Mack-Cali leased about 40,000 square feet at its office and office/flex commercial real estate properties in Southern New Jersey during the third quarter.
Highlights of the third quarter transactions include:
EVO Merchant Services, LLC, a payments service provider, renewed its lease for 19,200 square feet at 102 Commerce Drive in Moorestown, NJ. Located in Moorestown West Corporate Center, the 38,400-square-foot office/flex building is 100 percent leased.
Tricomm Services Corporation, an IT technology service provider, is relocating within the building to 12,000 square feet at 1247 North Church Street, also in Moorestown. The transaction represents an expansion of 7,200 square feet and an extension of 4,800 square feet. Also located in Moorestown West Corporate Center, the 52,790-square-foot office/flex building is 86.7 percent leased.
SCSK, a subsidiary of Sumisho Computer Systems Corporation, a Japanese IT services company, signed a new 9,600-square-foot lease at 3 Terri Lane in Burlington Township, NJ. Located in Bromley Commons, the 64,500-square-foot office/flex building is 100 percent leased.
www.omegare.com
Friday, October 31, 2014
Thursday, October 30, 2014
Wednesday, October 29, 2014
Kahns Sells Montgomeryville Retail, Land for $3.5M
Chick-Fil-A, Inc. acquired the retail building and adjacent lot at 794-798 Bethlehem Pike in Montgomeryville, PA from Kahns, Inc. for $3.5 million.
Included in the sale was a 22,050-square-foot, freestanding retail building on 1.9 acres in the Ft Washington / Spring House submarket of Montgomery County, and the adjacent 0.64-acre vacant lot - a pad site for the Route 309 Mall.
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Included in the sale was a 22,050-square-foot, freestanding retail building on 1.9 acres in the Ft Washington / Spring House submarket of Montgomery County, and the adjacent 0.64-acre vacant lot - a pad site for the Route 309 Mall.
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Newly Renovated Auburn Station Sold for $10.6M
Moshe Weiss acquired the 85-unit Auburn Station at 375 Auburn St. in Allentown, PA from Auburn Realty Corp. for $10.55 million. Included in the sale was additional land that could hold an additional 49 units.
The 90,330-square-foot, loft-style, multifamily property was originally built in the early 1900's. When originally built the property only offered 40 units. Prior to selling the property was fully gutted and renovated. The renovation was completed in June of this year and more than doubled the available units. At the time of sale the property was 95 percent occupied.
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The 90,330-square-foot, loft-style, multifamily property was originally built in the early 1900's. When originally built the property only offered 40 units. Prior to selling the property was fully gutted and renovated. The renovation was completed in June of this year and more than doubled the available units. At the time of sale the property was 95 percent occupied.
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Predictions for Center City office market: Dark clouds for landlords
Philadelphia Business Journal
For any tenant looking to lease Class A office space in Center City Philadelphia today, they are encountering something they haven't seen in quite some time: a landlord's market. While there are still some buildings experiencing softness, many of the higher end towers are at near record occupancy levels and, therefore, commanding much higher rents than we saw in 2008-2010. The good news for tenants? Over the next three years, several scenarios are playing out which could very likely throw the Center City market into a tailspin.
Here are 10 scenarios which, individually and in the aggregate, could put significant downward pressure on Center City rents by 2017:
1. In mid 2016, FMC Tower at Cira Centre South will open with about 200,000sf of speculative office space. Unless this space is leased by new tenants in the market or new demand from growing tenants in the city, this space will likely create net vacancy in the Center City market.
2. Comcast's new Innovation and Technology Center is slated to open in 2017. Until then, Comcast has been accommodating its growth by leasing up short term space around the city. Comcast will soon have close to 500,000sf of office space in the city outside of Comcast Center. If a good portion of this Comcast space consolidates into the new tower in 2017, it will create significant vacancy in the city's Class A market.
3. FMC (200,000sf), Sunoco (200,000sf) and Bank of New York/Mellon (180,000sf) have all announced that they are either vacating Mellon Bank Center (FMC and Sunoco) or significantly downsizing (BNY Mellon). With close to 500,000sf of vacancy in Mellon Bank Center by 2017, this will create downward pressure on rents.
4. Cigna recently announced that it is downsizing its Center City presence by close to 150,000-200,000sf and may decide to vacate Two Liberty all together. In addition, the Two Liberty owners recently changed their mind about converting the top of the tower into a hotel (the planned condos haven't been selling well). If the owners decide to convert this space back to its original office use, this increase in inventory will drive down rents in other trophy towers and Class A buildings.
5. One Franklin Plaza, which was vacated by GlaxoSmithKline last year, has still not come back onto the market. Unless all of this building is repurposed for university, health care system, apartments and/or hotel, it could provide another option for office tenants. To date, Center City landlords have been spared any negative impact from Glaxo's move to the Navy Yard. When the company moved, it freed up over 800,000sf of office space in the CBD which many landlords feared would put significant downward pressure on rents. However, Three Franklin Plaza (200,000sf) was quickly purchased by a new performing arts charter school and One Franklin Plaza (600,000sf+) remains in limbo while the owner, Commonwealth REIT, figures out what to do with it. If One Franklin Plaza comes back into the office building inventory, especially if it is renovated and upgraded, it could change the landscape for office rents.
6. 1900 Market Street will soon have close to 300,000sf of vacancy when Cozen O'Connor vacates in 2015. The owner, Brandywine Realty Trust, will deal with this vacancy carefully as it could negatively impact the value (and rental rates) of its remaining and substantial Center City portfolio. As the largest property owner in the city, no one is more aware of the pending threats to the office market than they are.
7. The trends in corporate space utilization continue to go in the wrong direction for landlords. Companies are consuming less and less square feet per employee and corporate America hasn't even truly embraced hoteling or telecommuting in a big way yet. These emerging trends could transform office demand across the globe. Glaxo went from close to 300sf/employee to less than 150sf/employee when it moved to the Navy Yard. And virtually every large law firm in the city has given back one or two floors of space as their leases have expired over the past three years. As general demand continues to shrink, rents should drop.
8. Two important trends have saved Center City landlords over the past five years: (1) office buildings have been converted into apartments at a dizzying pace thereby reducing total office supply and (2) health care systems and universities have been leasing up center city office space to free up "on campus" space for core business uses. These two trends may both be coming to an end. Recent reports show that apartment rent growth is slowing in the region with a large number of new units still in the pipeline. If the multi-family bubble bursts and conversions are no longer economically viable, the office inventory will stabilize. Drexel is planning an Innovation neighborhood in University City. When development proceeds, Drexel may bring their folks back near campus freeing up office space in the CBD. If Innovation Neighborhood takes off, it could draw other Center City tenants West of the Schuylkill.
Full story: http://tinyurl.com/q3fmlfk
www.omegare.com
For any tenant looking to lease Class A office space in Center City Philadelphia today, they are encountering something they haven't seen in quite some time: a landlord's market. While there are still some buildings experiencing softness, many of the higher end towers are at near record occupancy levels and, therefore, commanding much higher rents than we saw in 2008-2010. The good news for tenants? Over the next three years, several scenarios are playing out which could very likely throw the Center City market into a tailspin.
Here are 10 scenarios which, individually and in the aggregate, could put significant downward pressure on Center City rents by 2017:
1. In mid 2016, FMC Tower at Cira Centre South will open with about 200,000sf of speculative office space. Unless this space is leased by new tenants in the market or new demand from growing tenants in the city, this space will likely create net vacancy in the Center City market.
2. Comcast's new Innovation and Technology Center is slated to open in 2017. Until then, Comcast has been accommodating its growth by leasing up short term space around the city. Comcast will soon have close to 500,000sf of office space in the city outside of Comcast Center. If a good portion of this Comcast space consolidates into the new tower in 2017, it will create significant vacancy in the city's Class A market.
3. FMC (200,000sf), Sunoco (200,000sf) and Bank of New York/Mellon (180,000sf) have all announced that they are either vacating Mellon Bank Center (FMC and Sunoco) or significantly downsizing (BNY Mellon). With close to 500,000sf of vacancy in Mellon Bank Center by 2017, this will create downward pressure on rents.
4. Cigna recently announced that it is downsizing its Center City presence by close to 150,000-200,000sf and may decide to vacate Two Liberty all together. In addition, the Two Liberty owners recently changed their mind about converting the top of the tower into a hotel (the planned condos haven't been selling well). If the owners decide to convert this space back to its original office use, this increase in inventory will drive down rents in other trophy towers and Class A buildings.
5. One Franklin Plaza, which was vacated by GlaxoSmithKline last year, has still not come back onto the market. Unless all of this building is repurposed for university, health care system, apartments and/or hotel, it could provide another option for office tenants. To date, Center City landlords have been spared any negative impact from Glaxo's move to the Navy Yard. When the company moved, it freed up over 800,000sf of office space in the CBD which many landlords feared would put significant downward pressure on rents. However, Three Franklin Plaza (200,000sf) was quickly purchased by a new performing arts charter school and One Franklin Plaza (600,000sf+) remains in limbo while the owner, Commonwealth REIT, figures out what to do with it. If One Franklin Plaza comes back into the office building inventory, especially if it is renovated and upgraded, it could change the landscape for office rents.
6. 1900 Market Street will soon have close to 300,000sf of vacancy when Cozen O'Connor vacates in 2015. The owner, Brandywine Realty Trust, will deal with this vacancy carefully as it could negatively impact the value (and rental rates) of its remaining and substantial Center City portfolio. As the largest property owner in the city, no one is more aware of the pending threats to the office market than they are.
7. The trends in corporate space utilization continue to go in the wrong direction for landlords. Companies are consuming less and less square feet per employee and corporate America hasn't even truly embraced hoteling or telecommuting in a big way yet. These emerging trends could transform office demand across the globe. Glaxo went from close to 300sf/employee to less than 150sf/employee when it moved to the Navy Yard. And virtually every large law firm in the city has given back one or two floors of space as their leases have expired over the past three years. As general demand continues to shrink, rents should drop.
8. Two important trends have saved Center City landlords over the past five years: (1) office buildings have been converted into apartments at a dizzying pace thereby reducing total office supply and (2) health care systems and universities have been leasing up center city office space to free up "on campus" space for core business uses. These two trends may both be coming to an end. Recent reports show that apartment rent growth is slowing in the region with a large number of new units still in the pipeline. If the multi-family bubble bursts and conversions are no longer economically viable, the office inventory will stabilize. Drexel is planning an Innovation neighborhood in University City. When development proceeds, Drexel may bring their folks back near campus freeing up office space in the CBD. If Innovation Neighborhood takes off, it could draw other Center City tenants West of the Schuylkill.
Full story: http://tinyurl.com/q3fmlfk
www.omegare.com
Tuesday, October 28, 2014
Clarion and MRP To Develop 1.5 Million Square Foot Gateway Logistics Park
by Steve Lubetkin GlobeSt.com
Real estate investment manager Clarion Partners and MRP Industrial, the industrial real estate affiliate of MRP Realty, have acquired the former I-81/I-78 Logistics Park, a planned 129-acre, two-building, 1,502,000 square foot class A industrial center in Union Township, Lebanon County, PA. The development, which will now be named Gateway Logistics Park, includes pad-in-place development parcels for both a 1,002,000 square foot and 500,000 square foot distribution center.
"Clarion is very excited to be partnered with MRP Industrial on the acquisition and development of this project in Central Pennsylvania. With the market’s supply constraints we feel we are well positioned to capture build-to-suit opportunities or build spec inventory,” says Andy Sitzer, senior vice president with Clarion Partners. “This will be the third project the two companies have joined forces; the others are Fulling Mill Road in Harrisburg and Burlington Industrial Park in Burlington, NJ.”
“This acquisition addresses the surging demand for modern, bulk distribution centers with the ability to service the entire Northeast region from a single facility,” says D. Reid Townsend, principal with Baltimore-based MRP Industrial. “Over the past 12 months, the Central Pennsylvania market has experienced nearly eight million square feet of new absorption, with a steady pipeline of new tenants entering the market. The park’s visibility, access and amenities will be an attractive option for a wide range of future distribution requirements.”
Gateway Logistics Park is located at the intersection of Interstate 81 and Interstate 78. The development will provide prominent interstate visibility and convenient access to the region’s major metropolitan areas of New York, Philadelphia, Baltimore and Washington DC, all located within 150 miles. The property is also located within 30 miles of FedEx Ground, FedEx Freight and UPS distribution hubs, responding to the growing trend of direct-to-consumer fulfillment requirements for the retail market. MRP Industrial, in partnership with Clarion Partners, has completed building design and is evaluating both build-to-suit and speculative development opportunities.
In early 2014, the property was approved into the Commonwealth’s Local Economic Revitalization Tax Assistance (LERTA) program, providing future tenants with partial real estate tax relief during the initial ten years of occupancy. When fully developed, Gateway Logistics Park is projected to support over 1,000 new, full time jobs in Lebanon County and provide an immediate boost to support the Union Township, Lebanon County and Northern Lebanon School District operating budgets.
www.omegare.com
Real estate investment manager Clarion Partners and MRP Industrial, the industrial real estate affiliate of MRP Realty, have acquired the former I-81/I-78 Logistics Park, a planned 129-acre, two-building, 1,502,000 square foot class A industrial center in Union Township, Lebanon County, PA. The development, which will now be named Gateway Logistics Park, includes pad-in-place development parcels for both a 1,002,000 square foot and 500,000 square foot distribution center.
"Clarion is very excited to be partnered with MRP Industrial on the acquisition and development of this project in Central Pennsylvania. With the market’s supply constraints we feel we are well positioned to capture build-to-suit opportunities or build spec inventory,” says Andy Sitzer, senior vice president with Clarion Partners. “This will be the third project the two companies have joined forces; the others are Fulling Mill Road in Harrisburg and Burlington Industrial Park in Burlington, NJ.”
“This acquisition addresses the surging demand for modern, bulk distribution centers with the ability to service the entire Northeast region from a single facility,” says D. Reid Townsend, principal with Baltimore-based MRP Industrial. “Over the past 12 months, the Central Pennsylvania market has experienced nearly eight million square feet of new absorption, with a steady pipeline of new tenants entering the market. The park’s visibility, access and amenities will be an attractive option for a wide range of future distribution requirements.”
Gateway Logistics Park is located at the intersection of Interstate 81 and Interstate 78. The development will provide prominent interstate visibility and convenient access to the region’s major metropolitan areas of New York, Philadelphia, Baltimore and Washington DC, all located within 150 miles. The property is also located within 30 miles of FedEx Ground, FedEx Freight and UPS distribution hubs, responding to the growing trend of direct-to-consumer fulfillment requirements for the retail market. MRP Industrial, in partnership with Clarion Partners, has completed building design and is evaluating both build-to-suit and speculative development opportunities.
In early 2014, the property was approved into the Commonwealth’s Local Economic Revitalization Tax Assistance (LERTA) program, providing future tenants with partial real estate tax relief during the initial ten years of occupancy. When fully developed, Gateway Logistics Park is projected to support over 1,000 new, full time jobs in Lebanon County and provide an immediate boost to support the Union Township, Lebanon County and Northern Lebanon School District operating budgets.
www.omegare.com
Brandywine, LCOR Team Up For Center City High-Rise
A 29-story, 455,000-square-foot residential glass tower will serve as the centerpiece for a mixed-up development in central Philadelphia under a newly announced joint venture of Brandywine Realty Trust (NYSE: BDN) and LCOR, which is partnering with the California State Teachers Retirement System (CalSTRS).
Construction will begin immediately with an expected spring 2016 delivery.
The 50/50 joint venture at 1919 Market Street will include residential, retail and parking, with 321 luxury units and 24,000 square feet of commercial space that is 90% pre-leased to Independence Blue Cross and CVS, plus a 215-car structured parking facility.
Brandywine contributed the land and will manage the retail and parking. LCOR will oversee construction of the project and will be responsible for the marketing, leasing, and management of the apartments.
Barton Partners is the architect for the project and Hunter Roberts Construction Group is the construction manager.
"Brandywine has a significant investment in the Philadelphia CBD and is committed to the resurgence of the Market Street West submarket," said Brandywine President and CEO Gerard H. Sweeney, noting that the development "adds tremendous neighborhood value to our 7 million square feet of office space."
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Construction will begin immediately with an expected spring 2016 delivery.
The 50/50 joint venture at 1919 Market Street will include residential, retail and parking, with 321 luxury units and 24,000 square feet of commercial space that is 90% pre-leased to Independence Blue Cross and CVS, plus a 215-car structured parking facility.
Brandywine contributed the land and will manage the retail and parking. LCOR will oversee construction of the project and will be responsible for the marketing, leasing, and management of the apartments.
Barton Partners is the architect for the project and Hunter Roberts Construction Group is the construction manager.
"Brandywine has a significant investment in the Philadelphia CBD and is committed to the resurgence of the Market Street West submarket," said Brandywine President and CEO Gerard H. Sweeney, noting that the development "adds tremendous neighborhood value to our 7 million square feet of office space."
www.omegare.com
Monday, October 27, 2014
Are more towers on the horizon in Philly?
by Joseph N. DiStefano Staff writer for the Philadelphia Inquirer
Liberty Property Trust plans to spend $900 million putting up Comcast's second tower over the next three years. That works out to about $600 a square foot to build.
Last week, the owners of 2.0 University Place, a year-old green-roofed building west of the Drexel campus, put it up for sale at $46 million, or $469 a square foot.
That's not quite as much as the Comcast tower - but roughly three times what the city's dominant landlord, Brandywine Realty Trust, was paying for central Philadelphia office towers just a few years back.
When the price of existing buildings approaches the cost of new construction, that can get builders and civic boosters excited. How long until someone decides it makes sense to build more office towers?
At least in University City, where rents landlords are asking for Class A office buildings averaged $44.88 per square foot, highest in the Philadelphia area.
The regional average is $27.51, a couple bucks higher in Center City, mostly lower in the suburbs, according to NGKF, the broker offering 2.0 University Place for sale.
With Drexel University, Penn Medicine, and Children's Hospital of Philadelphia all expanding, with new apartment towers crowding Market Street, the office vacancy rate in the neighborhood was reported under 6 percent, less than half the rate for any neighborhood in Center City, and just a third of what's empty in some suburban markets.
But on the other side of the Schuylkill, the data and the prospects aren't so good, says Glenn D. Blumenfeld of tenant broker Tactix.
Arguing for his clients, Blumenfeld says 2.0 University Place "is a very unique situation," given the long-term lease from the federal immigration service, and the high, very local demand these days in the medical-scholarly quarter of town.
Yes, building prices are generally going up, and not just in University City, he says: "A lot of foreign money is coming into the U.S. seeking 'safe' investments, and they are buying up lots of real estate," even at prices that look high compared with local rents.
But those prices will prove profitable to buyers only if rents eventually rise enough to justify the sale premiums, Blumenfeld reminded me.
He listed Center City office spaces due to go vacant over the next few years: Cigna and BNY Mellon are cutting back, Sunoco is heading to Newtown Square, FMC and Comcast will pull out of rented space for their new headquarters towers, the former GlaxoSmithKline complex at Franklin Plaza is still vacant except for a school, and nobody has signed up yet for Cozen O'Connor's expired lease.
These emptying blocks add up to more than two million square feet, or a couple of high-rise towers' worth. "As general demand continues to shrink, rents should drop" instead of rising, and that makes new construction less likely, Blumenfeld concludes.
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Liberty Property Trust plans to spend $900 million putting up Comcast's second tower over the next three years. That works out to about $600 a square foot to build.
Last week, the owners of 2.0 University Place, a year-old green-roofed building west of the Drexel campus, put it up for sale at $46 million, or $469 a square foot.
That's not quite as much as the Comcast tower - but roughly three times what the city's dominant landlord, Brandywine Realty Trust, was paying for central Philadelphia office towers just a few years back.
When the price of existing buildings approaches the cost of new construction, that can get builders and civic boosters excited. How long until someone decides it makes sense to build more office towers?
At least in University City, where rents landlords are asking for Class A office buildings averaged $44.88 per square foot, highest in the Philadelphia area.
The regional average is $27.51, a couple bucks higher in Center City, mostly lower in the suburbs, according to NGKF, the broker offering 2.0 University Place for sale.
With Drexel University, Penn Medicine, and Children's Hospital of Philadelphia all expanding, with new apartment towers crowding Market Street, the office vacancy rate in the neighborhood was reported under 6 percent, less than half the rate for any neighborhood in Center City, and just a third of what's empty in some suburban markets.
But on the other side of the Schuylkill, the data and the prospects aren't so good, says Glenn D. Blumenfeld of tenant broker Tactix.
Arguing for his clients, Blumenfeld says 2.0 University Place "is a very unique situation," given the long-term lease from the federal immigration service, and the high, very local demand these days in the medical-scholarly quarter of town.
Yes, building prices are generally going up, and not just in University City, he says: "A lot of foreign money is coming into the U.S. seeking 'safe' investments, and they are buying up lots of real estate," even at prices that look high compared with local rents.
But those prices will prove profitable to buyers only if rents eventually rise enough to justify the sale premiums, Blumenfeld reminded me.
He listed Center City office spaces due to go vacant over the next few years: Cigna and BNY Mellon are cutting back, Sunoco is heading to Newtown Square, FMC and Comcast will pull out of rented space for their new headquarters towers, the former GlaxoSmithKline complex at Franklin Plaza is still vacant except for a school, and nobody has signed up yet for Cozen O'Connor's expired lease.
These emptying blocks add up to more than two million square feet, or a couple of high-rise towers' worth. "As general demand continues to shrink, rents should drop" instead of rising, and that makes new construction less likely, Blumenfeld concludes.
www.omegare.com
College in Talks to Buy One of Two Closed Casinos
Richard Stockton College is in negotiations to acquire one of two shuttered casinos here for a new Atlantic City campus.
Atlantic City Mayor Don Guardian revealed the casino acquisition discussions at an economic forum meeting held on Wednesday in Burlington County. The mayor said the college is looking to purchase either the former Atlantic Club or Showboat casinos, according to the Press of Atlantic City.
“They were looking for a new campus for 10,000 students, and we were able to convince them that Atlantic City is the location,” Guardian says. “So in the next couple of weeks, you’ll see they’re either going to end up with the Atlantic Club, which means all the property in that section of town will become the college district, or they’re going to end up with Showboat, in which case the Southeast Inlet is going to become a district. They’re looking at 10,000 students, four undergraduate schools, four graduate schools.”
Sharon Schulman, Stockton’s CEO of external affairs and institutional research, confirmed that the college is still considering Atlantic City.
“Our status has not changed. Yes, as we have discussed, we are pursuing various opportunities in Atlantic City, but nothing is definite and it is premature to discuss them. There is nothing firm.”
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Atlantic City Mayor Don Guardian revealed the casino acquisition discussions at an economic forum meeting held on Wednesday in Burlington County. The mayor said the college is looking to purchase either the former Atlantic Club or Showboat casinos, according to the Press of Atlantic City.
“They were looking for a new campus for 10,000 students, and we were able to convince them that Atlantic City is the location,” Guardian says. “So in the next couple of weeks, you’ll see they’re either going to end up with the Atlantic Club, which means all the property in that section of town will become the college district, or they’re going to end up with Showboat, in which case the Southeast Inlet is going to become a district. They’re looking at 10,000 students, four undergraduate schools, four graduate schools.”
Sharon Schulman, Stockton’s CEO of external affairs and institutional research, confirmed that the college is still considering Atlantic City.
“Our status has not changed. Yes, as we have discussed, we are pursuing various opportunities in Atlantic City, but nothing is definite and it is premature to discuss them. There is nothing firm.”
www.omegare.com
Philadelphia Retail Vacancy Stays at 5.9%
The Philadelphia retail market did not experience much change in market conditions in the third quarter 2014.
The vacancy rate stayed constant ending at 5.9% in the previous quarter and 5.9% in the current quarter. Net absorption was positive 177,364 square feet, and vacant sublease space decreased by 5,476 square feet. In second quarter 2014, net absorption was positive 515,170 square feet.
Tenants moving into large blocks of space in 2014 include: ShopRite moving into 90,000 square feet at Wishing Well Plaza; Giant Food moving into 66,472 square feet at Ephrata Marketplace; and Burlington Coat Factory moving into 62,224 square feet at 1537 Bethlehem Pike.
Quoted rental rates decreased from second quarter 2014 levels, ending at $13.96 per square foot per year.
A total of 5 retail buildings with 80,793 square feet of retail space were delivered to the market in the quarter, with 389,251 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 6.3% from the previous quarter, with net absorption positive 26.48 million square feet in the third quarter. Average rental rates increased to $14.84, and 542 retail buildings delivered to the market totaling more than 13.9 million square feet.
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The vacancy rate stayed constant ending at 5.9% in the previous quarter and 5.9% in the current quarter. Net absorption was positive 177,364 square feet, and vacant sublease space decreased by 5,476 square feet. In second quarter 2014, net absorption was positive 515,170 square feet.
Tenants moving into large blocks of space in 2014 include: ShopRite moving into 90,000 square feet at Wishing Well Plaza; Giant Food moving into 66,472 square feet at Ephrata Marketplace; and Burlington Coat Factory moving into 62,224 square feet at 1537 Bethlehem Pike.
Quoted rental rates decreased from second quarter 2014 levels, ending at $13.96 per square foot per year.
A total of 5 retail buildings with 80,793 square feet of retail space were delivered to the market in the quarter, with 389,251 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 6.3% from the previous quarter, with net absorption positive 26.48 million square feet in the third quarter. Average rental rates increased to $14.84, and 542 retail buildings delivered to the market totaling more than 13.9 million square feet.
www.omegare.com
Trevose Industrial Sold for $3.5M
Deep Creek Holdings LLC purchased the industrial building at 2555 - 2575 Metropolitan Dr. in Trevose, PA from SDC Trevose Metropolitan Business Center, Inc. for $3.5 million, or about $59 per square foot.
The 60,000-square-foot warehouse was constructed in 1977 on 4.3 acres in the Bucks County Industrial submarket of Philadelphia. It features 12 percent office build-out, seven loading docks and one drive-in, 20-foot clear heights, air lines, and 3,000-amp heavy power.
www.omegare.com
The 60,000-square-foot warehouse was constructed in 1977 on 4.3 acres in the Bucks County Industrial submarket of Philadelphia. It features 12 percent office build-out, seven loading docks and one drive-in, 20-foot clear heights, air lines, and 3,000-amp heavy power.
www.omegare.com
Thursday, October 23, 2014
Clarion/MRP Acquire 129-Acre Warehouse Distribution Site in Central PA
New York real estate investment manager Clarion Partners has once again teamed up with MRP Realty's industrial real estate affiliate to buy the former I-81/I-78 Logistics Park in Lebanon County, PA.
The new owners have renamed the planned two-building, 1,502,000-square-foot warehouse-distribution development Gateway Logistics Park. Located on a 129-acre site, the project includes development parcels for a 1,002,000-square-foot building and a smaller 500,000-square-foot center with pads in place.
Gateway Logistics Park is the third industrial real estate project the two companies have built and owned, including Fulling Mill Road in Harrisburg and Burlington Industrial Park in Burlington, NJ.
The two firms said they are focused on providing warehouse distribution faciltiies to support the growing trend among major retailers for direct-to-consumer fulfillment.
"With the market’s supply constraints we feel we are well positioned to capture build-to-suit opportunities or build spec inventory" with this property, said Andy Sitzer, senior vice president with Clarion Partners.
"Over the past 12 months, the Central Pennsylvania market has experienced nearly eight million square feet of new absorption, with a steady pipeline of new tenants entering the market," said D. Reid Townsend, principal with the Baltimore-based MRP Industrial.
Located where Interstates 81 and 78 merge east of Harrisburg, the property is within 30 miles of a new 300,000-square-foot FedEx distribution center at 111 Fulling Mill Rd. and a new UPS distribution hub.
Earlier this year, Pennsylvania approved the property's application for the Commonwealth’s Local Economic Revitalization Tax Assistance (LERTA) program, which offers partial real estate tax relief to future tenants during the initial 10 years of occupancy.
The property seller, I-81/I-78 Logistics Park, LLC, was a partnership between Panattoni Development Co. and the California State Teachers' Retirement System. Design and entitlements were led by Ware Malcomb Architects, Herbert Rowland & Grubic, Inc. and Advantage Engineering.
www.omegare.com
The new owners have renamed the planned two-building, 1,502,000-square-foot warehouse-distribution development Gateway Logistics Park. Located on a 129-acre site, the project includes development parcels for a 1,002,000-square-foot building and a smaller 500,000-square-foot center with pads in place.
Gateway Logistics Park is the third industrial real estate project the two companies have built and owned, including Fulling Mill Road in Harrisburg and Burlington Industrial Park in Burlington, NJ.
The two firms said they are focused on providing warehouse distribution faciltiies to support the growing trend among major retailers for direct-to-consumer fulfillment.
"With the market’s supply constraints we feel we are well positioned to capture build-to-suit opportunities or build spec inventory" with this property, said Andy Sitzer, senior vice president with Clarion Partners.
"Over the past 12 months, the Central Pennsylvania market has experienced nearly eight million square feet of new absorption, with a steady pipeline of new tenants entering the market," said D. Reid Townsend, principal with the Baltimore-based MRP Industrial.
Located where Interstates 81 and 78 merge east of Harrisburg, the property is within 30 miles of a new 300,000-square-foot FedEx distribution center at 111 Fulling Mill Rd. and a new UPS distribution hub.
Earlier this year, Pennsylvania approved the property's application for the Commonwealth’s Local Economic Revitalization Tax Assistance (LERTA) program, which offers partial real estate tax relief to future tenants during the initial 10 years of occupancy.
The property seller, I-81/I-78 Logistics Park, LLC, was a partnership between Panattoni Development Co. and the California State Teachers' Retirement System. Design and entitlements were led by Ware Malcomb Architects, Herbert Rowland & Grubic, Inc. and Advantage Engineering.
www.omegare.com
Tuesday, October 21, 2014
Monday, October 20, 2014
Friday, October 17, 2014
Philadelphia Area Office Vacancy Stays at 11.0% for 3rd Quarter
The Philadelphia Office market ended the third quarter 2014 with a vacancy rate of 11.0%.
The vacancy rate was unchanged over the previous quarter, with net absorption totaling positive 131,961 square feet in the third quarter. That compares to positive 760,857 square feet in the second quarter 2014. Vacant sublease space increased in the quarter, ending the quarter at 1,388,566 square feet.
Tenants moving into large blocks of space in 2014 include: The Vanguard Group moving into 204,000 square feet at Great Valley Corp Center; The Harrisburg University of Science & Technology moving into 149,820 square feet at Harrisburg University Academic Center; and Beneficial Mutual Bancorp, Inc. moving into 95,764 square feet at 1818 Beneficial Bank Place.
Rental rates ended the third quarter at $21.62, an increase over the previous quarter.
A total of two buildings delivered to the market in the quarter totaling 219,036 square feet, with 3,506,297 square feet still under construction at the end of the quarter.
This trend is compared to the U.S. National Office vacancy rate, which decreased to 11.2% from the previous quarter, with net absorption positive 27.56 million square feet in the third quarter. Average rental rates increased to $22.38, and 233 buildings delivered to the market totaling almost 13.2 million square feet.
www.omegare.com
The vacancy rate was unchanged over the previous quarter, with net absorption totaling positive 131,961 square feet in the third quarter. That compares to positive 760,857 square feet in the second quarter 2014. Vacant sublease space increased in the quarter, ending the quarter at 1,388,566 square feet.
Tenants moving into large blocks of space in 2014 include: The Vanguard Group moving into 204,000 square feet at Great Valley Corp Center; The Harrisburg University of Science & Technology moving into 149,820 square feet at Harrisburg University Academic Center; and Beneficial Mutual Bancorp, Inc. moving into 95,764 square feet at 1818 Beneficial Bank Place.
Rental rates ended the third quarter at $21.62, an increase over the previous quarter.
A total of two buildings delivered to the market in the quarter totaling 219,036 square feet, with 3,506,297 square feet still under construction at the end of the quarter.
This trend is compared to the U.S. National Office vacancy rate, which decreased to 11.2% from the previous quarter, with net absorption positive 27.56 million square feet in the third quarter. Average rental rates increased to $22.38, and 233 buildings delivered to the market totaling almost 13.2 million square feet.
www.omegare.com
Thursday, October 16, 2014
Kislak Completes $42 Million Eastern PA MF Sales
by Steve Lubetkin, Globest.com
The Kislak Company has sold three multifamily properties in eastern Pennsylvania for nearly $42 million.
The transactions include the $31.1 million combined sale of Belair Townhomes, a 208-unit property, and Mayfair Manor Apartments at Grandview, a 60-unit property, both in Lancaster. Kislak also handled the $10.6 million separate sale of Auburn Station, an 85-unit loft-style property with land to build an additional 49 units in Allentown. Robert Holland, Kislak’s president, represented the sellers and purchasers, longtime Kislak clients, in both transactions.
Belair Townhomes, Lancaster, PA
“The central and eastern PA market is very hot for both buyers and sellers,” Holland tells GlobeSt.com exclusively. “It was a good time for the sellers to sell given the premium pricing. It was also a good time for the buyers to buy given the growth potential amid low interest rates with an eye toward long term hold.”
Belair Townhomes is a 208-unit luxury apartment complex that includes large one-, two-, three- and four-bedroom units with private entrances and patios in 26 three-story buildings on 32 acres. Approximately 95% of the units have been renovated and all units include individual HVAC units, eat-in kitchens, walk-in closets and laundry rooms. The complex includes ample parking and garages are available to select units.
Kislak president Robert Holland handled all three sales.
Mayfair Manor Apartments at Grandview is a 60-unit garden apartment complex located less than ten minutes from Belair Townhomes and includes large one-, two-, and three-bedroom units. Ample amenities include eat-in kitchens, balconies or terraces, and laundry facilities. The property is also 97% renovated.
Berkadia arranged Freddie Mac financing. At the time of closing, the properties were approximately 95% occupied.
Auburn Station, Allentown, PA
Auburn Station is an 85-unit loft-style apartment building with on-site parking and land to build an additional 49 units. The property contains two two-story mill-style buildings and was recently gut renovated. Units have large, open and spacious floor plans.
Scott Lipson, Esq. of Norris, McLaughlin & Marcus, PA represented the seller, and Jason Weiss, Esq. represented the buyer. Eastern Union arranged financing through Investors Bank. At the time of closing, the property was 100% occupied.
www.omegare.com
The Kislak Company has sold three multifamily properties in eastern Pennsylvania for nearly $42 million.
The transactions include the $31.1 million combined sale of Belair Townhomes, a 208-unit property, and Mayfair Manor Apartments at Grandview, a 60-unit property, both in Lancaster. Kislak also handled the $10.6 million separate sale of Auburn Station, an 85-unit loft-style property with land to build an additional 49 units in Allentown. Robert Holland, Kislak’s president, represented the sellers and purchasers, longtime Kislak clients, in both transactions.
Belair Townhomes, Lancaster, PA
“The central and eastern PA market is very hot for both buyers and sellers,” Holland tells GlobeSt.com exclusively. “It was a good time for the sellers to sell given the premium pricing. It was also a good time for the buyers to buy given the growth potential amid low interest rates with an eye toward long term hold.”
Belair Townhomes is a 208-unit luxury apartment complex that includes large one-, two-, three- and four-bedroom units with private entrances and patios in 26 three-story buildings on 32 acres. Approximately 95% of the units have been renovated and all units include individual HVAC units, eat-in kitchens, walk-in closets and laundry rooms. The complex includes ample parking and garages are available to select units.
Kislak president Robert Holland handled all three sales.
Mayfair Manor Apartments at Grandview is a 60-unit garden apartment complex located less than ten minutes from Belair Townhomes and includes large one-, two-, and three-bedroom units. Ample amenities include eat-in kitchens, balconies or terraces, and laundry facilities. The property is also 97% renovated.
Berkadia arranged Freddie Mac financing. At the time of closing, the properties were approximately 95% occupied.
Auburn Station, Allentown, PA
Auburn Station is an 85-unit loft-style apartment building with on-site parking and land to build an additional 49 units. The property contains two two-story mill-style buildings and was recently gut renovated. Units have large, open and spacious floor plans.
Scott Lipson, Esq. of Norris, McLaughlin & Marcus, PA represented the seller, and Jason Weiss, Esq. represented the buyer. Eastern Union arranged financing through Investors Bank. At the time of closing, the property was 100% occupied.
www.omegare.com
Blatstein-Steelman Agree to Buy Caesars Pier
By Joseph N. DiStefano, Inquirer Staff Writer
Philadelphia developer Bart Blatstein said Sunday he and casino architect Paul Steelman had agreed to buy the four-story, 300,000-square-foot, half-empty Caesars Pier shopping center in Atlantic City for a small fraction of its construction cost.
A person familiar with the deal said Blatstein and Steelman agreed to pay $2.8 million. That's less than 2 percent of the $200 million-plus that developer Taubman Centers of the Detroit suburbs and other investors plowed into the project in the mid-00s. The partners hope to close the deal this year.
"I love Atlantic City. I grew up going to the Shore. And this is the best time to buy there," with casinos shutting down and property values cratering, Blatstein said. "For those who think A.C. is done for, they are out of their minds. This is a great opportunity to come back into Atlantic City." He declined to comment on specific plans until after the deal is done.
Taubman had imagined 85 retailers selling Apple smartphones, Baccarat crystal, Gucci and Hugo Boss accessories, Louis Vuitton luggage, and Tiffany jewelry, as well as middle-class clothing brands such as Banana Republic and Guess, and branches of Philadelphia's Buddakan and Continental restaurants would appeal to gamblers looking to spend casino winnings, as well as to other visitors.
But the 2008 recession and the rapid increase in competition from casinos in Pennsylvania and other states crippled Atlantic City retailing.
In 2009, Taubman wrote off $108 million it and others had invested in Caesars, and said it would stop subsidizing the mall's operations; stores began to close. In 2011, a group of lenders foreclosed on the center, canceling $135 million in debt and interest Taubman still owed, and put the glass-walled center up for sale.
Blatstein said he and Steelman weren't planning gambling or residential uses, but were open to other commercial tenants.
Steelman, a Longport native and Atlantic City High School graduate whose clients include gambling mogul Steve Wynn and Brookfield Property Partners L.P., which recently bought Atlantic City's twice-bankrupt Revel casino for a fraction of its construction cost, is also the designer for Blatstein's proposed Provence casino at The Inquirer's former plant on North Broad Street.
"Paul's from down the Shore," Blatstein said. "He's got such a creative, brilliant mind. He's got projects in Vietnam and Macau and Moscow. I love working with him; he sees it all."
Full story: http://tinyurl.com/lm4ccjw
www.omegare.com
Philadelphia developer Bart Blatstein said Sunday he and casino architect Paul Steelman had agreed to buy the four-story, 300,000-square-foot, half-empty Caesars Pier shopping center in Atlantic City for a small fraction of its construction cost.
A person familiar with the deal said Blatstein and Steelman agreed to pay $2.8 million. That's less than 2 percent of the $200 million-plus that developer Taubman Centers of the Detroit suburbs and other investors plowed into the project in the mid-00s. The partners hope to close the deal this year.
"I love Atlantic City. I grew up going to the Shore. And this is the best time to buy there," with casinos shutting down and property values cratering, Blatstein said. "For those who think A.C. is done for, they are out of their minds. This is a great opportunity to come back into Atlantic City." He declined to comment on specific plans until after the deal is done.
Taubman had imagined 85 retailers selling Apple smartphones, Baccarat crystal, Gucci and Hugo Boss accessories, Louis Vuitton luggage, and Tiffany jewelry, as well as middle-class clothing brands such as Banana Republic and Guess, and branches of Philadelphia's Buddakan and Continental restaurants would appeal to gamblers looking to spend casino winnings, as well as to other visitors.
But the 2008 recession and the rapid increase in competition from casinos in Pennsylvania and other states crippled Atlantic City retailing.
In 2009, Taubman wrote off $108 million it and others had invested in Caesars, and said it would stop subsidizing the mall's operations; stores began to close. In 2011, a group of lenders foreclosed on the center, canceling $135 million in debt and interest Taubman still owed, and put the glass-walled center up for sale.
Blatstein said he and Steelman weren't planning gambling or residential uses, but were open to other commercial tenants.
Steelman, a Longport native and Atlantic City High School graduate whose clients include gambling mogul Steve Wynn and Brookfield Property Partners L.P., which recently bought Atlantic City's twice-bankrupt Revel casino for a fraction of its construction cost, is also the designer for Blatstein's proposed Provence casino at The Inquirer's former plant on North Broad Street.
"Paul's from down the Shore," Blatstein said. "He's got such a creative, brilliant mind. He's got projects in Vietnam and Macau and Moscow. I love working with him; he sees it all."
Full story: http://tinyurl.com/lm4ccjw
www.omegare.com
Wednesday, October 15, 2014
Tuesday, October 14, 2014
University City on the rise
by Natalie Kostelni, Staff writer for Philadelphia Business Journal
There is a plethora of construction activity underway in University City. (I wrote about the construction activity underway in this week's print edition.)
While real estate development is on the rise in the West Philadelphia neighborhood, other positive indicators point to an area of the city that has reversed a trend of decline and is thriving. It’s not glimmers of success, either.
Jobs and employment have risen, population grown, housing stock increased, the number of restaurants and retailers crept up and the amount of office inventory has expanded and maintains an enviable 96 occupancy rate, according to University City’s latest annual report. An abundance of development activity is underway and billions of dollars more will eventually be set in motion. Learn more here.
While data reveal how well University City is doing these days, there is still work to be done, said Matt Bergheiser, executive director of University City District, or UCD.
UCD continues to work on the West Philadelphia Skills Initiative, which connects residents with nearby employers. So far, it has placed more than 125 people in jobs.
Full story: http://tinyurl.com/lwklsdj
www.omegare.com
There is a plethora of construction activity underway in University City. (I wrote about the construction activity underway in this week's print edition.)
While real estate development is on the rise in the West Philadelphia neighborhood, other positive indicators point to an area of the city that has reversed a trend of decline and is thriving. It’s not glimmers of success, either.
Jobs and employment have risen, population grown, housing stock increased, the number of restaurants and retailers crept up and the amount of office inventory has expanded and maintains an enviable 96 occupancy rate, according to University City’s latest annual report. An abundance of development activity is underway and billions of dollars more will eventually be set in motion. Learn more here.
While data reveal how well University City is doing these days, there is still work to be done, said Matt Bergheiser, executive director of University City District, or UCD.
UCD continues to work on the West Philadelphia Skills Initiative, which connects residents with nearby employers. So far, it has placed more than 125 people in jobs.
Full story: http://tinyurl.com/lwklsdj
www.omegare.com
Friday, October 10, 2014
Trammell Crow sells 150 acres in Malvern for $35M
by Natalie Kostelni Staff writer for Philadelphia Business Journal
Trammell Crow Co. has sold 150 acres of its Atwater Corporate Center in Malvern, Pa., for $35.5 million, according to public property records.
Reiser Land Development of Naples, Fla., bought the land and has already unloaded 13 acres for $12.5 million to Johnson Development of Spartanburg, S.C., records show. The developer has plans to construct a 300-unit apartment complex called Haven at Atwater.
The transactions are part of a bigger plan Trammell Crow set in motion back in 2011 when it went to East Whiteland officials seeking an overlay that permitted mixed-use development on the Atwater property. It veered from the original Atwater project, which was focused just on office development. The mixed-use overlay allowed multifamily, single-family and retail construction.
The 150 acres that Reiser Land Development bought are on the southside of the tract located off Route 29. Reiser is in the business of selling approved parcels to developers.
In addition to selling the acreage to Johnson Development, NV Homes has 122 acres under contract and has presented plans before the township that it intends to construct single-family homes as well as townhouses. About 15 acres fronting Route 29 and the Pennsylvania Turnpike interchange has been set aside for retail development and no word yet on who might pick up that property.
Full story: http://tinyurl.com/m8adteq
www.omegare.com
Trammell Crow Co. has sold 150 acres of its Atwater Corporate Center in Malvern, Pa., for $35.5 million, according to public property records.
Reiser Land Development of Naples, Fla., bought the land and has already unloaded 13 acres for $12.5 million to Johnson Development of Spartanburg, S.C., records show. The developer has plans to construct a 300-unit apartment complex called Haven at Atwater.
The transactions are part of a bigger plan Trammell Crow set in motion back in 2011 when it went to East Whiteland officials seeking an overlay that permitted mixed-use development on the Atwater property. It veered from the original Atwater project, which was focused just on office development. The mixed-use overlay allowed multifamily, single-family and retail construction.
The 150 acres that Reiser Land Development bought are on the southside of the tract located off Route 29. Reiser is in the business of selling approved parcels to developers.
In addition to selling the acreage to Johnson Development, NV Homes has 122 acres under contract and has presented plans before the township that it intends to construct single-family homes as well as townhouses. About 15 acres fronting Route 29 and the Pennsylvania Turnpike interchange has been set aside for retail development and no word yet on who might pick up that property.
Full story: http://tinyurl.com/m8adteq
www.omegare.com
Thursday, October 9, 2014
South Jersey CRE Market Shifting from Recovery to Growth
by Steve Lubetkin Globest.com
Continuing a trend first noted during the second quarter, the Southern New Jersey commercial real estate market appears to be shifting from recovery to growth, according to the latest analysis.
The firm's third quarter market report finds mostly positive trends during the third quarter. The CRE market continued building upon positive trends seen in the previous quarters, with increases in new leases and renewals, as well as further positive absorption of vacant properties.
“The market's fundamentals continue to strengthen, and it seems like the economy has found its footing after a prolonged period of recovery.We're still a long way off from pre-recession levels, but hiring is up, office employment is up, and businesses are showing signs of expansion, all of which bodes well for the commercial real estate market.”
About 398,778 square feet of new office leases and renewals were signed in Burlington, Camden, and Gloucester Counties during the second quarter, including several large spaces, ranging in size from 6,000 to nearly 37,000 square feet.
Expansions and new deals continued to pick up steam this quarter, representing 54 percent of all transactions, an uptick from the 52 percent represented in the second quarter.
Positive absorption for the quarter was approximately 137,366 sf, an increase of more than 20 percent from the second quarter.
Finally, there are approximately 530,000 square feet of pending deals expected to close by the end of the year or early 2015. While this is quite a large figure, four major pending transactions account for about 300,000 square feet.
The report noted that the prime 3M locations within Burlington County continue to outpace the rest of the region, and that the tightening of those areas is causing demand to shift toward vacancies in Camden County. This is a trend that has been underway all year.
Other office market highlights from the report:
The vacancy rate for the third quarter was 14.2%.
Average rents for class A and B product continue to show strong support in the range of $10.00-$14.00 per square foot triple-net, or $21.00-$24.00 per square foot gross, with an overall market average showing strong support in the $10.00-$12.00 per square foot triple-net, or $20.00-$22.00 per square foot gross. This is essentially unchanged from the previous quarter.
New lease activity for Q3 is in the range of approximately 215,794 square feet of new deals and approximately 182,984 square feet of renewals and/or expansions. Both figures represent increases over the previous quarter.
All of the major private owners and REITS reported a noticeable slowdown in prospect activity for the quarter, though this may have been attributable to the expected summer slowdown.
WCRE also reported on the local retail market, where Southern New Jersey seems to have bounced back from a slow spring. Highlights from the retail section of the report include:
Retail sales figures for the region were buoyed by an increase in tourism, which helped maintain slight growth.
Overall retail vacancy in the tri-county area is at 15.1%, which is down about half a point from the second quarter. This is a particularly good sign, as vacancy had been ticking up for the first half of the year.
Class A retail product rental rates continue to show strong support in the range of $30.00-$40.00 per square foot triple-net, which is essentially unchanged from the previous several quarters.
Class B product shows support in the range of $15.00-$25.00 per square foot triple-net, which is also unchanged.
www.omegare.com
Continuing a trend first noted during the second quarter, the Southern New Jersey commercial real estate market appears to be shifting from recovery to growth, according to the latest analysis.
The firm's third quarter market report finds mostly positive trends during the third quarter. The CRE market continued building upon positive trends seen in the previous quarters, with increases in new leases and renewals, as well as further positive absorption of vacant properties.
“The market's fundamentals continue to strengthen, and it seems like the economy has found its footing after a prolonged period of recovery.We're still a long way off from pre-recession levels, but hiring is up, office employment is up, and businesses are showing signs of expansion, all of which bodes well for the commercial real estate market.”
About 398,778 square feet of new office leases and renewals were signed in Burlington, Camden, and Gloucester Counties during the second quarter, including several large spaces, ranging in size from 6,000 to nearly 37,000 square feet.
Expansions and new deals continued to pick up steam this quarter, representing 54 percent of all transactions, an uptick from the 52 percent represented in the second quarter.
Positive absorption for the quarter was approximately 137,366 sf, an increase of more than 20 percent from the second quarter.
Finally, there are approximately 530,000 square feet of pending deals expected to close by the end of the year or early 2015. While this is quite a large figure, four major pending transactions account for about 300,000 square feet.
The report noted that the prime 3M locations within Burlington County continue to outpace the rest of the region, and that the tightening of those areas is causing demand to shift toward vacancies in Camden County. This is a trend that has been underway all year.
Other office market highlights from the report:
The vacancy rate for the third quarter was 14.2%.
Average rents for class A and B product continue to show strong support in the range of $10.00-$14.00 per square foot triple-net, or $21.00-$24.00 per square foot gross, with an overall market average showing strong support in the $10.00-$12.00 per square foot triple-net, or $20.00-$22.00 per square foot gross. This is essentially unchanged from the previous quarter.
New lease activity for Q3 is in the range of approximately 215,794 square feet of new deals and approximately 182,984 square feet of renewals and/or expansions. Both figures represent increases over the previous quarter.
All of the major private owners and REITS reported a noticeable slowdown in prospect activity for the quarter, though this may have been attributable to the expected summer slowdown.
WCRE also reported on the local retail market, where Southern New Jersey seems to have bounced back from a slow spring. Highlights from the retail section of the report include:
Retail sales figures for the region were buoyed by an increase in tourism, which helped maintain slight growth.
Overall retail vacancy in the tri-county area is at 15.1%, which is down about half a point from the second quarter. This is a particularly good sign, as vacancy had been ticking up for the first half of the year.
Class A retail product rental rates continue to show strong support in the range of $30.00-$40.00 per square foot triple-net, which is essentially unchanged from the previous several quarters.
Class B product shows support in the range of $15.00-$25.00 per square foot triple-net, which is also unchanged.
www.omegare.com
Bristol Industrial Sold for $3M
Industrial Investments, Inc. acquired the industrial building at 181 Rittenhouse Cir. in Bristol, PA from Quad Graphics, Inc. for $3 million, or about $25 per square foot.
The 120,557-square-foot warehouse was built in 1988 on 5.9 acres in the Bucks County Industrial submarket of Philadelphia. It features 14 loading docks and one drive-in, 25-foot clear heights, 2,500-amp heavy power, and is located in an Enterprise Zone.
www.omegare.com
The 120,557-square-foot warehouse was built in 1988 on 5.9 acres in the Bucks County Industrial submarket of Philadelphia. It features 14 loading docks and one drive-in, 25-foot clear heights, 2,500-amp heavy power, and is located in an Enterprise Zone.
Hershey Square Sold for $28.5M
Heidenberg Properties acquired the Hershey Square shopping center at 1130-1170 Mae St. in Hummelstown, PA from Hershey Trust Co. for $28.5 million, or about $131 per square foot.
The 218,290-square-foot, grocery-anchored community retail center was constructed in 1994 on more than 30 acres in the Harrisburg Area East submarket of Dauphin County, less than two miles from Hershey Park.
www.omegare.com
The 218,290-square-foot, grocery-anchored community retail center was constructed in 1994 on more than 30 acres in the Harrisburg Area East submarket of Dauphin County, less than two miles from Hershey Park.
www.omegare.com
LPT Buys 51 Acres in Florence, NJ
Liberty Property Trust acquired a 50.5-acre parcel on W. Cedar Ln. in Florence, NJ from Covington Group, Inc. for $10.5 million, or about $208,000 per acre.
The industrial land is located west of the NJ Turnpike in Philadelphia's North Burlington County submarket. The sale closed with no approvals in place, but the buyer is expected to develop a facility totaling at least 600,000 square feet there.
www.omegare.com
The industrial land is located west of the NJ Turnpike in Philadelphia's North Burlington County submarket. The sale closed with no approvals in place, but the buyer is expected to develop a facility totaling at least 600,000 square feet there.
www.omegare.com
Wednesday, October 8, 2014
Tuesday, October 7, 2014
Monday, October 6, 2014
United Plaza, 1650 Arch St. for sale as portfolio for $200M
by Natalie Kostelni Staff writer for Philadelphia Business Journal
Two more Center City office buildings are coming on the market, adding to a growing list of downtown office buildings that are up for sale as investor interest in the Central Business District strengthens.
United Plaza and 1650 Arch St. are being packaged as a portfolio and anticipated to sell for as much as $200 million, according to an estimate. Though the buildings are being marketed together, they could be sold individually to the right buyers.
The strategy to sell them together came about since they have the same owner (TIER REIT) and the properties have a very similar profile that will attract similar buyers. “We believe there are synergies in owning both assets, basically economies of scale.”
Both buildings are well leased with significant credit and lease terms, he said. Debt markets are as healthy as they’ve been in recent memory, which will help generate aggressive pricing for the portfolio or on an individual basis.
TIER REIT, which is formerly Behringer Harvard REIT I Inc. of Dallas, Texas, is the seller.
United Plaza stands 20 stories and totals 617,476 square feet. It is 93.7 percent leased. Duane Morris, a law firm, occupies 257,000 square feet of the building for its headquarters. Its lease doesn’t expire until August 2019.
When the building was first acquired in 2002 by another company, Oaktree Capital Management, it spent $31 million conducting a total renovation of the building at 30 S. 17 th St. At the time, the property was dated, having been constructed in 1975, and had lost an engineering firm that took up nearly half of the building. It was also renamed United Plaza from United Engineers.
Full story: http://tinyurl.com/pgha8fv
.omegare.com
Two more Center City office buildings are coming on the market, adding to a growing list of downtown office buildings that are up for sale as investor interest in the Central Business District strengthens.
United Plaza and 1650 Arch St. are being packaged as a portfolio and anticipated to sell for as much as $200 million, according to an estimate. Though the buildings are being marketed together, they could be sold individually to the right buyers.
The strategy to sell them together came about since they have the same owner (TIER REIT) and the properties have a very similar profile that will attract similar buyers. “We believe there are synergies in owning both assets, basically economies of scale.”
Both buildings are well leased with significant credit and lease terms, he said. Debt markets are as healthy as they’ve been in recent memory, which will help generate aggressive pricing for the portfolio or on an individual basis.
TIER REIT, which is formerly Behringer Harvard REIT I Inc. of Dallas, Texas, is the seller.
United Plaza stands 20 stories and totals 617,476 square feet. It is 93.7 percent leased. Duane Morris, a law firm, occupies 257,000 square feet of the building for its headquarters. Its lease doesn’t expire until August 2019.
When the building was first acquired in 2002 by another company, Oaktree Capital Management, it spent $31 million conducting a total renovation of the building at 30 S. 17 th St. At the time, the property was dated, having been constructed in 1975, and had lost an engineering firm that took up nearly half of the building. It was also renamed United Plaza from United Engineers.
Full story: http://tinyurl.com/pgha8fv
.omegare.com
Bancroft Relocating to Recently Acquired Building
by Steve Lubetkin Staff Writer at Globest.com
Bancroft, a neurological healthcare provider for children and adults with intellectual or developmental disabilities and adults needing neurological rehabilitation, will relocate its headquarters to 1255 Caldwell Road, a recently purchased 41,500 square foot office building located in Cherry Hill, NJ. The building presently houses the headquarters of Admiral Insurance Company, a division of the W.R. Berkley Corporation, an excess and surplus lines commercial carrier.
As of January 1, 2015, the new headquarters will house all of the organization’s administrative departments that support programs and services throughout New Jersey, Pennsylvania and Delaware.
“This new, modern office space will allow our leadership and administrative departments to operate more efficiently and comfortably as they strive to accomplish Bancroft’s mission of offering a wide range of programs and services that make a real difference in people’s lives,” —says Toni Pergolin, Bancroft president and CEO.
“We are thrilled that Bancroft has chosen Cherry Hill to be its new headquarters location,” says Cherry Hill Mayor Chuck Cahn. “It signals a continuation of Bancroft’s 131 year commitment to the Camden County community, where Bancroft today employs over 1,000 people, and is another example of the steady and significant growth of economic development in Cherry Hill.”
The new building will also house an additional location of Bancroft Office Support Services (BOSS), a full service printing and office support business staffed entirely by adults served at Bancroft. BOSS, a division of Bancroft Enterprises, will continue to serve the printing and copying needs of the Bancroft staff while remaining open to members of the community from that location as well.
Bancroft has other facilities expansion initiatives underway. Earlier this year, Bancroft announced the December 2014 opening of the Bancroft NeuroRehab Resnick Center at Mount Laurel in Mount Laurel, NJ. The 18,000-square-foot facility will enable Bancroft NeuroRehab to expand its services in occupational therapy, physical therapy, speech therapy, neuropsychology, cognitive rehabilitation therapy, therapeutic activities, health and wellness programs, and nutritional counseling with a special focus on serving veterans.
“As our expansion continues, it will allow Bancroft to serve even more individuals in community-based settings,” says Pergolin.
www.omegare.com
Bancroft, a neurological healthcare provider for children and adults with intellectual or developmental disabilities and adults needing neurological rehabilitation, will relocate its headquarters to 1255 Caldwell Road, a recently purchased 41,500 square foot office building located in Cherry Hill, NJ. The building presently houses the headquarters of Admiral Insurance Company, a division of the W.R. Berkley Corporation, an excess and surplus lines commercial carrier.
As of January 1, 2015, the new headquarters will house all of the organization’s administrative departments that support programs and services throughout New Jersey, Pennsylvania and Delaware.
“This new, modern office space will allow our leadership and administrative departments to operate more efficiently and comfortably as they strive to accomplish Bancroft’s mission of offering a wide range of programs and services that make a real difference in people’s lives,” —says Toni Pergolin, Bancroft president and CEO.
“We are thrilled that Bancroft has chosen Cherry Hill to be its new headquarters location,” says Cherry Hill Mayor Chuck Cahn. “It signals a continuation of Bancroft’s 131 year commitment to the Camden County community, where Bancroft today employs over 1,000 people, and is another example of the steady and significant growth of economic development in Cherry Hill.”
The new building will also house an additional location of Bancroft Office Support Services (BOSS), a full service printing and office support business staffed entirely by adults served at Bancroft. BOSS, a division of Bancroft Enterprises, will continue to serve the printing and copying needs of the Bancroft staff while remaining open to members of the community from that location as well.
Bancroft has other facilities expansion initiatives underway. Earlier this year, Bancroft announced the December 2014 opening of the Bancroft NeuroRehab Resnick Center at Mount Laurel in Mount Laurel, NJ. The 18,000-square-foot facility will enable Bancroft NeuroRehab to expand its services in occupational therapy, physical therapy, speech therapy, neuropsychology, cognitive rehabilitation therapy, therapeutic activities, health and wellness programs, and nutritional counseling with a special focus on serving veterans.
“As our expansion continues, it will allow Bancroft to serve even more individuals in community-based settings,” says Pergolin.
www.omegare.com
Friday, October 3, 2014
Poultry Producer Procures Pinnacle's Pickle Processing Plant
Pinnacle Foods Finance LLC has sold the industrial building at 29984 Pinnacle Way in Millsboro, DE to Allen Harim, a leading producer and processor of chicken in the DelMarVa area, for almost $5.6 million, or about $12 per square foot.
The 460,000-square-foot distribution facility was constructed in 1972 on 107 acres in the Sussex County Industrial submarket of Philadelphia. Vacant for more than two years, the former pickle processing facility features 15 loading docks and four drive-ins, 24-foot clear heights, eight-inch floors, and 2,000-amp heavy power.
Allen Harim anticipates the complex will be used initially as warehouse and storage space, though further evaluation may be necessary to decide on its highest and best use. The Seaford, DE-based company employs more than 1,600 people across the U.S., including more than 1,000 in Delaware alone, and partners with 200 independent growers while managing 25 company-owned farms in the area.
"Allen Harim is committed to investing in our people, facilities and infrastructure," said Steven A. Evans, CEO of Allen Harim. "This acquisition aligns with our strategic plan and supports our company's vision, mission and values. It is our desire to be a good neighbor in all of the regions in which we operate, and we look forward to becoming part of the fabric of Millsboro."
www.omegare.com
The 460,000-square-foot distribution facility was constructed in 1972 on 107 acres in the Sussex County Industrial submarket of Philadelphia. Vacant for more than two years, the former pickle processing facility features 15 loading docks and four drive-ins, 24-foot clear heights, eight-inch floors, and 2,000-amp heavy power.
Allen Harim anticipates the complex will be used initially as warehouse and storage space, though further evaluation may be necessary to decide on its highest and best use. The Seaford, DE-based company employs more than 1,600 people across the U.S., including more than 1,000 in Delaware alone, and partners with 200 independent growers while managing 25 company-owned farms in the area.
"Allen Harim is committed to investing in our people, facilities and infrastructure," said Steven A. Evans, CEO of Allen Harim. "This acquisition aligns with our strategic plan and supports our company's vision, mission and values. It is our desire to be a good neighbor in all of the regions in which we operate, and we look forward to becoming part of the fabric of Millsboro."
Shippensburg Marketplace Sells for $12M
ACL Realty Corporation sold the Shippensburg Marketplace at 397 Baltimore Rd. in Shippensburg, PA for $12 million, or about $211 per square foot, to ARC Properties.
The 56,875-square-foot retail center was built in 2002 on 10.3 acres in Cumberland County. The center is 94 percent leased, anchored by Giant Food and Sovereign Bank.
www.omegare.com
The 56,875-square-foot retail center was built in 2002 on 10.3 acres in Cumberland County. The center is 94 percent leased, anchored by Giant Food and Sovereign Bank.
www.omegare.com
Physicians Realty Trust Pays $4.5M for Carlisle MOB
Physicians Realty Trust acquired the Carlisle Outpatient Surgery Center at 19 Sprint Dr. in Carlisle, PA from Property Valuation Services for $4.5 million, or about $340 per square foot.
The single-story medical office building totals 13,245 square feet and is located in Harrisburg Area West submarket of Philadelphia.
www.omegare.com
The single-story medical office building totals 13,245 square feet and is located in Harrisburg Area West submarket of Philadelphia.
www.omegare.com
Wednesday, October 1, 2014
BET Investments Spends $150M on Retail, Student Housing
by Natalie Kostelni Staff writer for Philadelphia Business Journal
BET Investments bought the Abington Shopping Center and a local student housing complex as part of a recent round of $150 million in acquisitions.
Low interest rates has served as one of the big drivers of the acquisitions.
In addition to the local buys, the Horsham, Pa., real estate company that was formed by Bruce E. Toll, also made out-of-state purchases as it expands its geographic footprint. It bought a student housing project in Tampa, Fla., and an apartment property in Northern Virginia.
Closer to home, it paid roughly $16.3 million for the Abington Shopping Center at Old York Road and London Road in Abington, Pa., from a partnership that involved real estate magnate Steve Guttman. The 75,000-square-foot center has a 36,000-square-foot vacancy caused by the closing of a Giant grocery store two years ago.
The center was constructed in the 1950s and is showing its age.
“We’re going to make a substantial investment into the property,” said Michael Markman, president of BET. Some of the upgrades include a new sign and facade. It will also fill most of the Giant vacancy with a national apparel retailer that Markman declined to disclose. A fast-casual food establishment will also move in and struggling existing tenants will eventually be replaced.
What makes this project particularly appealing to BET is both Toll and Markman live in Abington.
“Redeveloping a property in your own neighborhood and making things better is probably one of the most satisfying things you can do,” Markman said. “This is something that has been a real eyesore.”
BET also bought West Chester Commons, a 459-bed student house property at 230 E. Rosedale Ave in West Chester, Pa., for roughly $35 million
Full story: http://tinyurl.com/n222c7a
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E. Kahn Acquires Downingtown Property From Archdiocese
by Natalie Kostelni, Staff writer for the Philadelphia Business Journal
E. Kahn Development Corp. has made two strategic acquisitions that will enhance existing land holdings in its portfolio.
In the largest purchase in terms of dollars and size, the developer paid $3.8 million to buy nearly 50 acres, which sit along Woodbine Road adjacent to the Downingtown Country Club in Downingtown, Pa., from the Archdiocese of Philadelphia. Kahn made the acquisition in partnership with Adam Loew and the Estate of Jack Loew.
The church operates St. John Vianney Center on about 15 acres of the tract and will continue to do so. Eli Kahn said he is still determining what to do with the land.
“This is ground we had been trying to buy for a long time and we’re not exactly sure what we are going to do with it yet,” he said. “We’re going to take our time and figure out what to do with it.”
In the other acquisition, Kahn paid $1.8 million for 144 Lancaster Ave. in Devon, Pa. Beatrice Goldfine and Carole S. Ben-Maimon were the sellers.
Full story: http://tinyurl.com/omdjp2h
www.omegare.com
E. Kahn Development Corp. has made two strategic acquisitions that will enhance existing land holdings in its portfolio.
In the largest purchase in terms of dollars and size, the developer paid $3.8 million to buy nearly 50 acres, which sit along Woodbine Road adjacent to the Downingtown Country Club in Downingtown, Pa., from the Archdiocese of Philadelphia. Kahn made the acquisition in partnership with Adam Loew and the Estate of Jack Loew.
The church operates St. John Vianney Center on about 15 acres of the tract and will continue to do so. Eli Kahn said he is still determining what to do with the land.
“This is ground we had been trying to buy for a long time and we’re not exactly sure what we are going to do with it yet,” he said. “We’re going to take our time and figure out what to do with it.”
In the other acquisition, Kahn paid $1.8 million for 144 Lancaster Ave. in Devon, Pa. Beatrice Goldfine and Carole S. Ben-Maimon were the sellers.
Full story: http://tinyurl.com/omdjp2h
www.omegare.com
Weis Plaza in Kutztown, PA Trades
by Steve Lubetkin, GlobeSt.com
Weis Plaza, 15260 Kutztown Rd., Kutztown, Berks County, PA. traded for an undisclosed amount. Phillips Edison Fund III of Cincinnati, OH was the seller. Nassimi Realty of New York City acquired the property.
Weis Plaza is a 115,359 square-foot shopping center anchored by a 56,614 square-foot Weis Markets and its gas pad. The property, built in 1972, was 77% leased at the time of the sale. Additional retail tenants include Dollar General, Once Again Thrift Store, National Auto Stores and RadioShack.
“Value-added shopping centers, with a grocery-anchor component, still remain in very high demand among all investor classes and continue to draw regional and national interest. The stability of owning a top tier grocer within the tenant mix allows for a premium on rentals, pushing for better appreciation among these demanded assets.”
The property is well located on Kutztown Road (East Main Street), providing excellent local and regional access while serving Kutztown University. The shopping center is within 30 minutes of Allentown and Reading via US Route 222.
www.omegare.com
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