Thursday, August 28, 2014

Willowbrook Apartments Sell to Home Properties

Willowbrook Group Ltd sold the 248-unit Willowbrook Apartments multifamily property at 2070 Mill Rd in Norristown, PA, to Home Properties. 

The 367,320-square-foot Class B property was built in 1972 and consists of eight two-story buildings. The complex includes 112 one- bedroom, 112 two-bedroom and 24 three-bedroom units. The new owner plans to renovate the property within three years.

Real growth in commercial real estate (Video)

Monday, August 25, 2014

Brandywine Coach Works Breaks Ground on 7.451 Acres in Exton

The sale for  build to suit of  industrial land was negotiated at the corner of
Whitford and Clover Mill Roads in Exton for $500,000.

 The Buyer is BCW Properties, LLC of Chadds Ford, PA. The Sellers is Highmount Investments, LP.
Brandywine Coach Works currently leases a facility on Whitford Road close by to this new site. The opportunity to purchase this property and expand their presence in this location was the reason for their decision to purchase this property along with the demand from consumers looking to have high quality auto body workmanship on their vehicles.

 D. Fickler Construction, LLC of Downingtown, PA is the general contractor and Bernardon
Haber Holloway are the architects who are designing and developing this site for the Buyer.
Plans for the site include a 20,000 +/- SF modern auto body repair center.

 Zoned I-2, General Industrial District in West Whiteland Township, this property is located
in the rapidly developing market area along Route 30 and the Route 30 Bypass.

Advanced Auto Parts Signs 10 Yr Lease in Doylestown

Advanced Auto Parts opened at Bailey’s Square on August 14th. This is  a newly constructed retail shopping center development located at the traffic-lit intersection of Swamp Road (Route 313) and Ferry Road in the Doylestown, PA.
Advance Stores Company, Incorporated (Advance Auto Parts), which  opened on August 14th, signed a 10 year lease valued at $1.4 million dollars for 7,000 sq. ft. of retail space at Bailey’s Square, where it occupies the anchor position and is the first tenant to open for business. Richard Soloff of SRD represented Bailey’s Square LLC in this leasing transaction, and Drexel Realty Group, Inc. represented the Tenant. 
Advance Auto Parts, which is headquartered in Roanoke, Virgina, operates 5,276 stores under the Advance Auto brand across 49 states, Puerto Rico and Canada. The company is the largest provider of aftermarket automotive parts for the enthusiastic layperson, professional mechanics and installers.

Newark's Main Street, The Hottest Submarket in DE

In recent months several sale and lease transactions have taken place in Newark, Delaware’s Main Street area – the hottest submarket in Delaware.

Main Street has always been a hot spot for retailers, as it is set in the heart of the 21,000-student University of Delaware campus. The food industry is the common factor in these deals. Demographics in the Main Street area show that food and alcohol consumer spending totals are upwards of $25 million per year in a one-mile radius, and close to $160 million per year in a three-mile radius.

Recent Main Street Transactions include:
- Insomnia Cookies leased 1,200 +/- SF space at 74 E Main Street. The tenant is a Pennsylvania based, round-the-clock dessert company.

- Hakuna Hospitality Group leased 4,100 +/- SF lease transaction at 76 E Main Stree. The landlord was Fratelli Enterprises, Inc. The tenant, doing business as Del Pez Sea Mex, brings a seafood flare to Main Street as it focuses on coastal-inspired Mexican cuisine.

- Main Street Burritos LLC, signed a ten-year lease of a 2100 +/-SF space at 127 E Main Street. The company, publically known as El Diablo Burritos, is Wilmington based and currently operates at locations in Wilmington’s Trolley Square and North Wilmington’s Branmar Plaza. The decision to expand in the appropriately related market stems from the company’s current success and the growing popularity of Mexican fast-casual restaurants.

- A block away was the sale at 115 East Main Street, for $1.35 million for 3,400 +/- SF commercial condominium unit. The buyer, Mainline Enterprises, LLC purchased the property from LGLB, Inc. in a sale-leaseback investment opportunity, which settled in May 2014. The condo unit houses a restaurant currently doing business as 16 Mile Taphouse. The restaurant is a partner to Georgetown’s 16 Mile Brewing Company and boasts an impressive ensemble of craft beers and award-winning wines.

- Most recently, Colorful Yun Nan, Inc., signed a ten-year lease of a 2,911 +/- SF space at 59 East Main Street. The space will be used as an Asian style restaurant.

Thursday, August 21, 2014

Time's right for big commercial real estate gains? (Video)

Willowbrook Apartments Sell to Home Properties

Willowbrook Group Ltd sold the 248-unit Willowbrook Apartments multifamily property at 2070 Mill Rd in Norristown, PA, to Home Properties.

The 367,320-square-foot Class B property was built in 1972 and consists of eight two-story buildings. The complex includes 112 one- bedroom, 112 two-bedroom and 24 three-bedroom units. The new owner plans to renovate the property within three years.

AquaFence: The Flood Barrier for $10B in Protecting Your Real Estate (Video)

Tuesday, August 19, 2014

Glazer lays out Conshy office, hotel, bar, parking

by Joseph N. DiStefano, Philadelphia Inquirer
Bill Glazer's Keystone Property Group, best known before now as a buyer and renovator of aging office buildings in Philadelphia and its suburbs, has unveiled a new plan for One Conshohocken, a redevelopment scheme including a public plaza, a 300,000 sq. ft. office building, a 200-room hotel, and shops and restaurant space, including conversion of the 136-year-old firehouse as a bar.

No tenants or hotel have been signed to date, Glazer's spokesman told me. Conshohocken plans to review the proposal at a borough meeting Wednesday night.

One Conshohocken is also designed to include 300 free parking spaces. The project is close to Conshocken's Septa station (Philadelphia-Norristown train line) and the crowded Schuylkill Expressway (I-76). The borough and the Montgomery County Redevelopment Authority picked Glazer's company to redevelop the site last year. The town, formerly an industrial center, has attracted offices and apartments over the past 20 years as a suburban alternative to Center City Philadelphia.


Airbnb: The Hotel Disruptor Unconstrained by Real Estate

Monday, August 18, 2014

Hidden Forest Apartments Sells for $21M

Hidden Forest Apartments, 602 Hidden Forest Ct., Fairless Hills, PA, was been sold to a private Investor by TGM Associates for $21,300,000, or $89,496 per unit.

“This property attracted strong interest from New York investors because of its ideal location near I-95 and the Pennsylvania Turnpike in Bucks County. Investors saw strong rental upside, as the property enjoyed 98% occupancy,” says Miller. “Fully renovated more than ten years ago, the property was much younger than its 1967 construction date.  Furthermore, the property was in excellent condition as it was institutionally managed by TGM.”

3 Leases Completed in the Colwick Business Center

Three lease transactions were completed in the Colwick Business Center.
Colwick Business Center features three single story office buildings owned and managed by an affiliate entity of Endurance Real Estate Group LLC.

·         7,994 square feet of office space to South Jersey Behavioral Health Resources Inc.
·          2,600 square feet to MorphoTrust Usa Inc. 
·          12,604 square feet to QMA, Inc. 
These new tenants will join The Philadelphia Inquirer, The Internal Revenue Service, andUrban Engineers, among others. Available remaining suites range in size from 15,025 to 51,853 square feet (divisible). The largest contiguous block of vacant space at 55 Haddonfield Road, is one of a very few premier vacancies over 50,000 SF in the area.

Endurance acquired Colwick Business Center last summer and made a major investment in improvements, recently completing exterior upgrades and securing NJ Transit bus service through the office park. The office complex features highly efficient suite layouts, private 24/7 access to each tenant suite, no loss factor, and ample parking. Ownership has committed to making substantial base building improvements and restored Colwick to its class-A campus environment and prestige.
“In the competitive Camden County leasing environment, we are excited to have executed on our business plan by absorbing 23,000 square-feet of office space in less than 12 months. We are pleased with the level of deal momentum and are optimistic about our pending activity,” says Benjamin Cohen, president of Endurance Real Estate Group.

Colwick Business Center is located just west of the Cherry Hill Mall on a stretch of Haddonfield Road that has recently undergone a massive redevelopment renaissance. The area features affluent residential communities, retail centers, hotels, and other amenities attractive to office tenants. The mall has been completely overhauled in the last few years, with the opening of Nordstrom and many other high end retail stores and restaurants such as The Capital Grille. There is currently a Super Wawa under construction in the immediate vicinity, which will further expand the retail corridor.

Saturday, August 16, 2014

Michael Baker International Relocates in Allentown

Michael Baker International committed to a long-term lease in the new Two City Center Class A office tower at 645 West Hamilton St. in Allentown.

Baker’s new space in the heart of the downtown PPL Center arena block efficiently accommodates current engineering and construction services staff as well as anticipated growth.

“With this move to Two City Center, Baker gains an office identity that reflects our strong Pennsylvania presence,” said Ralph Eberhardt, P.E., office manager in Baker’s Pennsylvania Construction Services practice. “Geographically, our new downtown office will reaffirm and optimize our existing client relationships and confirm Baker’s commitment to the ongoing redevelopment efforts.”

Philadelphia Industrial Deliveries, Construction and Inventory

During the second quarter 2014, eight industrial buildings totaling 3,127,992 square feet were completed in the Philadelphia market area. This compares to three buildings totaling 214,056 square feet that were completed in the first quarter 2014.

There was 8,276,767 square feet of Industrial space under construction at the end of the second quarter 2014.

Some of the notable 2014 deliveries include: 9645 West Hills Ct, a 980,000-square-foot facility that delivered in second quarter 2014 and is now 100% occupied, and 30 Martha Dr, a 906,919-square-foot building that delivered in second quarter 2014 and is now 100% occupied.

The largest projects underway at the end of second quarter 2014 were Liberty at Shippensburg on Olde Scotland Rd, a 1,700,000-square-foot building with 100% of its space pre-leased, and 3215 Commerce Center Dr, a 1,644,450-square-foot facility that is 100% pre-leased.

Total Industrial inventory in the Philadelphia market area amounted to 1,021,212,845 square feet in 20,149 buildings as of the end of the second quarter 2014. The Flex sector consisted of 84,692,787 square feet in 3,265 projects. Within the Industrial market there were 2,617 owner-occupied buildings accounting for 239,826,483 square feet of Industrial space.

This trend is compared to U.S. National Industrial deliveries and construction, which saw 229 buildings totaling 28.56 million square feet complete construction, with an additional 119.7 million square feet of industrial space still under construction at the end of the second quarter. The 2.1 million-square-foot 4500 S. Dobson Rd. delivered in the Phoenix market, while the 1.8 million-square-foot D1X Mod 2 building was still underway in the Portland market. Total industrial inventory in the U.S. market totaled 20.96 billion square feet in more than 618,000 buildings at the end of the second quarter 2014, including more than 69,000 owner-occupied projects.

Thursday, August 14, 2014

West Chester Office Sold for $4.6M

RedGo Development sold the office building at 1055 Andrew Dr. in West Chester, PA to a private investor for $4.6 million, or about $169 per square foot.

The single-story, 27,180-square-foot property was built in 2003 on two-thirds of an acre in the West Chester submarket of Philadelphia. The asset was fully leased at the time of sale

Tuesday, August 12, 2014

Philadelphia Office Deliveries, Construction and Inventory

During the second quarter 2014, seven office buildings totaling 413,734 square feet were completed in the Philadelphia market area. This compares to four buildings totaling 121,952 square feet that were completed in the first quarter 2014.

There was 2,116,720 square feet of office space under construction at the end of the second quarter 2014.

Some of the notable 2014 deliveries include: Two City Center, a 296,025-square-foot facility that delivered in second quarter 2014 and is now 40% occupied, and 1401 Roosevelt Ave, a 60,000-square-foot building that delivered in first quarter 2014 and is now 100% occupied.

The largest projects underway at the end of second quarter 2014 were FMC Tower / Walnut Street Tower, an 830,000-square-foot building with 68% of its space pre-leased, and 3737 Market St, a 340,000-square-foot facility that is 82% pre-leased.

Total office inventory in the Philadelphia market area amounted to 401,999,668 square feet in 20,835 buildings as of the end of the second quarter 2014. The Class-A office sector consisted of 128,991,730 square feet in 955 projects. Within the Office market there were 942 owner-occupied buildings accounting for 35,997,940 square feet of office space.

This trend is compared to U.S. National Office deliveries and construction, which saw 217 buildings totaling 11.38 million square feet complete construction, with an additional 101 million square feet of office space still under construction at the end of the second quarter. 3905 NW 107th Ave., an 80,000-square-foot facility delivered in the South Florida market, while the 354,845-square-foot 520 Newport Center Dr. in the Orange County market is still underway. Total office inventory in the U.S. market totaled almost 10.42 billion square feet in more than 500,800 buildings at the end of Q2 2014, including some 20,800 owner-occupied buildings accounting for 905 million square feet.

Monthly Economic Outlook – August 2014 (Video)- Wells Fargo

Monday, August 11, 2014

REITs on the rise (Video)

Landlords, beware of Utility Liens from Deadbeat Tenants

3 landlords sue PGW over collection tactic by Andrew Maykuth, Inquirer Staff Writer
Three landlords have sued Philadelphia Gas Works over the municipal utility's practice of dunning property owners for unpaid energy bills accrued by deadbeat tenants.

The landlords allege PGW slapped liens on their properties with little or no notification, in some cases years after tenants left, forcing the property owners to pay for debts over which they had no control.
"It's not just that they're taking your money," said David Wolf, an industrial real estate owner who is one of the plaintiffs. "They're belligerently stealing your money. It's outrageous."

The federal suit filed last month in Philadelphia alleges PGW's method of filing liens violates due process. The plaintiffs are seeking class-action status, saying the city has filed more than 50,000 liens against property owners who were not the customers responsible for the underlying gas bills.

The lawsuit, filed by attorneys Irv Ackelsberg and John J. Grogan of Langer, Grogan & Diver, is the latest salvo in a long-running battle between property owners and PGW over the utility's collection methods.
Unlike investor-owned utilities, PGW as a municipal government agency has the power to place liens against properties to collect debts. Liens are legal encumbrances that must be settled when real estate is transferred or sold.

Critics say PGW is too quick to resort to liens rather than more laborious collection tactics. They say the utility makes an insufficient effort to curtail gas use for nonpaying customers, allowing deadbeats to run up bills PGW knows it can ultimately collect from the property owners.
The Philadelphia Gas Commission estimates PGW has placed 90,000 liens worth about $126 million - some properties have more than one lien. The utility says it has not estimated the number of liens filed against landlords.

PGW declined to comment on the lawsuit. Last year, Doug Oliver, the utility's senior vice president of marketing and corporate communications, told 6ABC News that if property owners did not pay, the arrearages would have to be paid by PGW's other customers.
"They are part of the equation, whether they signed up for it or not," Oliver said. "It is one of the things that comes along with doing business."

PGW was long considered a soft touch, and in the 1980s and '90s, it amassed huge amounts of bad debts on its books. In the last decade, it has applied "more rigor and more discipline" to its collection methods, said spokesman Barry O'Sullivan, including more aggressive use of liens.

The suit does not challenge the validity of liens as a collection tool - the city's power has survived previous court challenges. But it alleges that PGW fails to notify landlords in a timely fashion that they are at risk from a delinquent tenant.

"A fundamental requirement of due process is the opportunity to be heard at a meaningful time and in a meaningful manner," the suit says.

PGW typically refers complaining landlords to the Pennsylvania Public Utility Commission, though the PUC invariably dismisses the complaints because it lacks jurisdiction to address the validity and enforcement of liens.

Friday, August 8, 2014

Christina Mill Sells for $30.3M

Korman Residential Properties, Inc. sold the 228-unit Christina Mill apartment community at 100 Christina Mill in Newark, DE to Lowe Enterprises Investors for $30.25 million, or roughly $133,000 per unit. 

The 193,572-square-foot multifamily property consists of 14 buildings with a total of 190 one-bedroom and 38 two-bedroom units. The property was constructed in 1992 on 18.5 acres in New Castle County.

Developers Start $22M Project in Chester County, PA

by John Mugford, Editor, Healthcare Real Estate Insights

Creating “medical destinations” where patients can receive a variety of outpatient services in a “one-stop shop” continues to be a valuable, important strategy for providers looking to expand their brands in today’s ultra-competitive healthcare environment.
As the population continues to grow in Chester County in southeastern Pennsylvania, two firms well-known in the healthcare real estate (HRE) sector are embarking on a project they expect will help attract patients to a major healthcare system looking to expand its market share in the area.
The firms are Wilmington, DE-based Anchor Health Properties and White Plains, NY-based Seavest Healthcare Properties LLC. The two are teaming up on the development of the 72,000 square foot, $22 million Jennersville Medical Office Building (MOB) on a highly visible 45-acre site at Pennsylvania Routes 1 and 796. The site is about 40 miles west of Philadelphia and 17 miles northwest of Wilmington.
Anchoring the MOB will be physicians and services of the 220-bed Penn Medicine Chester County Hospital, located about 20 miles to the east in West Chester, PA. The hospital recently became part of Philadelphia-based University of Pennsylvania Health System, otherwise known as Penn Medicine.
The formerly independent Chester County Hospital originally planned the facility with Anchor Health Properties. It was after the planning was initiated that the hospital became part of Penn Medicine, says Jonathan L. “John” Winer, executive VP of Seavest.
According to Anchor Health Properties, the goal of the project is to create a “one-stop shop” complete with an outpatient surgery center as well as new, expanded and consolidated services. The architect is ARRAY Architects of King of Prussia, PA, and the construction manager is The Norwood Co. of Malvern, PA.
Physicians and groups that are part of Penn Medicine and Chester County Hospital will occupy about 80 percent of the building, with the remaining space being 100 percent pre-leased to other local practices, Winer says.
“It is a growing area and for Penn Medicine Chester County it is a project that will allow it to cement its presence there – there were some other systems looking at developing footholds in the area as well,” Winer says. “And as for the site itself, it is highly visible along a major roadway there, Route 1, and it will really enhance the brand for Penn Medicine and Chester County Hospital in that area.”
The facility is scheduled to open in spring 2015, and because of the size of the site – 45 acres – there is a possibility that other projects could follow if demand warrants.
“Nothing is on the drawing board yet,” Winer says.
While Seavest has formed numerous joint ventures on projects nationwide, the Chester County facility marks the first time it has worked with Anchor, Winer says. The two firms, however, plan to team up on more projects in the future.

Thursday, August 7, 2014

Accidental landlords (Video)

As my friend once said, "Everyone should own a rental property at least once in their life. It is character

Planet Fitness to Anchor Pennsbury Plaza

Abrams Realty & Development (ARD) purchased the Pennsbury Plaza at 223-229 Plaza Blvd. in Morrisville, PA from Pennsbury Associates III for $5.1 million, or about $71 per square foot.

The 72,000-square-foot shopping plaza is currently being renovated. Sears, the previous anchor tenant, recently vacated the property. The new owners will have Planet Fitness fill 22,000 square feet there, and expects to be fully operational by the fourth quarter of 2014.

National Investor Acquires Taylor Manufacturing Plant

Centurion Investments LLC acquired the industrial building at 14 Kane Ln. in Taylor, PA from Kane Warehousing, Inc. for $6 million, or about $80 per square foot. 

The 75,271-square-foot manufacturing building sits on 38 acres in the I-81 Corridor Industrial submarket of Lackawanna County. Distribution Center 8 is part of the Stauffer Industrial Park, and is fully occupied by a single tenant, Sanofi.

Monday, August 4, 2014

Keystone Closes on Fair Lawn Office Building Deal

by John Jordan,
In a deal that is part of the previously announced portfolio acquisition between the two firms, a joint venture led by Keystone Property Group reports it has closed on the acquisition of 17-17 Route 208 here from Mack-Cali Realty Corp. for $12.5 million

The two companies announced earlier this year they would form joint ventures to acquire the portfolio of several office properties that Mack-Cali owns throughout Northern New Jersey, New York, and Connecticut.

The 17-17 Route 208 North property is a three-story, 150,477-square-foot class A office building with underground executive parking for 114 cars and surface parking. Balla Cynwyd, PA-based Keystone says it will invest in enhancements to the building's common area hallways, bathrooms and amenities, including an on-site cafeteria.

"In line with our strategy to create value through reinvestment, we look forward to executing on our plans to enhance 17-17 Route 208 North by making upgrades to the building's common areas," says Bill Glazer, president of Keystone Property Group. "The property's desirable Bergen County location, with direct access to a robust highway network, positions it strongly in the regional market among quality tenants."

Earlier this year, Keystone closed on four other New Jersey commercial properties as part of the company's portfolio deal with Mack-Cali, including 412 Mt. Kemble Avenue in Morris Township, 30 Knightsbridge Road in Piscataway, 470 Chestnut Ridge Road in Woodcliff Lake, and 530 Chestnut Ridge Road in Woodcliff Lake. Keystone reports it will reinvest in the properties through redevelopment, management and upgrades to each site. Through its partnership with Keystone, Mack-Cali will participate in value creation above certain hurdle rates, handle leasing of the portfolio, as well as share in management fees, company officials state.

Mitchell E. Hersh, president and CEO of Mack-Cali, says, "The reinvestment strategy in place for 17-17 Route 208 North will enable the partnership to both retain and attract high-caliber tenants as we capitalize on the building's prime location and space opportunities. We are pleased to be closing on this transaction, as we continue to identify new avenues for growth through strategic investment."

Philadelphia Retail Vacancy Decreases to 5.9%

The Philadelphia retail market did not experience much change in market conditions in the second quarter 2014.

The vacancy rate went from 6.0% in the previous quarter to 5.9% in the current quarter. Net absorption was positive 551,992 square feet, and vacant sublease space decreased by 20,121 square feet. In first quarter 2014, net absorption was positive 979,455 square feet.

Tenants moving into large blocks of space in 2014 include: ShopRite moving into 90,000 square feet at 1817 Mount Holly Rd; Giant Food moving into 66,472 square feet at 852 E Main St; and Acme moving into 58,785 square feet at 21-31 W Ridge Pike.

Quoted rental rates increased from first quarter 2014 levels, ending at $14.05 per square foot per year.

A total of 8 retail buildings with 66,506 square feet of retail space were delivered to the market in the quarter, with 203,783 square feet still under construction at the end of the quarter.

This trend is compared to the U.S. National Retail vacancy rate, which decreased to 6.4% from the previous quarter, with net absorption positive 23.39 million square feet in the second quarter. Average rental rates increased to $14.81, and 522 retail buildings delivered to the market totaling more than 10.8 million square feet.

FCP Provides $20M Mezz Loan for Downtown Development

Federal Capital Partners (FCP) provided $20 million in mezzanine financing for Dalian Development, allowing the company to move ahead with plans to break ground this fall on the Dalian on Fairmount, a proposed 293-unit multifamily building to be constructed in Philadelphia's museum district.

Property Capital LLC arranged the mezzanine financing for the borrower. Dalian will lead development and construction of the project, with Neil Rodin as developer and MV+A Architects of Bethesda, MD as architect.

The property will be located above the future Whole Foods, a 55,000-square-foot grocery store coming to Rodin Square. Currently a Best Western, the redevelopment project is expected to top $130 million, with most of those funds provided by Spanish bank Santander.

When completed, tenants at the nine-story trophy asset will be within walking distance to the Philadelphia Museum of Art, the Barnes Foundation, the Free Library, and Fairmont Park in Center City. The building will feature a second-story lobby, a 35,000-square-foot "Sky Park" outdoor amenity space, garage parking, and sweeping downtown views.