Friday, January 9, 2015

COPT to Finish Final Stages of Aborcrest, Blue Bell

By Natalie Kostelni, Staff writer for the Philadelphia Business Journal

Corporate Office Properties Trust is closing in on the final stages of the transformation of Arborcrest, its office campus in Blue Bell, Pa.
The company began redevelopment of what was the former Unisys Corp. complex in 2008 when it embarked on what will be a $120 million effort to reposition the property once occupied by a single tenant — Unisys — into a series of modern office buildings that would attract top tenants and top rents. So far, the company believes it has accomplished what it set out to do.

"We have absolutely had tremendous success with that marketplace," said Steve Budorick, chief operating officer at COPT of Columbia, Md. "It is a combination of tremendous product strategy and a very effective redevelopment and marketing team. Our value proposition of delivering very contemporary, well lit space that appeals to the Millennial work culture at a competitive price point has been effective."

Rents run in the high $20s a square foot and the roster of tenants at Arborcrest include Coredial, McGladry, Integrated Project Services, PRA Health Services, Annodyne Inc., Brokerage Concepts Inc., Mayo Seitz Inc. and others.

For decades, Unisys occupied about 960,000 square feet at the 137-acre property at Union Meeting Road and Penllyn Blue Bell Pike in the Blue Bell section of Whitpain. Unisys significantly shrank down to 180,000 square feet, giving COPT an opportunity to revamp structures on the property. It first completed Lakeside I, a 219,000-square-foot building at 801 Lakeview Drive that is now occupied by Unisys and McDonald's.

The real estate company then tackled a massive building it cut up into three structures — Hillcrest I, II and III — with a courtyard in the middle.
"We removed square footage to create the three buildings and to break the project down into more manageable redevelopment chunks," Budorick said.

Hillcrest I, a 115,700-square-foot building at 751 Arbor Way was carved out and completed by the first quarter of 2012. Hillcrest II, a 178,100-square-foot building at 721 Arbor Way, was built out by early 2013; and Hillcrest III, a 138,500-square-foot building, is scheduled to be completed sometime this quarter.

Three leases are in negotiations now and, once wrapped up, will mean the entire 651,300 square feet of redeveloped space - on which it spent $92 million - will be fully occupied.
It will also mean the eventual kick off of the final phase, the redevelopment of what is called Woodlands I, a 219,000-square-foot building.

COPT plans to spend roughly $28 million to re-do that structure and is still finalizing its plans.
"We have an extraordinarily exciting design for that," Budorick said.
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