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.

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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.

Friday, October 16, 2015

World wants property in US: Larry Silverstein (Video)

Employee Benefits Firm Moving to SORA in Conshohocken

by Steve Lubetkin,
Keystone Property Group has attracted Brown & Brown of Pennsylvania, an employee benefits and business insurance firm, to SORA East, its redevelopment project in Conshohocken, PA.

Brown & Brown signed a 16,846-square-foot lease at 125 East Elm Street (known as SORA East), which is part of a multifaceted, transit-oriented redevelopment initiative located in the heart of Conshohocken.

“It’s become abundantly clear that Conshohocken provides a mix of urban vitality and accessibility to Philadelphia that is attractive to businesses throughout the region,” says Bill Glazer, president of Keystone. “With SORA, we’re on the precipice of creating a truly special centerpiece in the borough – a commercial and cultural nucleus that will harness the rising energy of Conshohocken by providing a central hub to work, stay, and play.”

Brown & Brown adds to a tenant base at SORA East that includes Keystone itself, which relocated its headquarters to Conshohocken in February 2015. Keystone currently owns four commercial properties in Conshohocken, a burgeoning suburb of Philadelphia only a short drive or SEPTA ride from the city.

Upon completion, SORA – formerly known as One Conshohocken – will consist of more than 350,000 square feet of class A office space, structured parking, and a 220-room, hotel.

Paradise Properties Acquires Montgomery County, PA Multifamily

by Steve Lubetkin,
Paradise Properties has acquired the Madison Hunt Club in Montgomery County, PA, from Equus Capital Partners for $65 million. The 320-unit apartment community is in North Wales, PA, 20 miles north of Philadelphia. At the time of the sale, the community was 96 percent occupied.

“Madison Hunt Club’s convenient and irreplaceable infill location within immediate proximity to such desirable retail amenities as Whole Foods and Trader Joe’s resulted in extraordinary investor interest in this community,” says Greg Curci, vice president of Equus, who was responsible for overseeing the disposition for the firm.

Located less than a half mile from the entrance to the 309 Expressway, Madison Hunt Club has convenient access to the Pennsylvania Turnpike and downtown Philadelphia, as well as the major employment centers of Montgomery and Bucks County. The garden style apartment community offers a diverse mix of one, two, and three bedroom apartments in a low-density and attractive setting. All units offer private entrances, full-size washers and dryers, and patios or balconies.  Community amenities include an outdoor swimming pool, tennis and basketball courts, fitness center, playground, and a nature trail.

An affiliate of Equus acquired Madison Hunt Club from AIMCO in 2008 as part of a three-property portfolio.  The transaction was made on behalf of BPG Investment Partnership VIII, a $550 million private equity fund.

Thursday, October 15, 2015

Brandywine Realty Trust Sells Mt Laurel Corporate Park I

Brandywine Realty Trust sold the Mt. Laurel Corproate Park 1 office building at 1000 Howard Blvd. in Mount Laurel, NJ for $16.5 million, or about $157 per square foot.

The 105,312-square-foot building was constructed in 1988 and renovated in 2011. Some notable tenants are CBRE and Berkely Holdings Corp.

Wednesday, October 14, 2015

Prologis Delivers 1.5M-SF Park 81

Prologis completed construction of Park 81, a 1.5 million-square-foot distribution facility at 234 Walnut Bottom Rd. in Shippensburg, PA.

Prologis broke ground on the property in the fourth quarter of 2014. The industrial building features 150 docks, 36-foot ceiling heights, and 56-foot column spacing.

Georgia-Pacific, a manufacturer of pulp and paper products, will occupy the entire built-to-suit property under a seven-year lease signed in 2014.

Brennan Investment Grp Completes Sale Leaseback of Markel HQ

Brennan Investment Group LLC purchased the industrial building at 435 School Ln. in Plymouth Meeting, PA from Markel Corporation for an undisclosed amount, immediately leasing back the entire facility to Markel, one of the country’s largest manufacturers of high-end fluoropolymer solutions.

The 167,666-square-foot manufacturing facility was built in 1930 on 10.6 acres in the East Montgomery County Industrial submarket of Philadelphia. The two-story building also houses the firm's corporate headquarters.

Miller Investment Mgmt Acquires The Plaza

Miller Investment Management acquired The Plaza office building at 401 Market St. in Philadelphia, PA from National Financial Realty and Oaktree Capital Management LP for an undisclosed amount.

The 11-story, 507,214-square-foot office building was constructed in 1973 on 1.8 acres in the Independence Hall submarket. The asset anchored by Wells Fargo in approximately 372,000 square feet.

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Monday, October 12, 2015

Monthly Economic Outlook – October 2015 (Video)

Growing Demand for High Street Retail in Philadelphia

by Steve Lubetkin,
Investment demand and pricing for retail properties in Philadelphia have skyrocketed, and rents have reached their highest levels along Walnut Street.

The report cites “the secular reemergence of our inner cities,” as a driver of demand for high street retail shops, and predicts “an upward trajectory for the foreseeable future.”

Center City Philadelphia’s average household income increased 52 percent between 2000 and 2015, and the number of households earning more than $500,000 a year nearly quadrupled in that time period. Households between $200,000 and $500,000 jumped 454 percent.

Increasing numbers of professional workers occupying 27 million square feet of class A office space also are contributing to new demand for upscale shopping opportunities.

But even with the obvious demand, a blizzard of announcements by retailers and developers, and all the ribbon cuttings and groundbreakings going on, it wasn’t very easy to document it with data.

In the report, Surging Demand for Urban Retail, Anderson says with all modesty that his research into urban retail of all kinds in many large cities was groundbreaking, because very little data had ever been collected on high street retail economics.

“I have dug about as deep as anyone to find out data about this property type, and it is extremely difficult to break into,” Anderson tells exclusively. “It sheds some light on a very non-transparent property type, in fact one of the most opaque property types out there.”

Trying to find rent histories for retail properties in cities like New York or Chicago is difficult, as there is no central data collection for this kind of information, he says.   Anderson assembled what he describes as “one of the nation’s first true High Street retail rent indices, based upon actual lease transactions.” He says he spent months digging up and reviewing actual lease documents to assemble the data.

The index will be valuable for investors because now they will know volatility and rent growth in high street retail vs. shopping centers, offices, or apartments. “It helps a lot with decision-making.”

For prospective tenants, knowing about rent histories and rental rate growth could help in the decision to sign a lease.

“I don’t know if it’s going to deter you from signing a lease, but certainly if you’re at the top of the market, you may want to see what your risk is from signing at this point in the market, and what kind of downside there might be."

Prime rent in Philadelphia has grown at the second-fastest rate for cities since the first quarter of 2008. The 88 percent increase in prime Philadelphia rents has only been exceeded by growth in Miami prime rents, which were up 141 percent in the same period. Still, even with the robust growth, Philadelphia prime rental levels at the end of 2014 were at $225 per square foot, a fraction of the $3,600 rate in New York.

“Part of it is that more retailers and more investors are getting comfortable with Philadelphia’s high street and a lot of the dynamics that are occurring in Center City. That’s pushed up rents.”

From 2001 to 2014, Philadelphia's High Street Retail Rent Indicator, which accounts for actual ground-level lease transactions under 10,000 square feet along Walnut Street, increased 108 percent. Through the first six months of this year, the index rose 15 percent to $154 per square foot, its highest level ever, and a big jump vs office rents, which only went up eight percent in the same time period.

Visitor spending will also contribute to high street retail sales. The Philadelphia Convention and Visitors Bureau indicates that overseas visitors to the city increased 70 percent from 2003-2013, and the recent successful visit of Pope Francis to the city did much to enhance the city’s worldwide reputation for being able to manage large-scale events.

J.B. Hunt Signs Long-Term Lehigh Valley Lease

by Steve Lubetkin,
J.G. Petrucci Company has signed a long-term lease with J.B. Hunt Transportation Services for about 25,000 square feet on 10 acres at 1235 Easton Road in the Lehigh Valley Industrial Park VII in Bethlehem, PA.

J.B. Hunt is one of the largest transportation logistics companies in North America, and provides transportation services to a diverse group of customers throughout the continental United States, Canada, and Mexico.

“We are thrilled that J.B. Hunt has chosen to join us at 1235 Easton Road,” says Greg Rogerson, principal of J.G. Petrucci Company. “J.B. Hunt is an industry leader in transportation logistics and will be a great asset to the LVIP VII park system.”

J.G. Petrucci Company is a privately held development and design/build organization with 28 years of experience in the design, development, re-development and acquisition of commercial, industrial, educational, multi-family and healthcare-related properties. J.G. Petrucci Company Inc. also specializes in green building as well as brownfield re-development and adaptive reuse projects.

Friday, October 9, 2015

Is it time to sell my commercial real estate? (Video)

Tier REIT Puts Woodcrest Corporate Center Up for Sale

Tier REIT, Inc. has put its 385,923-square-foot portfolio of two Cherry Hill, NJ office properties up for sale.

The Woodcrest Corporate Center portfolio includes 101 Woodcrest Rd., a two-story, 333,275-square-foot, class A office building that was constructed in 2004 and is currently 90 percent leased. Also included in the portfolio is 111 Woodcrest Rd., a two-story, 52-648-square-foot office building that was constructed in 1976 and renovated in 2004. This building is currently 86 percent leased.

The two-building office complex is home to American Water Works, Xerox, and Pinnacle Foods, the three largest tenants occupying space in the complex.

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Thursday, October 8, 2015

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Wednesday, October 7, 2015

2000 Market Street On The Block

Gemini Rosemont Realty has put its office building at 2000 Market St. in Philadelphia, PA up for sale. Gemini purchased the building for $110 million in 2013.

The 29-story office building totals 665,649 square feet of 4-Star office space. It was constructed in 1972, with renovations done in 1993. Prominent tenants include The Board of Pensions of the Presbyterian Chruch, Zurich American Insurance, and law firm Marshall Dennehey Warner Coleman & Goggin.

Trammell Crow Breaks Ground on Lebanon Valley Distribution Center

Trammell Crow broke ground this week on the Lebanon Valley Distribution Center, an 874,126-square-foot industrial building located between SR-22 and Fredericksburg Rd. in Fredericksburg, PA.

The new facility will total 874,126 square feet of cross-docked distribution space featuring 123 dock doors, which could be expanded to 155. The Lebanon Valley Distribution Center is approved for a Local Economic Revitalization Tax Assistance (LERTA) 10-year tax abatement commencing in the first full year after the property is completed and application filing.

The new facility has an expected delivery date of March 2016.

Chinese are snapping up CRE property in US (Video)

Miller Real Estate Acquires 401 Market Street, Philadelphia

Miller Real Estate Fund II, LP has acquired 401 Market Street (The Plaza), the 11-story, 500,000 SF Class A office building at 401 Market Street, Philadelphia, PA.

This premier office building is fully occupied by Wells Fargo Bank and American Bible Society. Wells Fargo and predecessor organizations have occupied 401 Market Street since it was built in 1971 for Philadelphia National Bank.

American Bible Society, founded in 1816, recently relocated its headquarters to 401 Market Street after selling its New York City location. The organization occupies approximately 130,000 SF and has proposed creating a museum-quality interactive Bible exhibition on the ground floor to take advantage of the building’s proximity to Independence Mall and historic Old City.

“We are excited to own this irreplaceably located asset that is well positioned to benefit from our long term belief in the strength of the Philadelphia real estate market,” said H. Scott Miller, Managing Partner and Founder of Miller Investment Management and Miller Real Estate.

Lou Merlini, Principal of Miller Real Estate Fund II, added: “The acquisition of 401 Market Street represents a pivotal milestone for our fund as we continue to expand our presence in Philadelphia.”

CBRE Global Investment Fund Buys 1.5M Sqft Central PA Distribution Center

A fund advised by CBRE Global Investors has acquired Park 81, a class A 100 percent triple-net-leased, single-tenant distribution/warehouse industrial building in a key distribution corridor of Central Pennsylvania. The newly delivered build-to-suit property totals nearly 1.5 million square feet. Terms of the transaction were not disclosed.

“The growth of the Central Pennsylvania industrial submarket is evidenced by an influx of corporate users entering and expanding into the market.Park 81 is aligned with our investment criteria of acquiring industrial assets with strong in-place cash flow and long-term leases to quality tenants and gives us access to a primary big box logistics corridor.”

Park 81 is located at 234 Walnut Bottom Road, Shippensburg, PA, within the I-81/I-78 Distribution Corridor. Park 81 offers the state-of-the-art features demanded by today’s distribution/warehouse users including: double-wide stacking lanes at the entrance; cross-docking configuration; ESFR sprinklers; 56 x 50-foot deep column spacing; 60-foot speed bay; 36-foot clear height; 249 trailer parking spaces which are expandable to 358; 114 car parking spaces which are expandable to 189; 150 dock doors plus 132 knock-out panels; and T-5 fluorescent lighting.

I-81/I-78 Distribution Corridor is consistently ranked as one of the top submarkets for big box distribution centers throughout the United States. This market is one of the largest and fastest-growing industrial markets in North America. Driving factors of the submarket include: multi-modal infrastructure, low operating costs, regional parcel and freight hubs, strong concentration of third-party logistics suppliers, super-regional highway infrastructure and an abundant labor force.

Monday, October 5, 2015

US to remain on Real Estate recovery road? (Video)

Deptford Mall part of $2.3B deal

Natalie Kostelni Reporter- Philadelphia Business Journal
The Macerich Co. has sold a large stake in the Deptford Mall as apart of a $2.3 billion transaction that involved a total eight of the company’s retail properties.
Macerich (NYSE: MAC) established two joint ventures with GIC Real Estate, which is a sovereign fund with Singapore, and Heitman, a global real estate investment firm.
GIC took a 40 percent interest in five properties while Heitman took a 49 percent stake in three malls.

The Deptford Mall had sales of $595 a square foot and was 93.6 percent occupied at the time of this transaction, according to Macerich. Heitman took a 49 percent interest in the mall, located at 1750 Deptford Center Road in Deptford, N.J.
The 1.04 million-square-foot property is a major South Jersey shopping destination and is the seventh largest mall in the Garden State.
Macerich bought the Deptford Mall in 2007 for $241 million from Simon Property Group (NYSE: SPG).
It was the only Macerich owned property that was part of the transaction with GIC and Heitman. Macerich plans to use the proceeds in a stock buy-back program.

Full article:

Royal Farms Adding Two Locations in PA

by Steve Lubetkin,
Two new locations were signed for Royal Farms, a convenience store chain expanding in the Delaware Valley.

Royal Farms will begin construction this fall in Upper Chichester and Glenolden, PA. Grand openings for both locations are planned for spring 2016. The retailer recently opened its first location in the Delaware Valley at 105 S. Stewart Avenue, Ridley Park, PA.

“We’re excited to continue our expansion into the Delaware Valley after our store opening in Ridley Park last January,” says Brittany Eldredge, public relations and customer service manager, Royal Farms. “We anticipate the same level of success we’ve seen at the Ridley Park location, and we’re looking forward to serving another community in the area.”

Royal Farms was established in 1959 and has grown to a regional chain of 160 stores throughout Maryland, Delaware, Pennsylvania and Virginia.

Every Royal Farms store is built to LEED environmental standards, using programs to recycle water and waste products while also choosing low impact construction materials and ultra-high efficiency systems. Royal Farms currently has 24 LEED certified stores, ranking them in the top 10 retailers in LEED sustainably built stores.

“Their new locations in Upper Chichester and Glenolden are heavily traveled and easily accessible. We continue to see more and more communities interested in bringing a Royal Farms into their area, and we’re happy to be able to meet some of that demand with these two locations.”

Southern Land Company Celebrates Grand Opening of 3601 Market

by Steve Lubetkin,
Southern Land Company held a grand opening of 3601 Market, University City’s much anticipated luxury residential and retail community on September 30.

“We are thrilled to bring this vibrant and exciting community to University City,” says Tim Downey, Southern Land Company CEO. “With its sleek design, resort style amenities and high quality restaurants, 3601 Market sets a new standard for design and livability in one of the most dynamic neighborhoods in Philadelphia.”

3601 Market is a 363 unit, 28-story luxury mixed use community built by Southern Land Company in partnership with Redwood Capital Investment, and the University City Science Center.  Designed by BLT Architects and The Harman Group as structural engineers, 3601 Market marks the first residential offering located on the University City Science Center’s 17 acre campus.

“The opening of 3601 Market is a key milestone as we transform our campus into a 24/7 innovation community,” says University City Science Center president and CEO Stephen S. Tang, PhD, MBA.

Opened in August 2015, the project includes 15,600 square feet of restaurant and retail space, featuring local and national retailers such as Herban Quality Eats, a fast causal restaurant focused on fresh ingredients and healthy food; Danlu, an Asian influenced bar and restaurant; Schmear It, a socially conscious bagel shop; PWS, a local pizza joint; Dunkin Donuts and Jimmy John’s sandwich shop.

3601 Market offers studio, one and two bedroom units and penthouses ranging from 415 square feet to 1,525 square feet. Residential amenities include a resort-style saltwater rooftop pool, doorman service, 24-hour fitness center with designated spaces for yoga and spin classes, private resident lounges with flat-screen TVs and onsite parking for vehicles and bicycles. Apartment homes come equipped with stainless steel appliances, quartz countertops, hardwood flooring, a washer and dryer, and panoramic city views – many with private balconies.

Four Leases Signed at Rodin Place

by Steve Lubetkin,
Four lease agreements were negotiated  for approximately 32,240 square feet of office space at Rodin Place, 2000 Hamilton Street.

In the largest of the leases, the Free Library of Philadelphia is moving into approximately 19,400 square feet on the second floor of the structure under a long-term agreement. In the second space contract, Dress for Success has moved into approximately 5,000 square feet.

In the third agreement, College Possible has opened offices in 4,000 square feet on the third floor of the three-story building.

In the last lease, Crown Castle, the nation’s largest provider of shared wireless infrastructure, is occupying 3,850 square feet in the concourse level of Rodin Place

Aggregate rental was not disclosed.