Normandy Storms the Beaches
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Move over, Tishman. There's a new player packing heat in town, and they want deals. So Wednesday night Normandy Real Estate Partnersof Morristown, NJ, brought in its big guns to the Tysons Ritz, and threw down the welcome mat, and the gauntlet, to 100 power brokers and friends, from CB tsar John Germano to Cassidy money machine Bill Collins.
Finn Wentworth, left, Normandy's co-founder, used to be president of the holding company of the New YorkYankees, Nets, and Devils, so he is used to winning; and to that end, he schmoozes up former Cushman & Wakefieldregional head Brian McVay, who now slums as a broker again.
Normandy's arsenal includes a fund of $450 million, closed in early '06, which targets Boston, New York, and now Washington. About 41% has been deployed, around $80 million, in the Washington region. This year it wants to plow another $100 million into the region, which would leverage $400 million in buying power. Its preference is CBD or suburban office, but it’s also willing to look at opportunities in any emerging market and in multifamily, industrial, hotel, and retail as well. It helps if there's high barrier to entry. Normandy wants to be known as broker-friendly (it pays commissions on signing) and feels its competitive advantage is that it's hands-on, lean, and nimble.
For example, in connection with Morgan Stanley's purchase ofGlenborough Realty Trust, Normandy stepped up on short notice to purchase the majority of GRT’s east coast assets, including 213K foot, 12-story Capitol Place III on the Hill and 110K foot Quincy Crossing in Ballston. In December, it snatched up the $157 million Starco portfolio from the Army Air Force Mutual Aid Association. That's a group of 10 buildings that includes 127k feet on Wiehle in Reston used by DLA Piper,and 214k feet Stoneleigh in Westfields, 50% leased to Apptis. A couple of weeks ago they also closed on Northridge I in Herndon, 126k feet of class A leased to the SBA and Time Warner Cable, among others. They look for an IRR of 16-18% and to hold for 4-7 years.
Above, Normandy co-founder and acquisition honcho David Welsh is flanked by Holland & Knight workaholic David Silver (for whom the evening reception was merely lunch) and capital king Nick Pappas ofEastdil/Secured.
No complicated corporate structure for Normandy; and it’s proud of being vertically integrated, such as managing all its own properties. The investment committee meets each Monday morning at 9 AM for one to three hours under a conference room portrait of Morristown in the days of the Revolution when it was General Washington's headquarters. Hey, maybe it's that subliminal feeling of kinship that's given Morristown an interest in the other town associated with Washington.
Normandy General Counsel and Principal Ray Trevisan, left, who used to be at CBRE, with Normandy Managing Principal Jeff Gronning, who used to be CFO of Morgan Stanley's real estate investing business. Maybe they left those firms behind because this function had really good food.