Wednesday, December 30, 2015

Dollar Financial Leases 34,000 SF in Malvern

Dollar Financial Group, Inc. leased 33,892 square feet in the ArborRidge 3 office building at 74 E. Swedesford Rd. in Malvern, PA.

The single-story, 56,128-square-foot property was built in 1958 on 5.2 acres in the Exton / Whitelands submarket of Chester County, part of the ArborRidge business park. The campus includes an amenities center, fitness center, conferencing facilities, cafe and dedicated food truck parking area, located less than 30 miles from the Philadelphia International Airport and Center City Philadelphia.

Dick's Leases 50,000 SF at Cumberland Mall

Dick's Sporting Goods has leased 50,000 square feet at the Cumberland Mall in Vineland, NJ.

The 1.27 million-square-foot super regional enclosed mall was built in 1973 on 110 acres in the Southern New Jersey submarket of Cumberland County, between the Atlantic City and Philadelphia International Airports. Dick's will fill the recently-vacated J.C. Penney anchor space at the mall, which is home to 90 retailers including Boscov's, Burlington Coat Factory, Marshalls, ULTA and Regal Cinemas.

"The addition of Dick's Sporting Goods will improve the merchandise mix and solidify the tenant roster at Cumberland Mall," said Joseph F. Coradino, CEO, PREIT, noting that the transaction demonstrates the firm's continued success in replacing anchors with in-demand retailers. "This transaction cements Cumberland Mall's position as a dominant retail hub in the area and adds to its appeal catering to a wide variety of consumers."

M&J Wilkow, USAA Pay $188M for East Gate Shopping Center

M & J Wilkow Ltd. and joint-venture partner USAA Real Estate Company acquired the East Gate Square shopping center at 1000 - 1690 Nixon Dr. in Mount Laurel, NJ from Equus Capital Partners Ltd. for $188 million, or about $252 per square foot.

The 746,535-square-foot power center was built in six phases between 1992 and 2002 in a densely populated trade area in the North Burlington County submarket of Philadelphia, directly served by I-295 and Rtes. 73 and 38.

Surrounding the separately-owned Moorestown Mall and Home Depot shadow anchor, the center is currently 88 percent leased to more than 60 tenants including Shop Rite, Dicks Sporting Goods, Ross Dress for Less and PetSmart. Almost 90 percent of gross revenue at the center is generated by national and regional credit tenants.

The Fed's impact on commercial real estate (Video)

AION to Acquire 12-property AIG MF portfolio

by Steve Lubetkin,
AIG Global Real Estate Investment has sold a 12-property apartment portfolio totaling 2,811 units located in New Jersey, Pennsylvania and Delaware, the remains of a portfolio it acquired from Kushner Companies in 2007.  The buyer is thought to be New York-based AION Partners in a deal.

 The buyer purchased the portfolio for approximately $165.4 million free and clear of existing debt.  This transaction represents the largest multi-housing sale of 2015 in New Jersey, according to Real Capital Analytics.

In June 2007, Kushner Companies completed the sale of more than 17,500 apartment units in five states to a partnership of AIG and Morgan Properties, King of Prussia, PA. In October 2013, Morgan reportedly bought out AIG and another partner and took sole ownership of about 15,000 units. AIG retained the balance of the units, which would make up the bulk of the transaction announced today.

The well-leased, garden-style communities offer a mix of one-, two- and three-bedroom units averaging approximately 800 square feet in size.  Amenity packages vary by community but include fitness centers, swimming pools, tennis courts, playgrounds and dog parks.  Several of the properties have undergone interior unit upgrades with proven rental premiums.  Seven of the properties are located in New Jersey; three are in Pennsylvania; and two in Delaware.
List of properties:

Tuesday, December 29, 2015

PA Ridge Associates Acquires Independence Press Building

by Steve Lubetkin,
P.A. Ridge Associates is acquiring The Independence Press Building, a vacant 156,000 square foot property at 525 North 11th Street in Philadelphia, PA, for $5 million. Ridge is planning loft-style residential units in the property.

“Continued development along North Broad Street and its adjacent neighborhoods has been well received due to the area’s access to transit, major roadways, and the Reading Viaduct project,” Anthony Palmiotto, the Kislak Company sales associate who represented the purchaser, tells exclusively. “Planned redevelopments of historic properties such as the Independence Press Building and Divine Lorraine Hotel highlight the eagerness of multifamily developers to pursue projects north of Spring Garden Street. It’s exciting to see projects like these help to link the North Broad Street of Center City with the North Broad Street of Temple University.”

Kislak senior vice president Matt Weilheimer represented the seller in the transaction.

The former factory is fully-approved for 92 loft-style residential units with parking. It is located in the rapidly changing "loft-district" neighborhood that has quickly become desirable for millennials and young professionals given its easy access to Center City Philadelphia and area hospitals and universities.

“The seller achieved a price that reflects the strong multifamily market in the Philadelphia metropolitan area,” says Palmiotto. “And the buyer was eager to acquire a historic building that was ready for immediate redevelopment in an up-and-coming neighborhood.”

Monday, December 28, 2015

Brandywine Sells Cira Square, Former Post Office in Philadelphia

by Steve Lubetkin,
Brandywine Realty Trust is selling Cira Square, the former main US Post Office complex in the University City district of Philadelphia for $354 million. It’s the largest of a group of property sales the real estate investment trust announced Wednesday that Brandywine says will generate $389 million.

"The transactions reinforce our stated goals of prefunding our development pipeline and further improving our financial capacity through accelerated dispositions," Brandywine president and CEO Gerard H. Sweeney says. "The sale of Cira Square reflects our ability to both create and harvest value and will generate a significant gain to our shareholders.  We acquired the historic post office building in 2007, embarked on a multi-year renovation of this iconic Philadelphia landmark and rebranded it as Cira Square.  The other asset sales represent our continued efforts to reduce our ownership in non-core assets and markets.”

The five office properties Brandywine is selling contain an aggregate of slightly more than 1.2 million rentable square feet. The Cira Square property totals 862,700 square feet and is 100% leased to the General Services Administration and occupied by the Internal Revenue Service.  Brandywine expects the sale to close in the first half of the first quarter 2016, and says it will use the proceeds to prepay the current mortgage totaling $177.4 million, and the mortgage on the 1,662-space parking garage at the newly constructed Cira Centre South totaling $35.5 million.

After the transaction, Brandywine will continue to provide management services at the Cira Square property.

Brandywine also sold three office properties totaling 196,100 square feet in Carlsbad, CA, for $30.4 million, or $155 per square foot; a 1.6 acre development site at the corner of Second and King Streets in Wilmington, DE, for $6.5 million; and a 158,000 square foot flex/office property in King of Prussia, PA, for $4.6 million, or $29 per square foot.

Brandywine says it expects the transactions to result in a net gain of approximately $96.7 million.  Brandywine expects to use the net proceeds to fund current development commitments, reduce debt and general corporate purposes.

Wednesday, December 23, 2015

Four Falls comes on the market

Natalie Kostelni, Reporter, Philadelphia Business Journal
A year after Arden Group bought Four Falls Corporate Center in West Conshohocken, Pa., for $44.3 million, the Philadelphia real estate investor has decided to put the office complex up for sale and estimates trading it at a premium.

The property consists of two, six-story buildings — 100 Four Falls and 200 Four Falls — totaling 254,000 square feet of office space. CBRE Inc. is marketing it for sale.

During Arden’s ownership, the complex underwent $3 million in renovations.

Constructed in 1987, its lobby, common corridors and exterior were starting to show their age and the market was responding. Tenants found space in other, newer buildings in the same submarket. Four Falls is about 70 percent occupied.

Work was done to its entrance, lobby, elevators and common areas. The Hub, a company that provides meeting and co-working space, leased 8,000 square feet but also uses the building’s atrium and outdoor patio spaces for its use.

Four Falls was a pioneering building when it was constructed.

It essentially kicked off the Conshohocken office market and provided executives who lived along the Main Line something they didn’t have – an office close to home. Tenants who could afford the rent, flocked to it.

The complex went through some rough patches as newer buildings came on the market and when Arden bought it, it was in receivership. Some estimates have it trading this time for around $68 million.

Its sister property across the street, 300 Four Falls, was put up for sale last summer and is under agreement by Hayden Real Estate Investments.
Full story:

Tuesday, December 22, 2015

Keystone Selling Devon Square Office Complex

by Steve Lubetkin,
Keystone Property Group has put a “for sale” sign on Devon Square, a two-building, 140,000-square-foot office complex at 724 and 744 W. Lancaster Avenue in Wayne, PA.

The office buildings, substantially renovated in 2007, are 91-percent occupied with a tenant base including Merril Lynch, Penn Liberty Bank and other leading tenants, including several medical offices. The property is well-amenitized with an adjacent Marriott Courtyard hotel and is walkable to several restaurants and retail options.

“Devon Square will prove highly desirable to both high-net-worth individuals and institutional investors interested in acquiring one of the most desirable office properties on the Main Line,” says Jessica Jacobs, Keystone Property Group asset manager. “This area is one of the strongest submarkets for office leasing in the Philadelphia region, and with its low vacancy rate and an average remaining lease of five years, Devon Square will provide the buyer with an extremely appealing investment opportunity.”

Situated on Route 30, the property is located in a highly desirable in-fill location and provides its tenants with easy access to roadways and mass transit. The property is located adjacent to Devon Square Shopping Center, and within minutes of I-76, I-476, Route 202, and SEPTA train lines. Across Lancaster Avenue from Devon Square is Devon Village, a shopping center anchored by Whole Foods.

Liberty Exiting Non-Core Suburban Office

by Steve Lubetkin,
Liberty Property Trust will reposition its portfolio through planned sales of approximately 8.5 million square feet of suburban office properties. Liberty CEO Bill Hankowsky says the REIT expects this sale strategy to enable it to report funds from operations for 2016 in the range of $2.35-$2.55, with timing of the sales contributing to the wider range.

The company reaffirmed its previously announced expectation to report FFO per share for 2015 in the range of $2.66-$2.69.

“In 2013, Liberty set in motion a five-year strategic plan for transforming our company to one that can take full advantage of changes in how business utilizes real estate, and fully devote our unique development, leasing and management talents to higher-value opportunities,” says Liberty’s chief executive officer, Bill Hankowsky. “As we approach 2016, we can see the conclusion of this transformation being completed. Our intent is to sell most, if not all, of our remaining non-core suburban office product. The result will be a Liberty footprint comprising our US and UK industrial platform plus a value-add focused office platform in four markets.”

Proceeds from asset sales will be used to fund Liberty’s growing development pipeline and potential acquisitions. Liberty expects to start $500-$700 million in new development projects in 2016. Expected results also reflect occupancy and rental growth in the company’s industrial portfolio, contributing to continuing positive performance in the company’s same store group of properties.

Liberty also reported on several highlights of fourth quarter 2015 activity.

Fourth quarter development starts (wholly owned) comprise five projects for $108 million. The projects total 669,000 square feet and are 49% pre-leased.
Fourth quarter acquisitions are expected to total $11 million and consist of one vacant 198,000 square foot distribution building in Shakopee, MN.
Fourth quarter dispositions to date total $300.3 million of suburban office and non-core industrial properties totaling 4.1 million square feet.
Liberty announced it has leased a 345,000 square foot office building in Eden Prairie, MN, representing the company’s largest single office vacancy.
“We are fortunate to be operating in a very strong environment, particularly for industrial real estate,” says Hankowsky. “We have experienced tremendous activity in nearly every industrial market during the fourth quarter, and we are also seeing remarkable interest by high-quality companies seeking to locate at The Navy Yard in Philadelphia, Rio Salado in Tempe, and our planned Camden Waterfront office project. This activity gives us a great deal of confidence in 2016.”

Thursday, December 17, 2015

Courtyard by Marriott Portfolio Sells for $52M

Marriott International, Inc. sold a multi-state portfolio of six net-leased hotels to real estate investment trust W.P. Carey, Inc. for $52 million, or about $67,000 per key.

Totaling 771 rooms, the 478,106-square-foot portolio includes hospitality buildings in North Carolina, New Jersy, Texas, Missouri, Iowa and Lousiana. All of the properties are operated by Courtyard by Marriott, a wholly-owned subsidiary of the Marriott brand.

"The acquisition of the Courtyard by Marriott portfolio presented the opportunity to acquire six established operating properties with strong performance at an attractive basis, offering compelling risk-adjusted returns," commented Jason Fox, head of global investments and president of W. P. Carey. "The steady, predictable cash flows and annual rent escalations, coupled with the strength of Marriott International's brand and credit made this an ideal addition to the W. P. Carey Inc. portfolio."

Wednesday, December 16, 2015

Exeter Property selling portfolio in $3B deal

Natalie Kostelni, Reporter, Philadelphia Business Journal
Exeter Property a Plymouth Meeting, Pa., real estate firm, is poised to sell its industrial portfolio in a deal valued at $3 billion.
The transaction, first reported in PERE newsletter, is scheduled to close next week. The buyer for the firm’s 55 million square feet of industrial space is Abu Dhabi Investment Authority and PSP Investments.
The properties were acquired with the first two funds that Exeter raised. The company deployed that money to buy more than $2.6 billion in properties between 2007 and 2014.

The report from PERE said that the transaction involves the properties to “be rolled over into a new core vehicle that will continue to be managed by Exeter. The firm will maintain a small stake in the assets but the vast majority of the interest will be held by ADIA and PSP. The core vehicle, however, will be unrelated to Exeter’s second industrial core fund, Exeter Core Industrial Club Fund II, which the firm is currently marketing.”

Ward Fitzgerald, president and chief executive of Exeter, declined to comment on the report.
The deal ranks among some other mega industrial transactions completed this year and is one of the biggest involving a Philadelphia area real estate firm. Among the other mega industrial portfolios that traded this year involved Blackstone Group completing an $8 billion sale, Prologis in a $5.9 billion acquisition and Industrial Income Trust selling its properties for 4.5 billion.

Full story:

Azavea Relocating in Philadelphia

Geospatial analysis (GIS) firm Azavea, Inc. signed a lease for 22,000 square feet at 990 Spring Garden St. in Philadelphia, PA.

Azavea will be relocating from its current space at 340 N. 12th St. in March to occupy a full floor in the Spring Garden Office Plaza.

Built in 1920 as an industrial building, it was renovated in 1998 and converted to a 160,000-square-foot office building. The property is just steps from the Reading Viaduct "Rail Park" project and a short walk to Chinatown and Reading Terminal Market.

Tuesday, December 15, 2015

Owning Real Estate Projects with Crowdfunding? (Video)

Procida Bullish on Philadelphia CRE Investments

by Steve Lubetkin,
Procida Funding & Advisors founder William "Billy" Procida remains highly enthusiastic about its investments in Philadelphia, having capped the third quarter with the $35-million construction financing for the restoration of the iconic Divine Lorraine Hotel on North Broad Street.

Procida’s 100 Mile Fund reported 16.02% annualized percentage yield for investors for the third quarter of 2015.  Since inception in November 2011, the 100 Mile Fund has closed on over $280 million in loan originations throughout New York, New Jersey and Pennsylvania.

The Divine Lorraine project has stirred enormous community excitement in Philadelphia, where hopes for restoration of the unusual structure have been high on the city’s wish list for decades.

“Did you know that 7,000 people showed up at the groundbreaking?” asked William “Billy” Procida in an exclusive interview with “In 35 years—and I’m big on groundbreakings—I think I had one or two where there was a hundred people. People waited on line for two hours to go in the building to see our exhibit.”

His other major financing project in Philadelphia, the Mural Arts Lofts, was fully leased before it opened.

“Construction, which we thought was going to be 18 months, finished in ten,” he says. “We thought it would take six to nine months to lease, and it leased before we even got a CO, so we are excited about that whole North Broad marketplace right now.”

Philadelphia remains both attractive aesthetically and financially, Procida says. “It’s twice as nice and half the price of New York,” he says. He points to the American Bible Society, which sold its headquarters at Columbus Circle in New York after being there for 100 years.

“They had enough money, they could have gone anywhere, they picked Philadelphia,” he says. “The Pope picked Philly [for his recent US visit], the Democratic Party picked Philly [for its convention in 2016], it’s just a great city.”

Procida, who describes himself as “a lifelong New York City developer,” says it’s “hard to walk down the street now in Manhattan.”

“If you go to Rittenhouse Square and sit at a sidewalk café, you can actually see Rittenhouse Park,” he says. “If you go to a sidewalk café in New York, all you see is Yellow Cabs.”

Procida is also financing several other projects in Philadelphia, including a $1.2 million bridge financing for a mixed-use building. He also believes the economically disadvantaged city of Paterson, NJ, where he says he has made $40 million in investments, has need of his financing expertise.

“I’ve got this new philosophy, don’t do what people want to do, do what needs to be done,” he says. “In the seven years I’m in Paterson, I’m making 15 percent on every dollar I have on the street, and I’m doing good work that needs to be done. We don’t need another skyscraper, we don’t need another shopping mall, what we need to do is finish what is supposed to be done.”

TL Management Acquires Spring Creek Rehab Center in Harrisburg

by Steve Lubetkin
Brooklyn, NY-based TL Management has acquired Spring Creek Rehabilitation and Health Care Center in Harrisburg, PA. Spring Creek, which has been in greater Harrisburg for more than 100 years, is a 404-bed rehabilitation and healthcare center which includes both short-term rehabilitation and long-term care facilities.

TL Management financed the acquisition with a $48 million credit facility arranged by First Niagara Bank.

"It was a pleasure to work with First Niagara to secure funding that provides us with the resources needed to continue to grow while maintaining the highest quality of care for our customers across all of our senior care facilities,” said Ben Reisman, vice president of corporate finance for TL Management.

TL Management owns more than 100 skilled nursing facilities around the country.

Friday, December 11, 2015

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Industrial Property Trust Buys Fully Leased Industrial Building

Industrial Property Trust acquired the industrial building at 515 N. Zarfoss Dr. in York, PA from Endurance Real Estate Group and Thackeray Partners for $16.5 million, or about $53 per square foot.

The 312,769-square-foot property currently is occupied by former governor Thomas Wolf’s kitchen and bath cabinetry company through 2021.

Industrial Inspection and Insurance Issuer Renews Lease at Bay Colony Exec Park

The Hartford Steam Boiler Inspection and Insurance, the countries oldest company devoted primarily to industrial safety, renewed its lease of 27,693 square feet in the 595 Bay Colony office building at at 595 E. Swedesford Rd. in Wayne, PA.

The three-story, 81,890-square-foot office building was constructed in 1988 on 6.6 acres in the King of Prussia / Wayne submarket of Chester County, within the Bay Colony Executive Park.

Wednesday, December 9, 2015

MANNA Moving to Rodin Place

by Steve Lubetkin,
Metropolitan Neighborhood Nutrition Alliance, a nonprofit hunger relief organization, signed a long-term lease in approximately 23,230 square feet of office space at Rodin Place, 2000 Hamilton Street, Philadelphia.

The contract that has an aggregate value of approximately $7.7 million.

MANNA is a private, not-for-profit service organization that links the food industry with 248 partner agencies and is a member of Feeding America, the nation's largest domestic hunger relief organization. The group is moving its office from 2323 Ranstead Street to the second floor of Rodin Place in the summer of 2016 and will use the space for administrative functions, as well as to prepare and deliver meals.

SAS Regency Sells Bensalem MF to Wessex First Avenue for $20M

by Steve Lubetkin,
Wessex First Avenue Associates has acquired Regency Apartments, a 253-unit, garden-style multi-housing community in Bensalem, PA, from owner SAS Regency for $19.75 million.

“The buyer pool was extremely diverse and we have had success importing capital from outside Philadelphia into the region. Investors continue to target Philadelphia based on strong fundamentals and the ‘flight-to-yield’ theory in comparison to the New York, New Jersey and Washington, DC markets.”

Wessex First Avenue Associates purchased the property free and clear of existing debt.  New debt was arranged for $15.472 million, seven-year, 75 percent, fixed-rate loan through a regional bank for the new owner.

Regency Apartments, 2049 Brown Avenue, is less than one half of a mile from the intersection of Street Road (Route 132) and Hulmeville Road (Route 513) and is less than two miles from Interstate 95, providing access into Philadelphia and New Jersey.  The property is flanked by Bensalem Plaza Shopping Center and Bensalem Township Country Club and is a short distance from Philadelphia Mills and Parx Casino and Race Course.  The community has seven, three-story residential buildings housing a mix of studio, one- and two-bedroom units averaging 774 square feet each centered around a courtyard with swimming pool.

Brandywine Breaks Ground on New Camden HQ

Brandywine Realty Trust has broken ground on Subaru of America's new 250,000-square-foot headquarters building on Admiral Wilson Blvd. in Camden, NJ.

The 10-story facility will be double the size of the property Subaru now occupies in Cherry Hill. The New Jersey Economic Development Authority (NJEDA) had granted Subaru $118 million in tax credits to move from Cherry Hill.

The Gateway Office Campus is owned by Campbell Soup Company. Brandywine Realty Trust is developing the building, expected to deliver in April 2017. Rick Widerman and Ron Cariola with JLL brokered the lease deal with Subaru.

Tuesday, December 8, 2015

Inverness Apartments Sold Again, This Time for $27.3M

by Steve Lubetkin,
The Inverness Apartments in Westville, Gloucester County, NJ have been sold in an off-market transaction for $27.3 million.

“The market for multifamily properties remains very strong throughout New Jersey and the region,” says Robert Holland, president. "The purchaser was eager to acquire such a large and well-performing property in suburban Philadelphia.”

The 368-unit property includes 256 one- and 112 two-bedroom garden-style apartments in 45 buildings on 31.6 acres. The property is located near public transportation, schools, and shopping. Amenities include an on-site clubhouse, pool, tennis court, and laundry facilities.

The units are fully-equipped with modern kitchens, central air-conditioning, separate dining rooms, large closets, 24-hour emergency maintenance, and either balconies or patios. Select units also include fireplaces. Over sixty percent of the tenant HVAC units have been replaced over the past two years. Siding and windows were replaced in 1999.

“The asset appreciated over 250%,” since the last sale in 1999.  This is a classic example of owners applying strong management principles to generate increased value.”

“We are seeing an influx of New York-based investors and purchasers in New Jersey that see the opportunities in the multifamily market."

Monday, December 7, 2015

Prime Group in $5.4M Deal for Suburban Philadelphia Self-Storage

by Steve Lubetkin,
Saratoga Springs, NY-based Prime Group has purchased Riverline Self Storage, a 381-unit self-storage facility located in the Philadelphia suburb of Cinnaminson, NJ, for $5.4 million.

The seller was a local private investor.  Prime purchased the asset free and clear of existing debt. Prime and its affiliates, including Rochester, NY-based Morgan Management, own approximately $2.8 billion of commercial real estate, including more than 3.6 million square feet of self storage facilities, about 25,000 apartment units and other real estate holdings.

Riverline Self Storage’s two buildings on 4.5 acres at 1714 Bannard Street, in the northern part of Cinnaminson, total 63,539 rentable square feet.  The property’s 381 climate-controlled units total 36,586 rentable square feet and occupy portions of both two-story buildings.  The remaining 26,953 rentable square feet is occupied by a combination of office, retail and warehouse tenants.  The property is located near the Tacony-Palmyra and Betsy Ross bridges and serves the communities of Cinnaminson, Delran, Riverton and Palmyra.

Liberty Property Trust Sells Horsham Office/Flex Portfolio for $245M

Liberty Property Trust has exited the Horsham, PA submarket, closing the sale of its entire portfolio of 41 office and flex properties to privately held Workspace Property Trust (WPT) for $245.3 million

The portfolio in Horsham, located 10 miles north of downtown Philadelphia, totals 2.4 million square feet of existing space and 20 acres of development land. The portfolio was 84.3% leased at closing.

The deal is the first major transaction by Workspace Property Trust, which specializes in the development, management, and operation of office and flex space in the Northeast. The company is led by former Mack-Cali Realty CEO Thomas A. Rizk.

WPT partnered with Rizk Ventures, Forum Partners, JMP Group and EverWatch Capital in the transaction, financed with a $200 million loan provided by JPMorgan Chase Bank, N.A. and arranged by HFF's New York City debt placement team.

The sale brings Malvern, PA-based Liberty’s 2015 dispositions to date to a total of $536 million.

Thursday, December 3, 2015

Comcast Expands at Voorhees Tech Center

Comcast Corporation signed a lease to expand its presence at 401 White Horse Rd. in Voorhees, NJ by an additional 42,000 square feet. Beginning in early 2016, the tenant will occupy 150,000 square feet in the office building.

The 208,215-square-foot Vorhees Tech Center Bldg 1 was constructed in 1971 on 26 acres in the South Camden County submarket of Philadelphia. There is still 35,000 square feet available for lease there.

TJM Pays $15M for Radisson Philadelphia Northeast

TJM Properties, a Florida-based property investment and development firm, acquired the 274-room Radisson Philadelphia Northeast hotel at 2400 Old Lincoln Hwy in Trevose, PA from Haverford Hotel Partners LP for $15 million, or about $55,000 per keycard.

The six-story, 205,011-square-foot hospitality building was constructed in 1974, located 30 miles from the Philadelphia International Airport.

Dunn Twiggar Sells Exton MOB for $6.8M

Dunn Twiggar Co., DTC 479 TJW LP sold 479 Thomas Jones Way in Exton. The 49,264 s/f medical office building was purchased for $6.85 million. The buyer was Posh Properties in the sale. Major tenants include: Mainline Hospitals, Chester County, and Brandywine Hospital.

Tuesday, December 1, 2015

Keystone Redeveloping Plymouth Meeting Office

by Steve Lubetkin,
Keystone Property Group will redevelop One Plymouth Meeting, an iconic, 180,000-square-foot office property at 502 West Germantown Pike in Plymouth Meeting, PA.

Located at the recently reinvigorated Plymouth Meeting Mall, the nine-story building will be reimagined to reflect modern workplace demands with new amenities, a completely redeveloped interior and exterior, and LEED certification.

“One Plymouth Meeting is an ideal headquarters facility for forward-thinking companies intent on providing their employees with a wide range of lifestyle amenities in proximity to their office space,” says Rich Gottlieb, partner at Keystone. “With walkable access to nearly a dozen restaurants, Whole Foods, and the onsite movie theater at Plymouth Meeting Mall, the reimagined One Plymouth will be the sort of dynamic office property that will engage employees as it inspires creative thinking.”

Keystone’s redevelopment plans include adding a modern glass and precast exterior, all new mechanical and electrical systems, a modern lobby and a private outdoor gathering space. With the installation of larger windows, the comprehensive capital improvements campaign will increase the building’s energy efficiency and tenants’ interior experience. Keystone says it will work with tenants on customizing the renovated building to suit their specific needs.

“With efficient floor plates, high ceilings, abundant parking and signage potential, the building has amazing exposure and a great deal of versatility,” says Gottlieb. “Once we unlock its full potential, One Plymouth will cement its status as a modern landmark that brings energy to the workplace and fosters productivity and collaboration. As the mall continues its revitalization, One Plymouth will maintain its role as a significant commercial driver in the surrounding region.”

Located in southern Montgomery County, just 20 minutes from Center City, the redevelopment of One Plymouth Meeting will be the latest in a series of major enhancements made in the region that include the renovations at the mall and development of a 398-unit luxury residential property less than two miles away.

Saul Ewing Leases 15,000 SF in Wilmington

Wilmington-based Saul Ewing LLP, a full-service law firm, has signed a lease to take 15,227 square feet at 1201 N. Market St. in Wilmington, DE.

The 23-story, 441,341-square-foot, 4-Star office property was built in 1988, designed by Skidmore, Owings, and Merrill.

Saul Ewing will take over more than half of the 23rd floor, joining the likes of law firm Morris Nichols and Arsht and insurance company Nuclear Electric Insurance.

Retail's New Brick-by-Brick Approach to Real Estate (Video)

Monday, November 30, 2015

Gloucester Premium Outlets, Simon Properties, Adds Two New Retailers

by Steve Lubetkin,
Gloucester Premium Outlets says two new retailers have opened at the South Jersey outlet shopping destination, which itself just opened in August.

Gap Factory and Old Navy Outlet opened this month in the Mill Court section of the property..

These new tenants join existing retailers including Armani Outlet, Calvin Klein, Carter’s, Cole Haan, Columbia Sportswear, Crocs, J.Crew, Levi’s Outlet Store, Nike Factory Store, Puma, Steve Madden, Under Armour and Vera Bradley.

“The opening of these two popular retailers comes at the perfect time: right before the start of the busy holiday season,” says Shannon Palzer, director of marketing and business development for Gloucester Premium Outlets. “We now have even more dynamic brands for our customers to discover and enjoy and we are confident that both brands will be well received.”

Gloucester Premium Outlets features 90 outlet stores. The property is owned by Simon Property Group.

Wednesday, November 25, 2015

York Industrial, 515 Zarfoss Drive, Sold For $16.5M

by Steve Lubetkin,
Endurance Real Estate Group and Thackeray Partners have sold the 313,000 square-foot 515 Zarfoss Drive in York, PA, to Industrial Property Trust for $16.5 million. The property is located in the 27 million square foot Central Pennsylvania industrial market, which is widely considered one of the top performing in the United States.

“515 Zarfoss Drive presented the opportunity for the buyer to acquire a 100 percent leased, highly-functional asset with a tenant who has an unmatched local presence and commitment to the market." “York County has continued to be a shining star within the Central Pennsylvania market, outperforming other locations in terms of high quality of labor, rental rates and limited vacancy.”

Central Pennsylvania remains an attractive industrial market for investors due to its  superior regional connectivity within a one-day drive of New York, Philadelphia, Baltimore, Washington, DC, and Pittsburgh. The York County market has emerged as one the most highly sought after locations within the Central Pennsylvania market due in part to its close proximity to Harrisburg, strategic location along I-83 and high quality labor.

Monday, November 23, 2015

Endurance Real Estate Group Refi's $28M on 2 Horsham Warehouses

by Steve Lubetkin,
Endurance Real Estate Group $28 million refinanced two fully-leased industrial shallow bay warehouse and office buildings totaling 246,790 square feet in the Philadelphia suburb of Horsham, PA.

It is a 10-year, fixed-rate loan through Silverpeak Real Estate Finance.  Loan proceeds will refinance existing debt.

The 100-percent-leased portfolio consists of 200 Precision Drive and 425 Privet Road in the Pennsylvania Turnpike Corridor in Horsham, 19 miles north of Philadelphia’s CBD.  The properties are adjacent to one another and are approximately three miles from Interstate 276 (Pennsylvania Turnpike) via exit 343, which provides access to Interstates 76, 476 and 95.

The 126,500-square-foot 200 Precision Drive contains 63,000 square feet of warehouse space, 49,400 square feet of office space and a 14,200-square-foot laboratory.  The building is housed on 11.13 acres and is leased to Finisar Corporation, C&D Technologies and DrugScan.  Fully-leased to Teva Pharmaceuticals, 425 Privet Road underwent an expansion in 2008 to expand the asset to its current-day 120,290 square feet.  Situated on 13.1 acres, the property contains 615 parking spaces.

Friday, November 20, 2015

Rents Rising, Availability Tightening in Philadelphia Office Market

by Steve Lubetkin,
Asking rents for Center City Philadelphia office space have risen nearly four percent year over year, while availabilities have declined by 2.2 percent. Overall leasing grew to 3.3 million square feet in the quarter, up 13 percent from the prior period, and class A trailing volume of 2.2 million square feet was up 40.2 percent for the quarter and a solid eight percent for the year so far.

“Everybody here is pretty excited about the direction the city is going in. There have just been a number of firms that have moved to the city, and the construction that’s happening. The downtown atmosphere is completely changed.”

Availability of suburban class A space dropped to 16.7 percent from 17.9 percent in the quarter. In Center City, the class A availability dropped to 11.8 percent. Both Center City and suburban areas recorded their lowest class A availability since the end of 2008, and that flight to quality office space is leading to the rising rates.

“The most significant thing you are seeing is the breakdown in pricing among buildings, where trophy class buildings have seen some significant price increases, relative to the lower end of the class A market and the class B market, which has largely been flat for the last decade,” says Garberson.

The redevelopment of the Gallery retail mall, and the nearby Market East development nearby, are moving rents in the East Market area higher. Once the Marketplace Design Center announced its move to the new Market East project in The Annex Building, other properties in the area being redeveloped have increased their rents, he says.

“There’s a lot of confidence in that part of the city among landlords right now,” he says.

The redeveloped Navy Yard in South Philadelphia got a boost last week with funding announced to study extending the Broad Street subway line to the complex. Garberson thinks the project will need more mass transit if it is to continue to grow. Earlier this year, Axalta announced a 175,000 square-foot R&D center being built with Liberty Property Trust.

“If they continue with their plans, and they’re going to include residential at the Navy Yard, they’re going to need it. It’s a very mass transit-based downtown area, so they need it if they want to compete with Center City or West Philly.”

Traffic has started to become an issue at the Navy Yard, whose weekday population has swelled to about 10,000 and could grow by another 5,000.

In University City, Garberson says, “I think you see a majority of the construction happening there,” noting that the former University City High School has been demolished and the five acre site is being redeveloped by Drexel University City Development, a joint venture between Drexel University and Wexford Science & Technology.

Thursday, November 19, 2015

Richard LeFrak: Golden age of Apartment Investing (Video)

Power Home Remodeling Leases 105,000 SF at The Wharf

Power Home Remodeling Group signed a five-year lease for 104,661 square feet at The Wharf at Rivertown - Building 1 located at 2501 Seaport Dr. in Chester, PA.

The six-story, 398,000-square-foot, 4-Star office building was constructed in 1916 on 1.5 acres in the Delaware County submarket of Philadelphia. The waterfront property was renovated in 2004 and features a fitness center and food court.

Wednesday, November 18, 2015

Wells Fargo Monthly Economic Outlook – November 2015 (Video)

HGI Pays $89.5M for The Grand Cherry Hill Apts

Eurohypo AG New York and AREA Property Partners sold the 565-unit The Grand Cherry Hill Apartment Homes at 1900-1920 Frontage Rd. in Cherry Hill, NJ to Harbor Group International (HGI) for $89.5 million, or about $158,000 per unit.

The 18-story, 600,000-square-foot high-rise consists of studios, one-, two-, and three-bedroom units across two towers, each with its own fitness center. The multifamily property was built in 1969, renovated in 2009 and was 94 percent occupied at the time of sale.

Tuesday, November 17, 2015

Allen Distribution Fully Leases Building

by Steve Lubetkin,
Allen Distribution, a third-party logistics service provider based in Central Pennsylvania, signed a 321,333 square-foot lease for an entire building at Woodmont Industrial Partners' Capital Logistics Center.

"Allen Distribution was particularly attracted to the Capital Logistics Center given its central location in the Harrisburg market and Ownership's ability to accommodate their overall sizing need."

The building at 100 Capital Lane. is part of the recently-renovated Capital Logistics Center, a six-building, 1.55-million-square-foot industrial complex situated on more than 100 acres in Middletown, PA. A joint venture of Woodmont Industrial Partners and AEW Capital Management, the property features an adhered EPDM roof and 7-inch un-reinforced concrete floor with 54 doors with 33 knock-out panels.

“The Capital Logistics Center is truly one of the most modern, highly sought-after industrial parks in the region,” says Eric Witmondt, chief executive officer of Woodmont. “Strategically located in Central Pennsylvania, the complex is ideal for companies that operate distribution lines in the Northeast and Mid-Atlantic.”

In addition to the upgrades at 100 Capital Lane, Woodmont recently completed the redevelopment of 200 Capital Lane, a 400,060-square-foot building that is currently available for lease. The building features include 54 dock doors, two drive-in doors, T5 lighting with motion sensors, a six-inch reinforced concrete floor and a standing seam metal roof. The site also includes 200 car parking spaces and 81 trailer drops, both with potential to expand.

“Woodmont Industrial’s redevelopment of the Capital Logistics Center has been a key factor in attracting long-term tenants to the property. Companies of all sizes can capitalize on the opportunity to lease space at 200 Capital Lane, which is the largest building in the Capital Logistics Center.”

Situated in Central Pennsylvania at the heart of the I-81 Distribution Corridor, the Capital Logistics Center fronts the Pennsylvania Turnpike and is less than a mile away from Harrisburg International Airport. The property is also near local FedEx and UPS facilities as well as Routes I-283, I-83 and 322.

PREIT Announces New Tenants in Moorestown Mall

by Steve Lubetkin,
PREIT has added 40,000 square feet of new leases for the Moorestown Mallin this Burlington County, NJ, suburb of Philadelphia, as part of a redevelopment that PREIT CEO Joseph Coradino calls a successful effort to "unlock the mall's value while giving shoppers an enhanced shopping experience."

An extensive remerchandising of the property has been underway since 2012. The company also marked the completion of the planned overhaul of the Dining Court, redesigned to offer an upgraded environment and amenities.

"I'm pleased to mark these accomplishments and to see the continued evolution of Moorestown Mall," says PREIT CEO Joseph F. Coradino.  "This project is yet another example of PREIT's success in improving the quality of our portfolio and strengthening asset value through targeted property-level remerchandising strategies."

The flurry of leasing activity counteracts some of the fallout from the recently announced early exit of a high profile dining establishment at the retail venue.

Last month, Osteria, an upscale dining establishment from popular Philadelphia chef Marc Vetri, announced it had negotiated an early end to its lease and would close November 21 after a two-year run in the mall. It will be replaced by Catelli Duo, which already has a location at the nearby Voorhees Town Center at Echelon, Voorhees, NJ.

PREIT named the following new tenants at Moorestown: Yard House (9,972 square feet) , a restaurant and beer pub; Starbucks Coffee (283 square feet); Liberty Supply Co. (1,447 square feet), a new retail concept featuring US-made apparel, footwear, bags and accessories for men and women; Toy Genius (3,000 square feet), selling toys, games, puzzles and ride-ons, for shoppers “age 0 – 99”; Eye Deals (1,298 square feet), a one-hour vision center; Yankee Candle (1,195 square feet), selling premium scented candles and home fragrance products; Verizon Wireless (1,869 square feet). Earlier, PREIT signed Swedish clothing store H&M to an 18,355 square foot lease.

Other food options added to the mall this fall include Moon Dog Café, Brooklyn Pizza, Suki Hana Japan and Suki Hana Sushi.

Monday, November 16, 2015

RAIT Financial Trust moving back to Center City Philadelphia

Natalie Kostelni, Reporter, Philadelphia Business Journal
RAIT Financial Trust has signed a lease to move out of Cira Centre and will relocate back to the Central Business District.

The real estate investment trust signed on to 21,000 square feet at Two Logan Square in Center City Philadelphia. It will move by spring 2016, said Andres Viroslav, a spokesman for the company.
“We wanted to be back downtown,” Viroslav said about the decision to move out of Cira Centre. It also wanted to have the ability to be on a single floor. Viroslav declined to answer additional questions about the lease.

The building that RAIT is relocating to 100 N. 18th St., owned by Brandywine Realty Trust, which developed and also owns Cira Centre. The vacancy brought on by RAIT's pending move from Cira was short-lived.

“Always good to keep a great customer within the Brandywine family,” said Jerry Sweeney, CEO of Brandywine (NYSE: BDN) about RAIT's move. “We have already released their entire space plus some more for a term exceeding 10 years.”

Full story:

Should my company use a tenant rep agent when leasing office space? (Video)

Friday, November 13, 2015

New Planet Fitness Coming to Nazareth

Planet Fitness has signed a 25,776-square-foot lease at 859-865 Nazareth Pike in Nazareth, PA. The 10-year deal will commence in the first quarter of 2016.

The single-story retail strip totals 182,515 square feet and was built in 1990 in the Lehigh / Northampton submarket of Philadelphia.

The landlord is Lavipour & Company.

Circle Industrial Buys Amazon Bldg for $91M

Circle Industrial acquired the Amazon distribution building at 560 Merrimac Ave. in Middletown, DE from Duke Realty LP for $91 million, or about $90 per square foot. 

Duke developed the 1.02 million-square-foot building in 2013 as a build-to-suit for Amazon, which occupies the entire property on a triple-net lease. The property features 120 loading docks and two drive-ins, and is located on 73.9 acres in teh NEw Castle County Industrial submarket of Philadelphia.

CRE Deal Tracker

by Steve Lubetkin,
In this deal-tracker roundup, a law firm and two nonprofits expanded their office space, and an upscale Italian restaurant cooked up a plan to move into a new King of Prussia location.


PHILADELPHIA—Three lease agreements for approximately 9,432 square feet went off in Center City office space with a combined aggregate rental of $1.23 million. O’Brien Rulis Bochicchio leased of about 5,182 square feet on the 15th floor of 1515 Market Street for the expansion of its offices in the 20-story, 500,000 square foot building.  The building owner is BRI1866 1515 Market. At 1211 Chestnut Street, the Philadelphia Center on Alcoholism leased 2,250 square feet that relocates the PCA from 1501 Cherry Street. The building owner is 1211 Chestnut Realty Corporation.  The Peggy Browning Fund, which is moving to 2,000 square feet on the 12th floor of the Land Title Building, 100 South Broad Street, from approximately 1,000 square feet the Fund currently occupies at 1528 Walnut Street. The building owner is LTD Limited Partnership.

KING OF PRUSSIA, PA—Davio’s Northern Italian Steakhouse is leasing a new 9,000 square foot restaurant at The King of Prussia Town Center, a new 400,000 square foot retail and dining destination in King of Prussia, PA. With locations in Philadelphia, Boston, New York City, and Atlanta, Davio’s will join other signature restaurants at the center, including Fogo De Chao, Paladar Latin Kitchen, Old Town Pour House and Honeygrow. All of these restaurants are slated to open in the third quarter of 2016.

Thursday, November 12, 2015

KoP Town Center gets healthy fast-casual chain

Kenneth Hilario, Reporter, Philadelphia Business Journal

Another restaurant tenant has been added to the King of Prussia Town Center's repertoire of culinary offerings.
Healthy fast-casual chain b.good has signed a lease for 2,400 square feet of space in the upcoming 400,000-square-foot Town Center by Chevy Chase, Md.-based developer JBGR Retail. The restaurant will have 50 seats.

b.good has locations along the East Coast, including Maine and South Jersey. The King of Prussia location is its 28th location and only its second location in the Philadelphia suburbs. (A location in Wynnewood, Pa., opened earlier this year.)
The King of Prussia Town Center outpost of b.good is under construction and will open in summer 2016.

b.good will join other dining tenants, including Davio's Northern Italian Steakhouse's second Philadelphia outpost, Philadelphia-based honeygrow, Fogo de Chao, Old Town Pour House and Paladar Latin Kitchen & Rum Bar.

Phila. coalition puts out national call for innovative health care ideas
JBGR told the Philadelphia Business Journal earlier that it's strategically choosing the type of restaurants coming to the town center. Senior Vice President of Development Tom Sebastian said they will help create "the downtown for Upper Merion," similar to what Center City has become for Philadelphia.

JBGR Retail broke ground on the King of Prussia Town Center in May and is being built in one phase. The entire project is about 50 percent built, Sebastian said.
The first tenant will open in early summer; the whole project will be up and rolling by the end of the summer, Sebastian said earlier. The town center is expected to have 35 to 40 tenants.
"We're really excited about the project," he said. "It's going to be well received by the community. We think it will be unique in the Philadelphia suburbs."
Full story:

Wednesday, November 11, 2015

Will U.S. Jobs Report Impact Real Estate? (Video)

Main Line Health Renews Lease for 72,000 SF in Broomall

Main Line Health Center, a primary care provider, renewed its lease for 71,932 square feet in the Lawrence Park Shopping Center at 1991 Sproul Rd. in Broomall, PA.

The 353,000-square-foot community shopping center was built in 1972 on 106.8 acres in the Delaware County submarket. Located less than 15 miles from the Philadelphia International Airport, the center is anchored by Acme Market, Barnes & Noble, CVS, and Dollar Tree.

Brandywine Opens Green Space Above Cira Centre South

by Steve Lubetkin,
Brandywine Realty Trust has opened Cira Green at Cira Centre South, the City's first elevated park, in the University City district of Philadelphia, PA.  Cira Green, part of Brandywine's 2.7 million square foot mixed-use Cira Centre South neighborhood, is a 1.25 acre urban park, 95 feet above street level overlooking the Center City and University City skylines as well as the Schuylkill River.

Cira Green “will become one of the City's most unique and celebrated public spaces," says Gerard H. Sweeney, president and chief executive officer.  "Our design mission in developing Cira Centre South has been to establish a new neighborhood lifestyle in one of the region's fastest growing districts.  Cira Green will perfectly complement the vibrant residential, retail and office environment that Cira Centre South presents to the marketplace."

Cira Green is designed for enhanced storm water performance, while functioning as an accessible and exciting gathering place.  This project is the City's first to utilize innovative "blue roof" and "green roof" technologies and provide the same hydrological performance as a fully planted roof.  In addition, large portions of the roof deck are tilted and elevated to provide better views of the cityscape.

Cira Green is another green public space created by Brandywine as part of its Cira Southdevelopment. In October 2014, Brandywine completed the Schuylkill Esplanade, a pocket park located along Schuylkill Avenue between Market and Chestnut Streets that serves the dual purpose of managing storm water runoff and providing pedestrians, office workers, and residents of Cira Centre South with a lush green oasis for daily enjoyment.

Adjacent to Cira Green is FMC Tower at Cira Centre South – Philadelphia's first vertical neighborhood –  a progressively designed urban mixed-use high-rise building comprised of highly efficient office space, luxurious residential units, flexible stay corporate suites, and world class amenities.

Conveniently accessible to mass transit via 30th Street Station, this "Vertical Neighborhood" is designed to provide complete convenience in living, working, and relaxing. In addition to its proximity to Cira Green, residents and tenants of FMC Tower at Cira Centre South will enjoy concierge services with unique amenities including a 72 foot pool, world class fitness center, multi-media theater, business conference center, private dining rooms, golf simulator, lounge rooms for private entertaining/employee collaboration, and an outdoor terrace 415 feet above street level with sweeping 360 degree views of the Philadelphia skyline.  At street level, FMC Tower at Cira Centre South will have a retail pavilion that will also include an upscale bar and restaurant.

The residential portion of FMC Tower at Cira Centre South, designed for short and long-term stays, will be operated by the luxury brand AKA. The Residences at Cira Centre South will feature 268 brand-new, ultra-luxury hotel suites and apartment residences located on the tower's upper 18 floors. The residences feature sophisticated, contemporary interiors and a full floor of wellness and lifestyle-enhancing amenities conceived by internationally celebrated architect and designer, Piero Lissoni.

Tuesday, November 10, 2015

Finding value in REITs despite rising rates (Video)

Multi Family Transaction Pace Accelerates in Philadelphia

by Steve Lubetkin,
Gebroe-Hammer Associates has had a good year so far in Philadelphia, with sales totaling $128 million and 1,250 units, and the market continues to be white-hot, the firm's market specialists say.

Philadelphia’s transaction pace is accelerating in University City and Center City. The urban market specialist recently was involved in arranging more than $60 million in sales encompassing over 350 units throughout the city’s central and western neighborhoods.

Post Brothers, is one of Philadelphia’s most active multi-family property owners and developers seeking to expand their citywide portfolio. These trades included Garden Court Plaza, a 146-unit, 13-story 1920s-era apartment building located at the corner of 47th and Pine Street, and Roosevelt Apartments, a two-building complex just off Rittenhouse Square at 2216-2222 Walnut St., in Center City. As previously reported by, Post Brothers says it will invest $250 million in University City. Both properties are undergoing extensive renovations and repositioning to cater to citywide demand for upscale apartment-homes with superior amenities.

“Districts like University City and Center City are commanding tremendous investment and development interest thanks to gentrification and revitalization initiatives that have gained remarkable momentum during the past several years. Post-graduates are contributing toward defining the ‘vibe’ or character of these districts where the arts, eclectic dining and historic architecture are attracting renters en masse.”

“As forecasted, investor appetite has been insatiable and the tenant base of young professionals continues to absorb new product metrowide at a historic pace. Surrounding urban and suburban submarkets are commanding unwavering attention as well."

Friday, November 6, 2015

Commercial Development in Philadelphia Dramatically Illustrated

by Steve Lubetkin,
A national apartment search website with nearly 2,000 listings in the Philadelphia market is offering a remarkable series of before-after images of commercial development in the City of Brotherly Love, thanks to Google Street View and a timelapse slider tool.

RENTCafé writer Amalia Otet tells exclusively that the website wanted to get a sense of how Philadelphia is doing in terms of real estate development and which areas are drawing the largest investments.

“We’ve scoured the city for the biggest and boldest new constructions that were finalized sometime in the last 8 years,” she says. “Aside from their architectural impact, these buildings are also generally acting as catalysts for more development in their corner of the city. More than simply revealing how far we’ve come, these projects can also help give a better picture of what the future will look like for these neighborhoods.”

Otet’s blog post compares street-level views of 10 locations in Center City Philadelphia taken in 2007 with more recent views from 2014.

“Our research data reveals that the number of renters is on the upswing in Philadelphia, with all signs pointing to further growth,” says Otet. “The city has a lot of potential as rising employment and high apartment demand will keep the market competitive while prices are still relatively affordable. It’s one of the cheapest cities to rent in the Mid-Atlantic, with NYC, Jersey City, and Washington D.C. all posting much higher average asking rents.”
Full story:

Virginia firm buys Cherry Hill apartment complex, two more for $300M

Affiliates of real estate investment and management firm Harbor Group International have acquired three Mid-Atlantic region apartment complexes, including a 546-unit development in Cherry Hill.

More than $300 million total was paid for for the Grand, a two-building high-rise complex on Frontage Road, and two other properties, Norfolk, Va.-based Harbor Group said in a release Thursday.

Also purchased were the 704-unit Crest at Princeton Meadows in Plainsboro, N.J., outside Princeton, and the 748-unit Jefferson at Orchard Pond in Gaithersburg, Md.

Thursday, November 5, 2015

Slow GDP growth is good for property: Starwood CEO (Video)

Carlyle Funding Buys Mullica Hill Plaza for $25.4M

Hart Realty Advisers, Inc. sold the Mullica Hill Plaza shopping center at 141 Bridgeton Pike in Mullica Hill, NJ to Carlyle Funding, Inc. for $25.4 million, or about $292 per square foot.

The 86,842-square-foot neighborhood center is 96 percent occupied by anchor Rite Aid and national and local retailers including Pet Valu, Subway, and Supercuts.

Dermody and PCCP Break Ground in Lehigh Valley

by Steve Lubetkin,
Dermody Properties and PCCP, an integrated real estate finance and investment management firm, have broken ground on LogistiCenterat 33, a 475,800-square-foot industrial facility at 4200 E. Braden Blvd. in Forks Township, PA.

The spec-built facility has not yet been leased, but there is still very strong demand for distribution capacity in the submarket, and his firm is still looking for more locations, Dermody partner Gene Preston tells exclusively.

“While there has been an increase in speculative development recently, many projects are being leased before completion, and the vacancy rate for class A industrial buildings in the Lehigh Valley is less than 4 percent,” Preston says. “Currently, we are actively looking for more development opportunities in the Lehigh Valley and central Pennsylvania.”

LogistiCenter at 33 is centrally located in the heart of the Lehigh Valley near such corporate neighbors as Weyerhaeuser, Crayola, Victaulic and Mondelez, and is within minutes of Interstate 78 and Route 33 via the new Main Street interchange just west of the site.

Dermody Properties and PCCP broke ground at the site on October 29, and expect construction to be complete in mid-2016.

Upon completion, LogistiCenter at 33 will feature 36 feet of clear height, 226 car parking spaces and 85 trailer parking spaces. R.S. Mowery & Sons is the general contractor for the project, and the firm of Randall Paulson is the project architect.

“PCCP sees this as a compelling opportunity to develop a class A industrial facility with Dermody Properties, a best-in-class developer,” says John Randall, managing director with PCCP. “Additionally, the local industrial market incorporates all of the key fundamentals that promise to attract large user interest. Our goal is to pre-lease the property prior to completion of construction.”

“We are pleased to continue our growth in this important logistics market and to expand our relationship with PCCP,” says Douglas A. Kiersey Jr., president, Dermody Properties. “We believe LogistiCenter at 33 will attract a high-quality logistics customer similar to those in our existing facilities throughout Pennsylvania.”

Wednesday, November 4, 2015

$100M Horsham office portfolio in play?

by Natalie Kostelni, Reporter, Philadelphia Business Journal

Rizk Ventures is reportedly buying a portfolio of office properties in Horsham, Pa., from Liberty Property Trust in a transaction valued at an estimated $100 million.
The deal, which involves more than 40 properties Liberty (NYSE: LPT) owns in the Montgomery County office submarket, will mark the company’s exit from it, according to multiple sources.

At the same time, it will be Rizk’s first foray into the Philadelphia region’s office market.
Rizk is a New York investment firm that was formed by Thomas A. Rizk, who operated a company called Cali Realty Corp. that was later merged with another company to form Mack-Cali Realty Corp.
A spokewoman from Liberty declined to comment on market rumors. An official from Rizk couldn’t be reached for comment.

Horsham and Fort Washington, which make up the submarket, have been in transition this year.
Earlier, Brookwood Financial Partners closed on a $183 million, 29-building office portfolio that gave it six properties in Fort Washington including 500 and 501 Office Center Drive and 220 Commerce Drive. That deal meant the exit of Brandywine Realty Trust (NYSE: BDN) from that suburban office market.

If Liberty’s deal with Rizk is finalized, it means that Liberty will also be out of it. Liberty, like Brandywine, has been paring down its suburban office holdings to focus on what it deems as core holdings.

Full story:

O'Brien Rulis Bochicchio expands offices at 1515 Market St.


Law firm O'Brien Rulis Bochicchio has expanded its offices to about 5,200 square feet at 1515 Market St. The firm had occupied 3,700 square feet in the 20-story building.

Philadelphia Center on Alcoholism leased 2,250-square-feet at 1211 Chestnut St. and the Peggy Browning Fund leased a 2,000-square-foot space in the Land Title Building at 100 S. Broad St.

Amazon opens physical store

by Phuong Le, Associated Press
Online retail giant Amazon opened its first brick-and-mortar bookstore on Tuesday, two decades after it began selling books over the Internet and helped drive a number of shops out of business.
The Seattle store, Amazon Books, will be a physical extension of the company website, combining the benefits of online pricing with traditional book shopping, the company said in a statement.

It will offer as many as 6,000 top-rated titles, culled from customer ratings, sales, preorders, and other factors.

The Seattle-based company did not explain its strategy in opening the store or say whether it would open more retail locations.

Amazon Books vice president Jennifer Cast told the Seattle Times: "We hope this is not our only one. But we'll see."
The first shoppers found displays of books with cards containing ratings and reviews. Amazon said it wanted shoppers to walk out with books or later purchase their picks online.

Kenneth Yoder, 58, a Seattle concierge, was among the first in line when the wood-and-glass doors opened at the upscale outdoor shopping center in north Seattle that's also the site of Apple and Microsoft stores.

"I'm excited to physically look and see what the selection is like," said Yoder, who buys books online and in stores.

Others scratched their heads over the irony of the physical location because Amazon is seen by some as one reason so many independent and other booksellers have gone out of business in recent years.

"They're the dominant retailer in the country, and they kind of got there by playing real hardball," said John Mutter, editor-in-chief of the book trade newsletter Shelf Awareness. "They are considered the Darth Vader of the business because they play really brutally."

Yet the store makes sense because it was a missing part of the company's book business, Mutter said.

Sucharita Mulpuru, an analyst with Forrester Research, said the store appears to be an experiment to see what the company can learn.

"If they sell books, awesome. Even if they don't sell books, there's a lot to learn about how people discover products, how they shop for products," Mulpuru said. "Does a physical store increase your likelihood to spend with Amazon in general? Does it make you more loyal to Amazon?"

$26.8M mortgage loan originated for Penrose Plaza shopping center


An investment fund operated by New York's Square Mile Capital Management has originated a $26.8 million mortgage loan for the Penrose Plaza shopping center in Southwest Philadelphia, the company said in a release on Tuesday.

Square Mile Capital Partners is funding the center's recent acquisition and planned capital expenditures by a joint venture of Onyx Properties, Abrams Realty & Development, and Siguler Guff.

The 261,000-square-foot property at 2900-3000 Island Ave. is anchored by a ShopRite supermarket.

Tuesday, November 3, 2015

Coworking Company Benjamin’s Desk Takes 10,000sf at The Curtis

by Steve Lubetkin,
Coworking firm Benjamin’s Desk has taken 10,000 square feet of space at The Curtis, Keystone Property Group’s newly repositioned 900,000-square-foot office, apartment and retail property at 601 Walnut Street in Philadelphia.

With two Philadelphia locations and several others currently under consideration, Benjamin’s Desk has become a popular operator of the coworking office concept. With tenants including entrepreneurs, startups and others looking for non-traditional office facilities, Benjamin’s Desk offers a workspace tailored to its tenants’ unique needs and committed to driving their productivity.

“The coworking environment in many ways reflects our overall revitalization strategy for the building,” says Rich Gottlieb, senior vice president of Keystone. “We aim to foster a vibrant, collaborative setting for visitors and workers alike, and the addition of Benjamin’s Desk contributes to the sense of community we are looking to create.”

"Our partners at the Keystone Property Group have shared with us their vision for a hub in Washington Square where entrepreneurs can live, work, and be entertained,” says Anthony Maher, co-founder and CEO of Benjamin’s Desk. “Likewise, many existing and potential Benjamin’s Desk members have told us that they could benefit from having access to space, customers, and talent near both Washington Square and Old City."

After acquiring the property with Mack-Cali in 2014, Keystone is leading a reinvestment program at The Curtis, including a revitalized ground-floor streetscape and building atrium. The program also includes the development of 59 luxury apartments in a portion of the building's existing office space and the addition of a ground-floor restaurant and retail component to the property, with the aim of creating a renewed experience for office tenants and prospective residents at the historic mixed-use Center City property.

“With the improvements to these iconic properties, we’re playing a role in the creation of the sort of vibrant urban corridor in great demand among today’s energetic workforce,” says Gottlieb. “With the revitalization of Center City, the Market East neighborhood has truly become a live-work-dine environment, and we see its attractiveness continuing to grow.”

Keystone is also reimagining 100 Independence Mall West, which is located several blocks north of the Curtis. Keystone led a joint-venture group that acquired the property – the historic Dow Chemical building – and has creating a dynamic indoor-outdoor experience for pedestrians, replete with the popular Independence Beer Garden and a La Colombe coffee café.

Target Secures Two Locations in Philadelphia

by Steve Lubetkin,
Target Stores has secured two locations in Center City Philadelphia for new, smaller-than-usual retail stores of under 25,000 square feet.

The two locations are 1900 Chestnut (a 23,000 square-foot site being developed by Pearl Properties) and 1112Chestnut (a 22,000 square-foot site being developed by The Brickstone Companies).

The merchandise assortment and services in these locations, sometimes called TargetExpress, will offer quick-trip items focused on immediate use vs. stocking up, as offered in the larger format Target stores. Assortments will include smaller pack sizes and items geared toward instant consumption, like grab-and-go sandwiches and fresh food, but will also include merchandise not found at other quick-trip stores, including an assortment of items in Home and Electronics.

Both locations are currently under construction with planned openings in 2016.

Thursday, October 29, 2015

Post Brothers Reimagining Garden Court Plaza in Philadelphia

by Steve Lubetkin,
Post Brothers, which has embarked on a $200 million makeover of the Presidential City Apartment complex on City Avenue, is moving into the University City district with the acquisition of Garden Court Plaza, a 13-story, 146-unit apartment building at 4701 Pine Street in Philadelphia. The acquisition highlights Post Brothers’ development strategy in the University City neighborhood, where it expects to invest $250 million in the coming years.

"Ultimately, our goal is to create a new standard of living in University City, where the housing product has not kept pace with the growth of local arts, entertainment, and culture," Michael Pestronk, CEO and cofounder of Post Brothers, tells exclusively. “Like so many of the buildings in this neighborhood, Garden Court Plaza reflects the history of the early 20th century residential development boom of University City. While we're indeed making significant upgrades to the building's apartments and common areas, it remains important that we preserve its unique character in the context of the surrounding area."

Post Brothers will commence a strategic effort to reposition Garden Court Plaza, including the implementation of substantial renovations to the buildings’ exteriors and interiors, upgrading of common areas, and the addition of a new onsite management team.

Post Brothers will revive several signature features from the historic Garden Court Plaza building, originally constructed between 1927 and 1929. One such feature is the unique dual-panel front door system – once used for dry cleaning pick-up and drop-off – which the company will restore to peak condition. Additionally, Post Brothers will recreate the building’s “green roof” atop its 260-car parking garage, effectively creating a private park complete with dog runs and lounge areas.

As previously reported by, Post Brothers is renovating the entire Presidential City complex on City Avenue. Pestronk's brother Matt, who appeared on a panel at the CapRate Apartment Summit in Livingston this week, indicated the company also has redevelopment projects in pipeline the urban “Gold Coast” submarket encompassing Jersey City, Harrison, and Bayonne.

University City has undergone a significant economic revitalization, attracting a confluence of arts, entertainment, and new residents. The neighborhood is bounded by several academic institutions, including the University of Pennsylvania, Drexel University, and The University of the Sciences.

“University City has long been a hotbed for the City’s brightest young minds, and the continued expansion of local arts and culture has only made it a more attractive place to live,” says Pestronk. “Our principal goal is to harness the energy of this exciting neighborhood to create re-imagined, high-quality apartments that are reflective of the neighborhood’s vibrant, upwardly-mobile population.”

The property also provides seamless access to the local universities, as well as 30th Street Station, which services both SEPTA and Amtrak train lines.

The company cited University City’s long-term viability for students and post-graduates in its pursuit of Garden Court Plaza and future investments in the area. All three of the neighborhood’s major universities are undertaking extensive multi-million-dollar expansions, and the University City District — a partnership of the area’s educational institutions, businesses, and residents – sponsors various outdoor gathering places, including traditional parks and playgrounds, as well as temporary “parklets.” One space, The Porch at 30th Street Station, has transformed sidewalks and a parking area into a performance and gathering space, which continues to experience increased use as more office workers join the University City mix.

“The ongoing revitalization of University City continues to be one of the most compelling stories in America’s big cities,” says Pestronk. “As the steady influx of start-ups and young companies persists, we believe there is an incredible demand for housing that’s uniquely upscale, yet attainable.”

AKRF Opens Third Philly Area Office

by Steve Lubetkin,
AKRF, an environmental, planning and engineering firm, has opened a Philadelphia office at One Washington Square, near Independence Hall in Center City. The Center City office will cement Philadelphia as a major hub for AKRF, which has offices throughout the Northeast, from New York’s Hudson Valley to the Baltimore/DC area.

Led by Shandor Szalay – senior vice president at AKRF and director of the firm’s water resource practice – the firm’s three Philadelphia area offices provide public and private sector clients with a wide range of services, including stream restoration work; environmental permitting services; air quality analysis; and acoustical, noise and vibration consulting services.

“AKRF is excited to open our newest Philadelphia area office, which represents an investment in the future of this city and a commitment to its continued growth,” says Edward Applebome, president of AKRF.  “With Shandor’s leadership and expertise, our Center City office will allow us to better serve our clients and offer our extensive array of environmental, planning and engineering services to other public and private entities they could benefit.”

“Philadelphia is at the forefront of environmental innovation, with businesses and municipalities across the country emulating their practices,” said Szalay. “AKRF’s expanded presence will allow us to advance the work that we have been doing to support this important effort. I look forward to continuing to do great things in partnership with our clients in the region.”

The new Center City office will serve as AKRF’s headquarters in the Philadelphia metro area. The firm has been a trusted partner to clients in the region for over two decades, and opened its Mt. Laurel, NJ, office in 2004. Earlier this year, AKRF opened a field office on North American Street, which houses its GreenUp Landscape, Environmental Restoration and Maintenance division.

Friday, October 23, 2015

JRK Pays $54.2M for West Chester Multifamily

JRK Property Holdings acquired the 252-unit Jefferson at Westtown Apartments located at 1000 Skiles Blvd. in West Chester, PA from Invesco for $54.2 million, or about $215,000 per unit.

The 391,099-square-foot multifamily community delivered in 1998 on 50.6 acres located off Wilmington Pike, to the east on Skiles Ave., and offers a mix of one-, two-, and three-bedroom layouts across 10 buildings. The multifamily complex features a multitude of interior and exterior amenities including a pool and business center.

AutoZone Leases at Mid-Town Plaza in Middletown, PA

by Steve Lubetkin,
Auto parts and accessories chain AutoZone has leased 7,400 square feet at Mid-Town Plaza in Middletown, PA. The 95,000-square-foot shopping center is exclusively leased and managed by North Plainfield, NJ-based Levin Management.

Levin orchestrated the purchase of an underutilized parcel of land adjacent to the original Mid-Town Plaza site, where it constructed the new free-standing AutoZone store. “Convenient highway access and the presence of a Giant Supermarket made Mid-Town Plaza particularly attractive to this tenant. A nationally recognized retailer such as AutoZone is a tremendous complement to the center’s co-tenancy, and also fills a void for consumers who live and work in this community.”

Located at 450 East Main Street, Mid-Town Plaza is a primary shopping destination within the growing central Pennsylvania marketplace. Anchored by a 59,000-square-foot Giant Supermarket, the center also includes Dollar Tree, Aaron’s and H&R Block.

Thursday, October 22, 2015

Main Line retail property trades for $11M+

Natalie Kostelni Reporter, Philadelphia Business Journal
A property with two commercial buildings fronting Lancaster Avenue in Paoli, Pa., has traded for $11.4 million.

Paoli Center, which totals 1.73 acres at 152 Lancaster Ave., has a Walgreens and PNC Bank fully occupying two structures on the property.

The two buildings total 15,400 square feet and are leased on a long-term basis to the tenants. The property sits just in front of the Paoli Shopping Center, which is owned and developed separately by Brandolini Cos. Pineville Properties of Valley Forge, Pa., was the seller.

A private investor, Theodore Griffinger, bought the property “free and clear of existing debt.”

Full story:

Post Brothers in $210M Redevelopment of Presidential City

by Steve Lubetkin,
One of the largest multifamily complexes in the Philadelphia area is getting a $210 million makeover that will transform more than 1,000 apartment units in buildings named for colonial era presidents into luxury living spaces with upscale amenities.

Post Brothers, a local firm that focuses on developing and operating high quality class-A multifamily properties,acquired Presidential City, 3900 City Ave., in 2012. The four-building complex was built in the 1950s by John McShain, who also built the Pentagon and the Jefferson Memorial, says Matt Pestronk, a principal of the firm with his brother Michael.

“It’s one of the largest multifamily redevelopment projects on the east coast in terms of dollars and in terms of units,” Pestronk tells exclusively. There are currently 1,038 units in the complex, “with zoning to build more,” he says.

“We’d always wanted to buy the property and comprehensively redevelop it, that’s our specialty,” Pestronk says. “When we’re done, we’re going to have an irreplaceable large-scale asset that’s differentiated from an apartment-finish standpoint vs. the rest of the market, and offers renters a very attractive value proposition, a lot of apartment for the money.”

Post Brothers is gut-renovating all four buildings at the Presidential City site, each named for early presidents, and each with its own unique set of amenities: Washington: salon, cardio fitness room, bike storage; Madison: co-working space, barista bar, cardio fitness room, bike storage; Jefferson: shared executive offices, game room, cardio fitness room, bike storage; and Adams: library, kids playroom, cardio fitness room, bike storage.

“It will be a fully amenitized, class-A apartment complex,” Pestronk says. “Everything inside the buildings other than the concrete slabs will be brand new, it will have all new base building systems, plumbing, electric, sprinklers, all new apartment layouts, brand new kitchens, brand-new bathrooms, hardwood floors. Relative to what people are renting class A apartment buildings in Center City Philadelphia, we think we really have a great value proposition for the renter.”

Post Brothers will be adding a 24/7 front desk attendant; world-class lounge with afternoon tea; the Sora Pool Club with waterside cabanas, Olympic-length lap pool, lounge pool, and activity pool, hot tub, spa services, dry sauna, coed steam room, tanning booths, and outdoor amenities including a fire pit lounge, yoga lawn, bocce courts, sport court, tot lot, roof top lounge, outdoor kitchen, and dog parks. A 10,000 square-foot fitness center will offer a state-of-the-art gym and juice bar with free PostFit classes in cardio, pilates, yoga, cross-fit and spin, with private training sessions available.

“Our specialty is gut-renovation and repurposing of existing buildings,” says Pestronk. “The property was at the end of its useful life and it was marketed to people who were used to buying value-add apartment properties, like 1970s vintage garden apartments, which are worlds easier to renovate than high-rise apartments from the 1950s. We just thought the best way to look at the property was as a blank slate that needed complete reconstruction.”

Post Brothers has done several similar projects of this scale, and Pestronk says that the challenge for his firm was to make sure the renovation lives up to the quality and reputation of the location.

“The challenge was doing the site justice,” he says. The Washington tower is finished and about 75 percent leased. The three remaining towers should be renovated and leased up by early next year, he says.

Tuesday, October 20, 2015

Nissin Foods Leases 118,000 SF in Lancaster

Nissin Foods signed a lease to occupy 118,000 square feet at 129 S. Tree Ln. in Lancaster, PA.

The 118,750-square-foot industrial building was constructed in 1997 on nine acres in the Lancaster County Industrial submarket. The warehouse includes 4,150 square feet of built-out office space and features 12 loading docks, two drive-in bays, and a 30-foot clear height.

Ultra-Rich Are Now Breaking Into the Real Estate Market (Video)

Saint-Gobain North American HQ Opens in Malvern, PA

by Steve Lubtkin,
After decades of neglect, a former Bethlehem Steel headquarters building in this Chester County suburb of Philadelphia has been redeveloped into a glistening new, LEED-certified North American headquarters for Saint-Gobain, one of the world’s largest building materials companies. And the project wasn’t easy to complete, according to Eli Kahn, president of E. Kahn Development, which spearheaded the project.

“It’s been almost a decade that our team has been working on this project, designing, engineering, imaginging, marketing and envisioning the transformation of these 1960s decaying office buildings into the finished office building you see behind you,” he told several hundred attendees at the ribbon cutting.
“The primary challenge in any green building development is finding a customer who shares the same vision and is willing to support and invest in green technologies,” Kahn recalled in an exclusive interview with “Once you find that customer, the process is actually pretty smooth because the  products you are using are state-of-the-art, the building becomes a higher-end product.”

Redeveloping the building was particularly satisfying, says Kahn, because it replaced a building that had become an eyesore with a modern showplace for corporate office design.

Bethlehem Steel used a new kind of steel for the construction of the exterior shell of the building, called CorTen steel, that was supposed to develop a patina over time, he says. “The actual steel oxidized and rust coated the windows. So for 40 years of occupancy of this building, the tenants had windows covered with rust because it was too expensive to keep cleaning it. To see that building turned into this, it’s the most satisfying project I’ve ever been involved with.”

The building, which becomes Saint-Gobain’s new, state-of-the-art North American corporate headquarters, is located at 20 Moores Road in Malvern, PA. The 320,000-square-foot campus, situated on 65 acres, underwent a renovation over the past 18 months to transform the long-dormant site into a dynamic showcase for Saint-Gobain and its North American construction materials subsidiary, CertainTeed Corporation.

Saint-Gobain timed the opening ceremony for the exact day Saint-Gobain was founded 350 years ago by King Louis XIV of France to manufacture glass for the Hall of Mirrors at the Palace of Versailles near Paris.

“Saint-Gobain and CertainTeed’s headquarters is designed to demonstrate the power our products have to improve the quality of people’s lives. It is a shining example of how innovative companies can design, construct and renovate sustainable, healthy, comfortable and environmentally friendly buildings around the world,” says John Crowe, president and CEO of Saint-Gobain and CertainTeed Corporations.

In addition to E. Kahn Development Corp., J. Loew & Associates and AEGON USA Realty Advisors led the headquarters’ redesign. The building is a high-performance, sustainable building designed to achieve the highest level of Leadership in Energy and Environmental Design (LEED) certification from the US Green Building Council (USGBC).

In April 2014, Saint-Gobain signed a long-term lease for the campus that will be the workplace of more than 800 employees across Saint-Gobain and CertainTeed.

The expanded campus is also home to CertainTeed’s Malvern Innovation Center, which opened in October 2014, and marks the first time the company’s local research and operations teams will share a site. The new headquarters incorporates an open-concept office space; 116 collaborative spaces; a cafeteria, along with other food and beverage spaces; a fitness facility; a pond; a fountain installation; and 1.3 miles of walking trails.

Key project members included Bernardon as the designer for the exterior and lobby; Jacobs as the designer for the interior; D. Fickler Construction as the contractor; and Binswanger as the real estate broker and project manager.

The headquarters showcases 40 products – eight on the exterior and 32 in the interior – from Saint-Gobain’s family of companies, including CertainTeed Corporation, SageGlass, Saint-Gobain Glass, Saint-Gobain ADFORS and Saint-Gobain Performance Plastics. Saint-Gobain selected the products to achieve energy efficiency, sustainability, indoor environmental quality, acoustic and aesthetic goals.

The company says it also incorporated sustainable construction practices into the building:

Approximately 79 percent of construction and demolition waste was diverted from landfill disposal.
Materials in the building were carefully selected to contain high levels of recycled content. Post-consumer and -industrial recycled content reduced the negative impact resulting from the extraction and processing of raw materials.
Special consideration was given to selecting locally manufactured materials. For example, furniture workstations were manufactured in East Greenville, PA, and Toronto, Ontario, Canada. By specifying locally manufactured materials, less energy was spent to bring the products to the site.
This project will achieve significant water savings through the use of low-flow plumbing fixtures. The project is projected to use 40 percent less water than a conventional office building, saving 640,000 gallons of water per year.
Interior finishes and furnishings installed in the building were specified to contain little or no VOCs. For example, low-emitting products used included adhesives, sealants, paints, coatings, flooring, composite wood and furniture. Reducing the amount of VOCs entering the building provides a safer and healthier environment for building occupants.
In an effort to significantly reduce the number of miles employees travel to and from the campus the company is providing bicycle storage facilities, preferred parking for low-emission and fuel-efficient vehicles, electric vehicle charging stations and a free shuttle service to and from the Paoli Station, which services Amtrak and SEPTA trains, for employees who choose to commute from Center City and other areas.

Saturday, October 17, 2015

Two firms get $14.4 million in tax breaks under Grow New Jersey

Allison Steele, Inquirer Staff Writer

The state Economic Development Authority on Thursday approved $9.4 million in tax credits to the Winslow branch of the Eggo Co., a subsidiary of Kellogg, for an expansion, as well as $5 million for a laundry company to move from Bellmawr to Camden.

The authority also approved $5 million in tax breaks for public housing in Camden's Centerville neighborhood and signed off on transferring the rights of a 16-acre parcel of Camden's waterfront to Liberty Property Trust, the powerhouse developer that last month announced plans to build offices, homes, and a hotel on the land.

The Eggo and Clean Green Textile Service projects are the latest to be approved under the Grow New Jersey program, which provides incentives for employers who remain in the state or who invest in struggling cities as part of the 2013 Economic Opportunity Act. That law, which U.S. Rep. Donald Norcross (D., N.J.) championed as a state senator, allows the broad use of tax incentives to lure employers to cities like Camden.

The EDA has since approved more than $1 billion worth of tax credits for companies that plan to move to Camden, including Subaru of America, Holtec, and Lockheed-Martin. To earn the incentives, companies must maintain a certain level of jobs and remain in Camden for set periods of time.

Critics say the deals mostly involve relocating jobs from elsewhere in South Jersey, and include no strategies for addressing Camden's high unemployment rate. Supporters say the moves will create new jobs and temporary construction work, although companies are not required to hire city residents.
The Clean Green Textile Service, a commercial laundry business with 59 full-time employees in nearby Bellmawr, will receive tax credits worth $5 million for moving to Camden instead of Pennsylvania - a relocation expected to have a net benefit to the state of about $73,000 over a period of 35 years, according to the EDA.

Since the agreement requires the company to stay in New Jersey for only 15 years, the company could move after that and still receive the full incentives that were awarded, said Jon Whiten of the liberal think tank New Jersey Policy Perspective.

"Even if the company stayed for 30 years, the state would still lose money on this deal," Whiten said. "No sensible lender would accept such a risk."

Eggo, a Kellogg subsidiary that makes such frozen breakfast food as waffles, is looking to double the size of its 100,000-square-foot manufacturing plant in Winslow and to add 118 jobs. Without securing tax breaks for the $85 million expansion, the company could move to Michigan, according to its EDA application.

The application to remake Camden's Branch Village housing complex, submitted by the city housing authority, sought tax breaks under the Economic Redevelopment and Growth (ERG) program, which provides grants for developers to fill funding gaps in building projects.

The $5 million in credits awarded by the EDA would offset the $16 million cost of building a 50-unit, three-story apartment complex in the city's Centerville section, a main focus of development efforts in recent years. The project would also involve demolishing three vacant buildings on the site.

The project, expected to break ground by the end of the year, will be spearheaded by the Michaels Organization, an affordable-housing company that has worked in Camden for years and will lease the site.

Michaels, based in Marlton, is also a backer of the major Camden waterfront-development plan announced last month. Michaels president John O'Donnell is a longtime friend of South Jersey Democratic power-broker George E. Norcross III, brother of Donald Norcross and head of Cooper University Hospital. George Norcross has said he lobbied longtime friend and Liberty Property Trust CEO William Hankowsky to take on the waterfront project.