown from approximately 100 employees to more than 600 employees in that time to support the growth of the company. A larger facility is necessary to facilitate our continued growth and expansion."
The Children’s Place Retail Stores Inc. designs, contracts to manufacture and sells merchandise under the proprietary "the Children’s Place" and licensed "Disney Store" brands. The company currently owns and operates 811 the Children’s Place and 317 Disney stores in North America. Meanwhile, leasing activity remains strong at Harmon Cove, Hartz Mountain’s 750-acre Harmon Cove mixed use development, according to Emanuel Stern, the company’s president and COO. "Surging interest in the New Jersey Turnpike’s Exit 15X continues to fuel the Meadowlands industrial and office market."
Stern says the opening of 15X has established a highly visible second point of entry into Harmon Cove, which is one of the factors contributing to the heavy leasing activity. "15X is a win-win situation with its location, the [Frank Lautenberg] rail station, access to Manhattan and the ports. Anytime there are industrial properties within a few miles of mass transit options, there will be tenants who will take advantage of the opportunity."
BASF says it'll form global unit in Jersey Top exec looks ahead after Engelhard merger Tuesday, June 13, 2006 BY JOSEPH R. PERONE Star-Ledger Staff
German chemical company BASF plans to form a global catalyst division in New Jersey as it di gests its $5.6 billion acquisition of Iselin-based Engelhard, BASF executives said.
The lo cation of the headquarters will be at a yet-to-be-determined site, and the company will maintain research and development labs in the state, said Klaus Peter Lobbe, chief executive of BASF in Florham Park, the North American unit of the world's largest chemical company. The labs and Engelhard's former headquarters are in Iselin.
Wayne Smith will become president of the new BASF division. It will be the first time BASF has formed a division for automotive catalysts that scrub engine exhaust to remove harmful pollutants, Lobbe said.
Since 2004, Smith had been group vice president for the company's North American intermediates business, which makes more than 600 chemicals used to produce detergent, plastics, textiles, paints, coatings, medicine and crop protectants. Smith was recruited two years ago from competitor W.R. Grace.
The Engelhard name disap peared from Wall Street yesterday as the company's stock was delisted by the New York Stock Ex change. Engelhard fought BASF's hostile takeover attempt for more than five months before agreeing to a merger two weeks ago.
Lobbe said the company will cut some duplicative headquarters jobs, but he declined to provide a precise number. Engelhard has 650 employees at headquarters in Iselin and at sites in Union and East Newark. BASF employs 1,500 workers at headquarters in Florham Park and locations in Belvidere and Washington in Warren County. BASF also is acquiring the construction chemicals business of De gussa, which has an operation in Mine Hill.
Lobbe, 60, has spent four decades with BASF. He gave his first interview since the merger Friday after he and former Engelhard Chief Executive Barry Perry spoke to nearly 700 Engelhard employees during a meeting in East Brunswick:
How did the employees react to what you told them? We have some enthusiasm and excitement in the Engelhard crowd. But now comes the hard work. We have to make it happen. It is rather easy to sign the check on this decision and make Engel hard management happy. The more critical part is to integrate the Engelhard employees. Will you cut some jobs? Yes, some jobs. But I can't give you a number. There will be some cost synergies. But why make people nervous at this point in time, when we don't know how many? Definitely, in the administrative-function areas like information technology, fi nance, human resources, legal, lo gistics, purchasing and procurement, we will have some syner gies.
What will you change? We will have an operating di vision in New Jersey that is responsible for catalysts worldwide. This shows the attractiveness and the importance of this business for the BASF group. We didn't have any division before. Previously, our catalyst business was part of the chemicals divi sion. During the next two or three months, we will learn more about both sides and then we will decide on where the headquarters will be. One thing is sure, part of the Iselin organization is the R&D facility, and that will not change. Can you understand the employees' reticence about BASF because of the hostile takeover? All in all, we appreciate that the process is over now. Believe me, we didn't like that it turned into a hostile takeover. We meant from the beginning that it could be done in an amicable way. At the end of the day, we came to a friendly solution for the employees and for the business.
What are the synergies between the two companies? To give you one example, Engelhard is very strong in the automotive catalyst business. They have close links to the car manufacturers. We had a little, tiny catalyst business worldwide. Now, we added a big piece from Engelhard. BASF has long-standing links to the car manufactur ers, as well. We have coatings, plastics and gasoline additives. How will your pigments business change? We have a pigment business that is directed to textiles and to automotive. What we get here is more into cosmetics and personal-care. We get stronger by combining our portfolios because we are the better choice for the customer. Do you have a succession plan for the day that you decide to retire? The only clear signal for me to retire is when the candles get more expensive than the cake.
Joseph R. Perone may be reached at jperone@starledger.com or (973) 392-4262.
The deal sweetener that would place Gibbons, Del Deo, Dolan, Griffinger & Vecchione's name atop a Newark skyscraper is getting a sour reaction from other law firms in the building. The tenants don't much care for being housed in a structure on which the name "Gibbons" looms large above the 30th floor - especially since they were never offered the same marquee billing.
posted by Jones Lang LaSalle NJ News Blog at 12:06 PM
Sports Illustrated building puts up some solid scores Veteran expanding at sidelined property; more frozen treats for Manhattan
Published on June 12, 2006
The 23-story tower at 135 W. 50th St., known as the Sports Illustrated building, is finally seeing action.
The property has been plagued by vacancies ever since the American Management Association's lease for 275,000 square feet expired in 2001. The 800,000-square-foot building remained half empty, with only four tenants, until late last year, when NBC leased all 28,500 square feet on the ninth floor.
Things have been looking up since then.
One of the few longtime tenants, accounting and consulting firm Weiser, has exercised an expansion provision. It will take an additional 28,000 square feet--the entire 14th floor--for a total of 90,000 square feet. Asking rents in the building, which is between Sixth and Seventh avenues, are $60 a square foot.
"Weiser's expansion tied into its existing lease that we restructured two years ago," says Arthur Draznin, an executive managing director at Newmark Knight Frank, which represented the tenant. The firm is building out the space and expects to take occupancy in the fall.
Less than 300,000 square feet--including one 154,000-square-foot space--remain vacant, according to Peter Turchin, a senior vice president at CB Richard Ellis.
"We have a number of deals that are pending," says Mr. Turchin, whose firm was hired as a co-agent several months ago by landlord Murray Hill Properties.
Other tenants include Time Inc., publisher of Sports Illustrated, which last year renewed its lease and expanded to a total of 240,000 square feet. Alliance Capital Management and accounting firm Berenson also have offices at 135 W. 50th St.
It was known as the American Management Association building until the group moved out in 1998. A year later, Time Warner leased 220,000 square feet and renamed the tower for its sports magazine.
Dr. Laszlo Tauber, a Hungarian-born surgeon and philanthropist, owned the building until his death in 2002. It was put on the market for $160 million the same year, and Norman Sturner of Murray Hill Properties bought it in 2004. --Julie Satow
posted by Jones Lang LaSalle NJ News Blog at 12:05 PM
