Tuesday, August 30, 2011

Eastern Warehouse Distributors, Inc. acquires 110,000 square foot building

"AutoParts Warehouse acquires 1050 Wheeler Way, Bucks County Business Park, Langhorne, PA.

AutoParts Warehouse acquired 1050 Wheeler Way, Bucks County Business Park, Langhorne, Bucks County, PA. The 110,000 square foot one-story building located on 10.0 acres and former site to Domtar Paper Company, LLC sold for $3,800,000.

AutoParts Warehouse is a locally owned and operated wholesale automotive parts distributor, headquartered in Langhorne, PA, who have proudly served the professional installer since 1989 offering a selection of new and rebuilt parts. With 21 warehouses in the area and a fleet of more than 200 radio-dispatched delivery vehicles, AutoParts Warehouse is well stocked with quality parts and is able to provide quick delivery service throughout Eastern PA and NJ. Through its commitment to superior customer service, efficient operations and competitive pricing, the company has been able to become the dominant aftermarket parts provider in its service regions.

AutoParts Warehouse sells exclusively to professional installers. Its customer base includes independent garages, new and used car dealerships, fleet accounts and large national chains (Sears, Meineke, Firestone, PepBoys, Midas, Tires Plus, etc.) which typically make purchasing decisions on a store-by-store basis for non-stock items. AutoParts Warehouse has been able to grow its market share through aggressive pricing, marketing, service and inventory. Stephen Thorne, President of AutoParts Warehouse, advised that the company will retain ownership of its current location at 355 S. Flowers Mill Rd, Langhorne, PA, which facility consists of 48,232 SF on 11.92 acres and the companys executive offices will remain at the location as well as an import warehouse and the main warehouse and distribution will be operated out of the new Wheeler Way facility. The approx. 24,000+ SF to be vacated at S. Flowers Mill Rd will be marketed for lease."

Friday, August 26, 2011

MWI Veterinary Supply Relocates to Elizabethtown

"MWI Veterinary Supply, Inc, a distributor of animal health products, signed a 10-year lease for 111,000 square feet at 1499 Zeager Road in Elizabethtown, PA.

The single-story industrial building totals 277,800 square feet in the Conewago Industrial Park. The property was built in 1991 and the property owner The Jay Group has made a number of recent upgrades.

MWI is relocating its regional distribution center from Harrisburg, PA to Elizabethtown and will be joining Butler Schein Animal Health, another distributor of animal health products, that moved into the building in January of this year."

Thursday, August 25, 2011

Tile Market of Delaware Signs 10-Year Lease

"Tile Market of Delaware, Inc., an importer, distributor and retailer of ceramic tile, marble, and granite, leased 55,960 square feet of retail/commercial space located at 405 East Marsh Lane in Wilmington, DE. The space will include a design center and retail showroom.

Located in the Newport Industrial Park, the 104,300-square-foot industrial facility sits on over five acres of land."

Nihill & Riedley Moving to 1600 Market St.

"Accounting firm Nihill & Riedley, PC, has subleased the entire 32nd floor from a current law firm tenant at 1600 Market St. in Philadelphia. The firm will occupy slightly more than 22,600 square feet of office space.

The 39-story office tower measures more than 800,000 square feet. It was built in 1980 and renovated in the late 90's."

Krispy Kreme store opening South Jersey

by Peter Van Allen

"At least 100 people lined up for the Krispy Kreme Doughnuts opening in Collingswood, N.J., on Tuesday.

The store, at 1170 Haddon Ave., is the third in the Philadelphia area for the North Carolina-based doughnut chain.

Diehard doughnut fans camped out Monday night waiting for the 6 a.m. opening, which promised prizes for the first customers, according to tweets posted throughout the morning. Collingswood Mayor James Maley cut the ribbon to officially open the store.

It was opened by the local franchise group, Dough Nuts for Doughnuts LLC, which is based in Haverford, Pa. Other area locations are at 7855 Oxford Ave., in Northeast Philadelphia (Fox Chase), and 41 S. 16th St., Center City.

A Bensalem, Pa., opening is planned for November. The franchise group hopes to open up to 21 stores in 13 area counties.

Read more at: http://tinyurl.com/3mkeybs


Wednesday, August 24, 2011

Blatstein, Morris, Woodbury apartment projects funded

"$70 million raised for a string of Philadelphia projects in recent months:

- $21 million for Bart Blatstein's Tower Investments' Erbe apartment complex in Northern Liberties, through the Fannie Mae-backed Greystone lending group;

- $17 million for Federal Capital Partners and 806 Capital to convert the mostly vacant Robert Morris building, just north of Comcast Center, from offices into 111 "luxury apartments";

- $10 million for 806 Capital's further renovation of the former Northeastern Hospital as medical offices and labs for Temple University Health Services, on top of a previous investment of roughly the same size;

- $20 million for a bridge loan to help Media-based Capital Health Group build 228-unit Woodbury Mews as senior housing in Woodbury, NJ."

Carpenter Tech looks to build $500M factory

by Mike Armstrong

"The Wyomissing maker of stainless steel and titanium alloys said it intends to build a 400,000-square-foot factory to meet demand from the aerospace and energy industries. The project is estimated to cost $500 million, but Carpenter would say only that "several 200+ acre greenfield sites" are under consideration.

We should find out soon where the company, which employs about 3,000 people, will locate the factory, because its plans call for it to be operational in 30 months."

Tuesday, August 23, 2011

Physician Recommended Nutriceuticals move into Plymouth Meeting

Physician Recommended Nutriceuticals signed a 5 year lease for 8,621 sf at 502 West Germantown Pike, Plymouth Meeting, PA 19462.

Physician Recommended Nutriceuticals provides the purest, evidence-based and most therapeutically potent omega-based nutriceuticals possible.

More about the company: http://www.prnomegahealth.com/


Monday, August 22, 2011

Philadelphia's Industrial Vacancy Decreases to 9.1%

"The Philadelphia Industrial market ended the second quarter 2011 with a vacancy rate of 9.1%.

The vacancy rate was down over the previous quarter, with net absorption totaling positive 2,817,425 square feet in the second quarter. Vacant sublease space increased in the quarter, ending the quarter at 2,942,552 square feet.

Tenants moving into large blocks of space in 2011 include: Bay Valley Foods moving into 602,500 square feet at Key Distribution Center and Amazon moving into 483,200 square feet at 650 Boulder Dr.
Rental rates ended the second quarter at $4.41, a decrease over the previous quarter.

A total of two buildings delivered to the market in the quarter totaling 858,336 square feet, with 827,535 square feet still under construction at the end of the quarter.

This is compared to the U.S. national industrial vacancy rate, which decreased to 9.9% from the previous quarter, with net absorption positive 32.3 million square feet in the second quarter."

Full report at: http://omegare.com/Costar-2Q2011-Market-Report-Industrial.pdf


Friday, August 19, 2011

QlikTech plans growth, doubles office size

"When Qlik Technologies Inc. first set up shop here in 2006, its office was 4,000 square feet.

One initial public offering and a lot of growth later, the business-intelligence software developer recently more than doubled the size of its latest office, taking it from 10,000 to 23,000 square feet.

The immediate reason for the move was so the 100 people in the office “don’t have to sit on top of each other,” QlikTech CEO Lars Björk said.

But although QlikTech isn’t planning an immediate hiring binge, it does plan to fill the space “in two years or three years,” Björk said.

If the company can continue its growth to date, that shouldn’t be a problem.

QlikTech, which was founded in Sweden in 1993, had revenue of $44.2 million the year it opened its office here to take advantage of the U.S. market for its products. Last year, its revenue was $226.5 million and the average estimate of analysts polled by Thomson Reuters is that it will post $318.7 million in revenue this year.

As is often the case for fast-growing companies, QlikTech hasn’t been consistently profitable. It has lost money three of the last four quarters and lost $6.7 million, or 8 cents per diluted share, in the first half of this year.

But Björk isn’t worried.

“We feel that the best thing we can do is just to continue to invest and grab as much market share as possible in the shortest period of time,” he said.

“We are going to be profitable, but our focus is not on maximizing short-term profit. That wouldn’t be wise.”

QlikTech’s growth has been made possible by its flagship product, QlikView, which allows users to see whatever information they are allowed to see about their business or organization in the way that’s easiest for them to understand on whatever device they want to see it on.

“You don’t really require much, if any, training to navigate through this QlikView interface,” said Dan Vesset, the program vice president of business analytics for International Data Corp., the Framingham, Mass.-based market-intelligence firm.

QlikView isn’t all QlikTech has going for it.

Its strategy has been to go after midsize businesses that some of its larger competitors in the business-intelligence space, including Redwood Shores, Calif.-based Oracle Corp. and Walldorf, Germany-based SAP AG, which has its U.S. headquarters in Newtown Square, haven’t traditionally focused on as much.

“They have a very strong and very localized partner community within all the different countries that they operate in, so they are able to really provide that service and hand-holding to the midsize companies that maybe some of the larger companies will ignore or not treat as they want to be treated,” Vesset said.

Other analysts feel the same way.

In a January report, Stamford, Conn.-based Gartner Inc. put QlikTech in the “Magic Quadrant” of business-intelligence vendors based on its ability to execute its strategy and the completeness of its vision. Other BI vendors in that space included Oracle, SAP, Armonk, N.Y.-based IBM Corp. and Redmond, Wash.-based Microsoft Corp.

QlikTech is “the poster child for a new end-user-driven approach to BI” and QlikView’s “ease of use” is driving its adaptation, Gartner said.

Björk thinks the company can grow well beyond the nearly 1,000 employees it now has worldwide.

The BI market is growing at 6 percent annually and QlikTech only has from 2 to 2.5 percent of that market in the United States and Europe, he said.

“Most of our market opportunity is still definitely ahead of us,” he said."

Liberty Property buys prime downtown site

by Natalie Kostelni

"Liberty Property Trust bought a development site at 18th and Arch streets in Center City where a giant skyscraper called American Commerce Center was once proposed.

The Malvern real estate investment trust disclosed few details about the transaction other than confirming through a spokeswoman that an entity affiliated with Liberty acquired the 1.5-acre property and that funds used to buy the parcel were provided by a third party, whom it declined to name. The seller was the Multi-Employer Property Trust (MEPT), a union pension fund based in Seattle that was involved in the original partnership that initially bought the site four years ago.

The property, now operating as a surface parking lot, sold for a reported $40 million, or a staggering roughly $612 a square-foot for a downtown parcel. It last traded in the fall of 2007 for $30.5 million, or $490 a square foot, but that was before it was rezoned to accommodate a high-density commercial project.

With Liberty now controlling the site, speculation has begun to swirl about what the developer might do with it.

The company constructed Comcast Center for the cable and media giant just a stone’s throw away at 1701 John F. Kennedy Blvd., and some surmise Liberty may be planning an expansion office tower for Comcast Corp. or perhaps a combination of tenants currently swarming the market, such as the law firms Cozen O’Connor and Morgan Lewis among others. More titillating is the prospect of having a new company move into Center City that would take a chunk of new office space, but those types of deals are few and far between.

What’s promising is that a well-known, experienced local developer with deep pockets now owns the ground and has the ability to make something happen on it.

In 2008, a local developer under the name Walnut Street Associates (which included MEPT), and later in a partnership going under the name Hill International Real Estate Partners, proposed an $800 million, 2.2 million-square-foot skyscraper that would have stood as not only as the city’s tallest but the tallest in the United States. The 63-story building called the American Commerce Center would have stood 1,510 feet high, surpassing Comcast Center, which at 1,000 feet tall is the city’s tallest, and the Empire State Building.

The bold proposal would have had 1.3 million square feet of office space, a 300-room, high-end hotel and 315,000 square feet of retail space above and below street level. An underground garage would have 383 parking spaces. Though the city approved the zoning and plans for the ambitious tower, it never happened for a range of reasons including a lack of an anchor tenant to kick it off during the recession. The plan, however, showed the potential of what could be constructed on the site and at what scale.

Walnut Street Associates bought the property, one of the last remaining prime development sites in the Central Business District, from Verizon Communications Inc.

Other undeveloped downtown parcels that have sold include:

• Brandywine Realty Trust bought 1919 Market St., which is 33,746 square feet, at an auction for $9.3 million, or $275 a square foot;

• The Philadelphia Parking Authority sold to Castleway Properties a 36,267-square-foot parcel at 1907-1915 Walnut St. for $36.7 million, or $1,011 per square foot;

• Insurance Co. of North America sold a 22,145-square-foot lot at 100-118 N. 19th St. to Philadelphia Management Inc. for $8.4 million, or $379 a square foot;

• The land at 1441 Chestnut St. totaling 22,400 square feet sold at an auction for $12 million, or $535 a square foot."

Thursday, August 18, 2011

United Construction Services, Inc. Leases 14,000 Square Feet in Chester Springs

"United Construction Services, Inc., leased of approximately 14,000 square feet of flex space in Suite 9 located at 2075 Ticonderoga Boulevard in Chester Springs.

Eaglepointe Development Associates, the buildings owner, was represented by Eli Kahn of J. Loew & Associates.

2075 Ticonderoga Boulevard is a one story warehouse building situated in a 300,000 square foot industrial complex comprised of warehouse, flex and office space located just minutes from the Downingtown Interchange of the PA Turnpike."

Delaware Valley Surgical Supply signed a new lease for 36,000 square feet

 Delaware Valley Surgical Supply signed a new lease for 36,000 square feet of flex space at 3400 Horizon Drive, King of Prussia, Pennsylvania. The independent distributor of medical and surgical equipment will be moving out of their 25 Creek Circle location due to expansion. This long term lease will begin in January 2012.

Outer Banks LP Pays $2.1M for Two Ground Leases

"Outer Banks LP, a Pennsylvania-based investor, acquired the two absolute-net ground leases in Womelsdorf, PA, from Womelsdorf I LP for $2,125,000.

The two tenants involved in the lease were Fulton Bank Corporation and Turkey Hill, LP. Both are subject to a 15-year, net ground lease. They are located on Route 422 in Womelsdorf, PA which is located in the Berks County submarket."

Local School Signs 15 Year Lease in Conshohocken

"Academy in Manayunk (AIM), a private school for children with learning disabilities, will be relocating to River Park 2 at 1200 River Rd. in Conshohocken, PA. The school signed a 15-year lease and will occupy 61,483 square feet.

AIM will move into its new location in December over the school's winter break, and will be open by the time the students return to school on Jan 3rd, according to Erica Matsinger, special projects/events coordinator at AIM. AIM’s upper and lower schools are currently housed in separate buildings in Philadelphia, and will join Diccicco Battista Communications as the only tenants occupying the four-story, 71,800-square-foot office building."

EDiS tapped for $175M rebuild at Del. car plant

"EDiS, the Wilmington- and West Chester-based construction business that's been operated since 1908 by five generations of the Italian-immigrant DiSabatino family, has been named general contractor for Fisker Automotive's renovation of the former General Motors-Saturn plant in Stanton, just outside Wilmington, Del., writes the Wilmington News Journal here.

The US-loan-funded, $175 million rebuild of the plant, just west of Wilmington, Del., into an electric-car factory over the next year and a half.

EDiS is also working on the former Chrysler plant in Newark, Del., where the firm is building a bio lab for the University of Delaware.

EDiS, which has completed generations of building projects for the DuPont Co. and du Pont family projects, is one of several building and maintenance firms run by DiSab cousins in the area. Over the years it's developed ties that make it a builder of choice for government and industry clients in the Brandywine Valley."

Wegmans expands N.E. Pa. facility

"Wegmans Food Markets Inc., which has six stores in the Philadelphia region, is more than doubling the size of its 415,000-square-foot distribution center in Schuylkill County and adding more than 200 jobs over three years, the Pennsylvania Department of Community and Economic Development said. The current facility employs 415. The $65 million, 500,000-square-foot expansion, aided by $731,650 in state aid, is designed to support Wegmans' growth in Pennsylvania, New Jersey, Maryland, and Virginia, the company said. It is scheduled for completion in April. The center originally opened in 2004 and was expanded the next year."

Wednesday, August 17, 2011

Bottom Dollar to open third Philadelphia-area store

by Peter Van Allen

"Bottom Dollar Food will open a third store in Philadelphia, a real estate representative for the grocer said.

The 19,600-square-foot store is slated for the former Ilona Keller’s Dugan Banquet Hall at 7900 Roosevelt Blvd. in Northeast Philadelphia, the property is being developed for Food Lion, Bottom Dollar’s Salisbury, N.C.-based parent.

An opening date is planned for Feb. 17, 2012.

Bottom Dollar has 15 stores in the Philadelphia market, according to its website.

On Aug. 19, a Lansdowne, Pa., store will open at 48 W. Baltimore Ave. Another Northeast Philadelphia store, at 9303 Krewstown Road, opened Aug. 12.

Tuesday, August 16, 2011

Commercial MultiFamily Construction Starts Up 6.9%


Trading spaces: Mall to Market, Plymouth to Conshy

by Joseph N. DiStefano

"Five Tower Bridge, the West Conshohocken building built by Oliver Tyrone Pulver and owned by KBS Capital Advisors, says it's now 100% leased, since Wells Fargo & Co. sign to move into 11,000 sq ft there, from Plymouth Meeting; and Keystone Foods (now owned by Brazil's Marfrig Alimentos) has expanded from 44,000 to 50,000 sq ft.

Meanwhile in Center City, Smart Devine LP, the accounting firm created by former Smart & Co. bosses James Smart and Richard Devine last year, as Smart & Co. owner LECG Group imploded, has taken 23,000 sq ft at 1600 Market St., leaving the Public Ledger Building on Independence Mall, which owner Apollo Global Real Estate is trying to sell.

Smart and partners sold their $107M/yr firm in a deal valued at $118 million in 2007, at the peak of the private equity bubble, originally to Great Hill Partners. Since publicly-traded successor-owner LECG was unable to manage the resulting deal debt, ex-Smart accountants now work for a variety of Philadelphia-area accounting offices, including Smart Devine."

Monday, August 15, 2011

Multiple MultiFamily Deals and Leasing deals

by Natalie Kostelni

"Two suburban apartment projects are on the way though one is more eminent. That any new multifamily developments are coming out of the ground in the suburbs is of particular note since the barriers to entry are high and, let’s face it, any new construction from the private sector these days is rare occurrence. Multifamily (along with industrial) is the darling of commercial real estate these days is getting funding from Fannie and Freddie as well as banks.

E. Kahn Development Corp. of West Chester, Pa., expects to break ground this fall with Cornerstone Properties on a mixed-use project on East King Street in the heart of Malvern, Pa. The $35 million project will consist of 190 apartments, 25,000 square feet of retail and parking. Financing is lined up and the project will take roughly 20 months to complete.

Bolis Properties of King of Prussia, Pa., is working on the other apartment development. It bought the development rights to Appleview Apartments, a 200-unit, nine-building complex 41 acres at Horseshoe Pike and Bollinger Road in East Brandywine, Pa. It will include a clubhouse and pool as well as walking trails. The property is zoned for multifamily but Bolis needs to go through development approvals. Construct isn’t expected to start until 2013

Resource Real Estate of Philadelphia purchased the debt of two apartment developments, which is increasingly a way for investors to get a hold of properties on the cheap. It bought the note on the Iroquois, a 133-unit complex on City Avenue in Philadelphia for $12 million, a discount from the $15.1 million outstanding balance on it. Resource also bought School Lane House apartments, a 494 complex totaling 338,546 square feet at 5450 Wissahickon Ave. in Philadelphia, for $33 million.

Campus Apartments, a Philadelphia student housing company, expanded its third party management portfolio in four markets. It will now handle 506 beds in Ann Arbor, Mich., 756 beds under development in Tucson, Ariz., and assumed management of properties in two new markets, with 928 beds in Morgantown, W.Va., and 933 beds in Norfolk, Va.

Cheetah Transportation/Hawk Vision Moving & Storage leased 17,500 square feet at 85 Steamboat Drive in Warminster, Pa.

United Construction Services Inc. took 14,000 square feet of flex space at 2075 Ticonderoga Blvd. in Chester Springs, Pa."

Friday, August 12, 2011

Endo Pharmaceuticals looks to expand

by Natalie Kostelni

"Endo Pharmaceuticals Inc. is seeking to expand along the Route 202 Corridor. The company is in the market for more than 350,000 square feet so it can relocate its corporate headquarters from Chadds Ford.

The company has reportedly zeroed in on Valley Creek Corporate Center in Exton after having considered other properties in the Malvern area including Trammell Crow Co.’s Atwater Corporate Center, O’Neill Properties Group’s Uptown Worthington and options offered by Liberty Property Trust and other local developers. Endo has been on and off in the market for roughly two years having tabled its plans only to restart its search for 300,000 to 350,000 square feet of office space.

“We’re not disclosing anything at this time,” said Kevin Wiggins, a spokesman at Endo. “We’ve made no decisions and no announcements. The company is always looking at maximizing its space and making things more efficient.”

Wiggins said that Endo has acquired several companies in recent years and has “a lot of expansion going on.”

Endo has been positioning itself as a one-stop shop for pelvic health. It offers an array of diagnostic tools, medical devices and therapeutic compounds in the urology field, and has done that through a series of acquisitions. For example, Endo closed in June on a $3 billion purchase of American Medical Systems, which expands it in the urology field.

The company currently leases nearly 190,000 square feet in four buildings in Chadds Ford, according to Security and Exchange Commission documents. Those leases expire at a range of dates, the earliest next August and the last one in 2018.

At Valley Creek, the company would reportedly have a couple of buildings constructed and lease them on a long-term basis with options to expand in the future.

While some market observers are skittish that stock market gyrations and other economic turmoil could spook an Endo deal, other brokers have already started to figure in what, if any impact, Endo may have on the Route 202 Corridor office sector.

“An Endo move to the 202 Corridor is a great boost overall for the economy, however it won’t affect absorption particularly in the short run because the company will look to have buildings constructed."

“If they continue to expand further down the road and take existing space, that would affect absorption.”

“It will be a nice addition to that park and stamps it as a high-end business park in the Exton area."

However, Chadds Ford will suffer.

“That area where they are at, Route 1 and 202, is a submarket unto itself, and when they vacate that area, it will make it soft down there."

Valley Creek is owned by Rubenstein Co., a real estate firm in Philadelphia. It is a master planned corporate community on 200 acres on which 1.75 million square feet in 17 building can be constructed over several phases.

Rubenstein got its approvals in 2000 for the development but demand for new office space hasn’t warranted build out of the office park, although the first of five phases of the overall master plan has been constructed. That initial stage entailed three buildings totaling 256,981 square feet."

Thursday, August 11, 2011

FMI Leases 100,000 SF in Allentown

"FMI, a fragrance manufacturer, signed a ten-year lease for 100,000 square feet at 202-210 Cascade Dr. in Allentown, PA. Occupancy is scheduled to commence in the spring of 2012.

The one-story masonry building totals 200,000 square feet in the Lehigh Valley Industrial Park II complex. The property was delivered in 1975 and has 100 parking spaces, 40 spots for trailers, and 11 loading docks with levelators. FMI’s lease includes 100,000 square feet of industrial space with 9,000 square feet of built-out office space."

Developer Purchases Former Harley-Davidson Distribution Facility

"Panattoni Development Company, Inc. has acquired a 193,160-square-foot distribution facility from Harley-Davidson Motor Company for an undisclosed amount.

The industrial building is located in the Brickyard Industrial Park at 75 Steamboat Blvd. in Manchester, PA and was specifically constructed for Harley-Davidson in 2003. The motor company vacated the property in July 2011.

Panattoni plans to market the property for lease."

Wednesday, August 10, 2011

Forman Mills opening bigger Wilmington store, planning other new sites

Peter Van Allen

"Forman Mills will take over a vacant supermarket in Wilmington, Del. — and other new stores are planned, the company said Wednesday.

The discount clothing retailer will occupy 60,000 square feet at 4411 N. Market St., in a former SuperFresh that had been empty for seven years. A Thursday opening is planned. The store replaces a nearby location about half that size.

“This is just a bigger, better, brighter building,” said company owner Rick Forman. “People are demanding more. They want more customer service, more respect.”

Forman Mills, which is privately held and based in Pennsauken, N.J., has 28 stores, with a geographic footprint that includes Pennsylvania, New Jersey, Delaware, Michigan, New York City and the Baltimore-Washington market. It specializes in apparel, but also sells housewares, novelty items and an ever-changing line of “close-out” items from other retailers.

This month, Forman Mills will open two stores in Chicago, bringing the store count to 30. Next March, it will open a store in Cleveland, giving it a presence in eight states.

It is also refurbishing stores, including one at 48th and Market streets in West Philadelphia, where it listened to Mayor Michael Nutter’s recommendation and painted over its bright yellow exterior to blend in more with the neighborhood."

Hotel sold, may become Motel 6

"Optimum Hotel Brokerage, a regional firm active in the distressed-hotel and note-sale market, said it had brokered the bank sale of the 240-room Skyview Plaza Hotel on Penrose Avenue in Philadelphia. The buyer is a private-equity fund. "Preliminary plans indicate that it may be a Motel 6 because of its ideal location and market orientation to the economy and mid-price lodging market segment," said Joseph R. McCann, Optimum's president."

Tuesday, August 9, 2011

Five Below opens 2 stores, Stoltz buys Shoppes at Cross Keys and National Honey buys Bristol building

by Natalie Kostelni

"Five Below opens two new Philadelphia-area stores today. One is at the Warminster Towne Center at 978 W. Street Road in Warminster, and the other is at the Metroplex at 2436 Chemical Road in Plymouth Meeting.

Stoltz Real Estate Partners bought the Shoppes at Cross Keys, an upscale lifestyle center in Sicklerville, N.J., from Huntington Bank of Ohio for an undisclosed amount. The 122,637-square-foot center at the intersection of Cross Keys Highway and the Atlantic City Expressway was constructed in 2008 and opened in 2009

National Honey Almond Inc., a wholesale distributor of fine cigars, bought a new building in Bristol that will serve as its new headquarters. It bought the vacant property at 247 Rittenhouse Circle, which totals 30,000 square feet, from an institutional owner for $1.7 million. The firm will relocate its administrative office and warehouse space it leases now in Bristol later this year."

Market Trend: Philadelphia's Retail Vacancy Stays at 6.6%

"The Philadelphia retail market did not experience much change in market conditions in the second quarter 2011.

The vacancy rate went from 6.6% in the previous quarter to 6.6% in the current quarter. Net absorption was positive 454,522 square feet, and vacant sublease space increased by 171,109 square feet.

Tenants moving into large blocks of space in 2011 include: Walmart moving into 125,040 square feet at 2801 E Mark and Nordstrom moving into 122,000 square feet at Christiana Mall.

Quoted rental rates decreased from first quarter 2011 levels, ending at $14.11 per square foot per year.

A total of 15 retail buildings with 575,090 square feet of retail space were delivered to the market in the quarter, with 1,967,127 square feet still under construction at the end of the quarter.

This is compared to the U.S. national retail vacancy rate, which stayed steady at 7.1% from the previous quarter, with net absorption at postive 11.1 million square feet in the second quarter."


Friday, August 5, 2011

Waterview Apartments sell for $24M

by Natalie Kostelni

"Home Properties Inc. has expanded its regional presence and bought Waterview apartments here for $24.6 million in cash, or $121,000 a unit.

Home Properties bought the 203-unit complex fronting Route 3 at Waterview Road from Fairfield Residential Inc., which bought the property in early 2006 for $25.75 million.

Home Properties paid $1.15 million less than what Fairfield did five years ago, which is a reflection of a combination of factors. At that time, investment sale activity was marching toward its peak and prices of commercial real estate, in some cases got bid up, Mattson said.

In addition, Fairfield was eager to get into the region.

“They were aggressive and really wanted it and they paid for it,” Mattson said. “At the time, it was market.”

The property garnered a lot of investor attention this time around.

“Multifamily, in my opinion, is the number one product investors are looking at today and this had a lot of attributes that they want. It’s considered a Class B building in an A location and that submarket is the strong performing submarket in the suburbs according to my research.”

Fairfield declined comment. In spite of the multifamily market thriving during the recession, challenging credit and capital markets made it hard for the San Diego apartment owner to restructure its finances, the company said in December 2009 when it filed for Chapter 11 bankruptcy. Fairfield received an investment from Brookfield Asset Management Inc. and California State Teachers’ Retirement System and emerged from bankruptcy last August.

Waterview was constructed in 1968 and consists of 19, three-story apartment buildings totaling 161,860 square feet. The complex is 95.6 percent occupied and monthly rents average $1,000. The property also includes 6,000 square feet of retail space.

“The Philadelphia suburbs is one of our major regions,” said Charis Warshof, vice president of investor relations at Home Properties. “We’re constantly looking to acquire new properties in our various regions. It’s a natural fit.”

The last time Home Properties, based in Rochester, N.Y., bought in the Philadelphia suburbs in 2000 when it paid $136 million for six apartment complexes consisting of 2,113 units. It typically buys garden-style apartments that are older and need some upgrades, whether it’s landscaping, exterior or interior work. The company plans to spend $2.3 million on making capital improvements to Waterview.

Lancaster General targets Chesco for $15M health center

by John George

"Another health system from outside the region is looking to set up shop in the Philadelphia suburbs.

Lancaster General Health wants to build a $15 million outpatient-care center in Chester County.

The proposed two-story, 36,000-square-foot center in Sadsbury would contain an urgent-care center, provide offices for specialists and primary-care physicians and offer laboratory services, lab testing, imaging service, pulmonary testing and outpatient physical rehabilitation.

The building would be built on what is now vacant land near routes 30 and 10 near the border of Chester and Lancaster counties.

The plan received conditional approval from the Sadsbury Township supervisors Tuesday night.

“There isn’t a comparable facility like this in the immediate area,” said John Lines, a spokesman for Lancaster General. “The area close to where Lancaster and Chester meet is one of the fastest growing in the region. The population is expected to grow by 7 percent over the next five years.”

Lancaster General already has a presence in Chester County with a primary-care health clinic — called Lancaster General Health Express — it opened in a Walmart in nearby Parksburg.

The clinic is one of four Health Express sites operated by Lancaster General. Two of the others are in Giant Food Stores and the other is in a Walmart; all are in Lancaster County.

Lancaster General Health is the parent organization for Lancaster General Hospital, Lancaster Rehabilitation Hospital, and Womens and Babies Hospital. It also operates 11 outpatient centers and an urgent care center, provides home health-care services and about 30 primary-care and specialty physician offices.

“We regularly hear from residents who say they’d like quality health-care services closer to their homes and more convenient access to their physicians,” Lines said. “From our perspective, most of our areas of growth are on the outskirts of Lancaster County.”

Lines said nearly 8 percent of the inpatients treated at Lancaster General Hospital come from towns located within 15 miles of routes 30 and 10.

Mary Ann G. Holt, a partner with IMA Consulting in Chadds Ford, believes health systems expanding in peripheral territories are doing so not to engage in any kind of border war with neighboring health-care providers. Instead, she said, they are looking for ways to make stronger connections with patients and build loyalty so if those patient do require inpatient acute-care services they will stay within the same system.

“Health systems are trying to seize opportunities to improve market share,” Holt said. “If you look at a lot of the (outpatient) centers that are going up, they are really being developed to provide primary care and follow-up care. They are a way to build up a referral base.”

Getting closer to patients was also the reason Wilmington-based Christiana Care, Delaware’s largest health-care provider, paid $5 million in June to buy a two-story, 72,000-square-foot office building in Chadds Ford that it is converting into an ambulatory-care center.

The health system had decided to explore expansion options outside of its home base in Wilmington.

Gary Ferguson, Christian Care’s chief operating officer, said the health system originally planned to build the center in the north Wilmington area, but couldn’t find a suitable site.

“When nothing came about on the Delaware side, we looked at this opportunity” in Delaware County, he said, in an interview in June. “This is a new market for us.”

Ferguson said the location is ideal because it is convenient and accessible for people who live, work or shop in Delaware and are accustomed to coming to Christiana Care for health-care services. The site, near the border of Pennsylvania and Delaware, is about 15 minutes from downtown Wilmington."

Thursday, August 4, 2011

Foreclosed Industrial Complex Sells for $5.5M

"Genworth Financial, Inc. sold the foreclosed, two-building Cascade Drive Industrial Complex to MIM-Hayden Real Estate Fund for $5.5 million, or about $25 per square foot.

Located at 202 - 212 Cascade Drive in Allentown, PA, the two-building site sits on more than 14 acres and totals 219,500 square feet of rentable area. The buyer secured a long-term, 100,000-square-foot tenant before the sale transaction closed."

719,000-SF Industrial Property Sells in Milton, PA

"Cole Real Estate Investment purchased the industrial facility at 60 Industrial Park Rd. in the Milton Industrial Park in Milton, PA for $29.49 million, or about $41 per square foot, from SK Realty Management and Blue Vista Capital Partners.

The 718,910-square-foot industrial building is home to ConAgra Foods. ConAgra Foods secured a long-term lease renewal deal prior to the sale."

Blue Horizon boxing venue is set to become a hotel

"Plans to renovate the building into a hotel-restaurant kicked into high gear last week after the Corbett administration approved a $6 million state grant to redevelop the 146-year old site.

Mosaic Development Partners of West Philadelphia and Orens Brothers Real Estate have teamed up as developers.

Scott Orens, a partner in the firm, said he hoped the club would become a combination hotel and restaurant catering to Temple University, and the new Convention Center expansion, at 111 N. Broad Street.

"We are in the middle of delicate negotiations with a lot of different parties," he said Wednesday. "We think the proximity to Temple with very few hotel rooms available to visiting professors, families, and Temple students, and the overflow of conventioneers, makes it an attractive location.

"Anyone who wants to stay now at Temple has to stay in Center City somewhere," he said.

Orens said he did not know how many rooms and how much table setting the development would have. But construction could begin in six months, he said.

"This is something we've been working on for about three or four years," said Vernoca Michael, Blue Horizon president and CEO. "One of the things we wanted to do for 17 years was to preserve the facility, and not tear it down. These people [Mosaic and Orens] have put in place something that was very acceptable and workable."

The Blue Horizon occupies what had been three mansions built in 1865. The mansions were combined by the Loyal Order of the Moose into one large lodge in 1912.

In 1961, it was converted into the Blue Horizon boxing arena.

The multipurpose venue has a ballroom and auditorium. The property's three floors have hosted everything from weddings and concerts to comedy shows and trade shows, but boxing paid the bills. It hosted championship bouts for the USBA/IBF super-middleweight and IBC and NABC state titles and the Hispanic championships. Bernard Hopkins and Arturo Gatti were among the 50 fighters who fought there and went on to win world titles.

"You think of Yankee Stadium and Wrigley Field in baseball, the Blue Horizon is on par with those two legendary facilities in the boxing world," said Marc Abrams, boxing public relations director for the Blue Horizon from 2006 to last year. "I traveled all over the world covering fights and was around fighters, and when they heard I'm from Philadelphia, the first thing they asked me is if I've been to the Blue Horizon."

In 2005, Ring magazine called the Blue Horizon "the best place to watch a boxing match."

In June 2010, the Blue Horizon closed because of tax problems, CEO Michael said.

"This will be a historic building that will be preserved and redeployed to some new use," Orens said. "It would not have happened without [the grant]."

Ed Grose, executive director of the Greater Philadelphia Hotel Association, said the new hotel "will be a great addition to further develop North Broad Street."

The Blue Horizon will join a growing list of North Broad Street projects, from Lenfest Plaza next to the Pennsylvania Academy of the Fine Arts to the State Office Building at Broad and Spring Garden Streets and several new restaurants north of Spring Garden."

Wednesday, August 3, 2011

CMBS- Commercial Mortgage Backed Securities Default New High in July


Cozen O’Connor sues its landlord, OSEB

by Jeff Blumenthal

"Cozen O’Connor has sued its landlord at the 1900 Market building in Philadelphia, claiming it has breached a recently signed lease extension by failing to properly maintain the site.

Among the firm’s complaints in the lawsuit filed last week in Philadelphia Common Pleas Court are: an often malfunctioning HVAC system, elevators that frequently break down, an atrium that leaks when it rains, inadequate cleaning services and foul odors wafting from the loading dock.

The 575-lawyer Cozen was one of the initial tenants when it opened in 1981. But relations between the law firm and its landlord, OSEB Associates, have been strained. Cozen ended a two-year search for new headquarters space last summer when it decided to sign a five year extension in which the rent price was decided through arbitration. Cozen now pays less than $15.68 per square foot (or about $3.2 million per year), compared to $25.50 per square foot in the last three years of the previous lease arrangement. The firm has 203,000 square feet of space in the building.
Cozen CEO Tad Decker said the firm filed the lawsuit because it believes OSEB has breached the lease agreement. Decker said the firm is not using the lawsuit to break the lease and sign elsewhere.

“We’re just upset that certain things have not been maintained,” Decker said. “If these things are problems now, what are they going to be like four years from now? They promised the building would be maintained like a Class A building and it’s not. They have a duty to maintain it and if they don’t agree to do that, we want the lease terminated. We don’t want to move necessarily but we’re not going to stay if half the elevators don’t work.”

In the lawsuit, Cozen asks the court to declare OSEB in breach of the lease and that the firm be entitled to be released from any obligations connected it.

Decker said the firm has held talks with the Three Logan building at 1717 Arch St. but that it is exploring several options if things do not work out at 1900 Market.

OSEB could not be reached for comment.

1900 Market is a 456,922-square-foot building that has roughly 100,000 square feet of contiguous space available on the 7th and 8th floors and another large chunk, roughly 200,000 square feet. This could also come available depending on if and when Cozen O’Connor makes a leap from the building. Cozen O’Connor has been forced to be creative with its space after adding 60 lawyers from Wolf Block in 2009 to give it 250 lawyers and more than 500 people in Center City. Some lawyers have been relocated to offices in West Conshohocken and Cherry Hill, which has become increasingly popular."

Tuesday, August 2, 2011

Ecospan of Calif. opening operations center near Exton

"California-based Ecospan, which says it has developed technology for turning organic waste into clear plastics - "compostable," though not "biodegradable," under U.S. guidelines - has leased 20,000 square feet at 753 Springdale Dr. in Whitelands Park near Exton, for its East Coast operations center and research lab.

"The offices are being renovated," new low-energy lighting added, "an R&D lab will be added to the property, and eventually the balance of the building will be converted to manufacturing." Ecospan won't name its clients, who it says are electronics manufacturers.

The site is a Keystone Innovation Zone, where employers are eligible for state tax breaks and subsidies of up to $100,000 a year.

Ecospan, headed by real estate-developer-turned-electric-vehicle-promoter Greg Hoffman, will house research, design, development, testing, manufacturing, and sales staff, initially employing 12, growing to 30 by the end of next year.

Two of the company's five senior managers will also be based in Exton: marketing boss Paul Cannon, a graduate of La Salle University and Widener's M.B.A. program and a former executive at Chester County-based VWR International L.L.C.; and operations chief John Vandenbergh, a Villanova graduate and former Conair Corp. manager."

Monday, August 1, 2011

REIT CEO on the Debt Talks


Centerstone Breaks Ground on First New Construction Hotel

"The first new construction Centerstone hotel, located at 120 N. High Street, broke ground this month in downtown West Chester, Pa. The 76-room property is being erected on the site of the historic Warner (Bros.) Theatre. McFadden Hotel Group LLC of West Chester, owners of the property, along with architects Bonsal Shafferman of Bethlehem, Pa., and NorthStar Construction of Allentown, Pa., will preserve the architecture of the 1930s building to serve as the hotel facade and main lobby. Scheduled to open in May 2012, the Centerstone Hotel - Warner Theatre will be nestled among 30 restaurants and storefronts spanning three blocks and serves as the only hotel in the downtown district -- listed on the National Register of Historic places.

The Centerstone Inns, Hotels and Plaza Hotels brand was launched in May 2011 by Owner and CEO Steven Belmonte and hoteliers Neal and Cory Jackson to remove any unreasonable terms and mandates on franchisees. At present, the company has executed 8 license agreements and another 15 deals in the pipeline -- none of which involve Key West Inn property conversions also in progress. Later this month, the brand's first all-suite hotel will open in Texas.
The Centerstone Hotel - Warner Theatre will include 6,000 square feet of commercial storefront space outside the entrance on the main street. The hotel will feature an indoor pool, hot tub, fitness center, and meeting facility to accommodate approximately 80 people. The 1,500 square feet of function space can double as a catering facility. If a larger venue is needed by guests, the Historical Society, located directly across the street from the hotel, features an auditorium large enough to host groups up to 350 people. Due to the abundance of restaurants in the immediate area, no full-service eatery will be offered onsite, but a Pantry concept and Breakfast Room with buffet will be offered."
More details: http://www.thewarnerhotel.com/