“If you choose to stay in rural villages, you can only meet common village girls,” 👧 Anbang chairman Wu Xiaohui told Harvard students in ‘15. “Yet if you come to Paris, you will have the chance to lay your eyes on the Mona Lisa.” 💃 Wu was explaining the rationale for his insurance firm’s eye-popping mid 2010s buying spree of US trophy real estate, in which it dropped billions of dollars (at top, top dollar) for some of the country’s name-brand office and hotel assets (plus almost 666 Fifth, but that’s another story). The crown jewel of the pack was New York’s Waldorf Astoria, which Blackstone 💄 sold it in a $1.95B ($1.4M/ 🔑 ) deal. Wu was at the time earning comparisons to Buffett, but that didn’t last too long: The Chinese govt. made an example out of Anbang for being a systemically dangerous “gray rhino” 🦏, and in ‘18 Wu was sentenced to 18Y prison for fraud & embezzlement. Meanwhile, Anbang’s assets were handed over to a new state entity, Dajia👇

“You had these interlocking companies that owned shares of each other, and that allowed you to basically get infinite leverage.” 🎚
“You either die a hero or you live long enough to become the villain with GGP.” 🦹

This week on the pod, we discuss the House of Brookfield’s new overlord: Connor Teskey has a modest target – double AUM to $2T. We talk about the labyrinth that is Brookfield’s corporate structure – Bruce Flatt's not going away – and what CRE’s role in the ramp-up will be. We then look at the flurry of REIT take-privates, from Peakstone to Plymouth. And finally, we slip into resort casual and discuss a princely condo buyout payoff in West Palm Beach – 🐐 Steve Ross makes an appearance. Plus, our "Punch List" of the newsiest industry happenings: Shvo's bitter breakup with German pension fund BVK; Blackstone & DivcoWest's SF triumph; and tranche warfare in the mall space.

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The Waldorf underwent a monstrously expensive and painfully long renovation that included a 372-unit resi condo conversion, w/ all-in costs on the property ballooning to north of $4B. Now, Dajia is shopping the overhauled hotel (a slimmer 375 keys) and retail via Eastdil and hopes to get north of $1B, per WSJ. It’s a good time to be selling top-end hotels in NYC; we heard that Gencom is paying $1.2M/ 🔑 for the Ritz Central Park.

BTW, the Waldorf’s not all Dajia (US main man Jeffrey Kleiner) is looking to unload: Per REA, it’s also tapped Eastdil to prep an offering of “Project Vanguard,” which consists of properties from the Strategic Hotels & Resorts portfolio it bought in a $5.5B deal in ‘16. (The seller there was also Blackstone, which milked the Chinese wave like perhaps no other.) Dajia struck a deal in ‘19 to sell the package to Korean conglomerate Mirae for $5.8B, but Mirae pulled out during the pandemic, and even successfully recouped its 10% deposit after a legal battle.

Bonus: Pondmoon & Friends – Spotlight on the Chinese firms still in the US game

Antsy about sitting on the sidelines while its coveted DUS licenses go for big bucks between third-party lenders, Fannie Mae is teasing a new transaction fee of up to $25M on any deals. Fannie could even look to levy the fee on the most recent in-progress trade, per CMA, which is Fifth Third’s $130M deal for the Mechanics/HomeStreet license. Now, to us, it seems a bit cavalier to come in after a deal is struck and demand to wet your beak 🐦 – the full $25M applied to this deal equates to a whopping 19% fee (what is this, Ticketmaster?) – but in the Pulte era, anything is possible.

Moreover, licenses are strange assets – they can be worth a lot more to one lender than another, depending on how they fit into a lender’s overall offering. Slapping a fat fee on trades could ice out smaller bidders. Recent demand has been hot, particularly given the upped purchase caps for both Fannie and Freddie. Triple-threat holder Lument is shopping itself at a reportedly $1B+ price tag and BWE (part-owned by Fifth Third) is also testing the waters, per CMA.

More agency news: Freddie considering overhaul of SBL program

On Wednesday, Promote Insiders got a closer look at the most acquisitive duo in today’s national office market – David Werner & Harry Skydell. Sign up now to get exclusive deel deets, expert breakdowns and a lot more.

Rodeo Drive tongues have been wagging since the summer, when a mystery buyer agreed to pay $400M+ for 338 N. Rodeo Dr. Now WSJ has word that the buyer is French luxe goods co. Hermès 🧣, which also owns its current Beverly Hills flagship on the frou-frou strip. (Arch-rival LVMH owns about half the block.) Hermès’ new holdings are leased to Tom Ford, Moncler and Balenciaga, which have some time on their leases. But if it does decide to make the location its new flagship, it’ll have about twice as much space as it currently does. Asking retail rents are up nearly 50% from ‘19, per CBRE, and there will be more tony space to come what w/ the development of One Beverly Hills (our backstory on that project is a must-listen)

Tip o’ the tweed cap to seller Ronan McNamee, who bought 338 N. for $2,900/ 🦶 in ‘07, refi’d at $5,600/ 🦶, and exited at $14K/ 🦶

Bonus: The LVMH-Kering trophy real estate war