Friday, May 6, 2011

Keystone Property buys Liberty Mutual Building in Bala

by Natalie Kostelni

"Keystone Property Group has expanded its office holdings here and bought the Liberty Mutual building.

The private real estate developer, based in Bala, paid around $4 million for the 53,920-square-foot property at 15 Kings Grant Drive. The building was constructed in 1957 and has been owned and occupied by the insurance giant ever since.

As part of the transaction, Liberty Mutual signed a short-term lease and will remain in the structure for the time being, said Bill Glazer, president of Keystone.

Office properties infrequently come on the market here and a handful of landlords control the bulk of the buildings. Tishman Speyer is the largest owner of office buildings. It bought Bala Plaza, a four-building complex totaling a little more than 1 million square feet, in 2004. A more recent transaction was logged last August, when Goodman Properties of Jenkintown paid $5.35 million for 101 W. City Ave., a 75,000-square-foot property commonly referred to as the Van Sciver building.

When buildings do come on the market, an investor usually seize upon them.

“This is a unique sale because it’s one of the last remaining owner-occupied buildings in Bala,” said a broker. “Keystone was fortunate to be able to acquire the property from a user and add to their presence in the market.”

Keystone first dipped into the Bala market in 2006 when it paid nearly $19 million for the former Aamco headquarters, which it redeveloped and renamed One Presidential Blvd. It also moved its headquarters from Conshohocken to Bala.

“We’ve been looking for opportunities to increase our presence in this market,” Glazer said.

Keystone now owns a total of three office buildings in Bala. It also owns 225 City Ave., a 78,000-square-foot building commonly known as the Pegasus building for tenant Pegasus Communications Corp.

In the case of the Liberty Mutual building, the insurance company decided it made more sense for it to sell.

“If you look at their portfolio, they don’t own a lot of real estate. They basically lease across the country more than own.”

The company also is evaluating its presence in Bala, and while it will likely maintain a portion of its operations in the office submarket, it may relocate some employees further into the western suburbs.

The real estate company typically buys tired, outdated office buildings, totally renovates them and re-leases them."

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