Thursday, June 30, 2016

New Plans Presented to Norristown Council for Kennedy-Kenrick Site

By: Lance Knickerbocker
Aquinas Realty Partners of Havertown has presented Norristown Council with several alternative development proposals for the former Kennedy-Kenrick Catholic High School property, writes Carl Rotenberg for The Times Herald.

The property had been approved for the development of a 208-unit senior housing proposal from Pottstown-based Hallman Retirement Neighborhoods in November 2013, but it never progressed any further.

The original $50 million project proposal from Hallman involved 46 units and a community center which would be built in the retrofitted high school building. The plan also included two multi-family buildings totaling 98 units, 28 town houses, and two single-family homes for residential staff.

Aquinas’s first alternative would demolish the school building and use its footprint to build a four-story main building of 98 independent-living units with another two 54-unit buildings developed over two parking garages.

The second option is a main three-story building of 110 units and two 48-unit, three-story buildings over a parking garage. The third option has above ground parking lots with a larger 206-unit building built in phases.

If there is a favorable response from council, the company may present its plans to the Norristown Planning Commission on July 12.

Launch Trampoline Park Jumps Into 32,000 SF in Deptford

Launch Trampoline Park signed a lease for 32,220 square feet in the retail building at 1500 N. Almonesson Rd. in Deptford, NJ.

The Court at Deptford I shopping center totals 361,103 square feet in the Gloucester County submarket of Philadelphia. The Goldenberg Group, Inc. developed the property in 1991, and it is currently owned by DLC Management Corp.

Hartford Funds Leases 76,000 SF in Wayne

Hartford Funds signed a lease for 75,922 square feet in the office building at 690 Lee Rd. in Wayne, PA. The Fortune 500 national investment and insurance company will occupy the entire building in a deal that commences in mid-2017.

The three-story, 75,922-square-foot office building was constructed in 1988 on 10.1 acres in the King of Prussia / Wayne submarket of Chester County, within the Chesterbrook Corporate Center.

Pitcairn Properties and SEB Immobilien USA acquired the asset as part of a 17-building bulk portfolio acquisition in 2006 from FV Office Partners for $251 million, according to CoStar data, in a sale that allocated the single-asset price at $13.88 million.

Dermody Properties Breaks Ground on New Warehouse

Dermody Properties and Great Point Investors LLC have broken ground on a new 393,120-square-foot distribution center at 2810 Oldmans Creek Rd. in Logan Twp, NJ.

Slated for delivery this fall on a 46-acre tract in the LogistiCenter at Logan business park, the property will feature 36-foot clear heights, 90 loading docks and four drive-ins, 186 car parking spaces and 129 trailer spaces within the Gloucester County Industrial submarket of Philadelphia.

LogistiCenter at Logan is a 1,100-acre, master-planned business park. Upon total build-out, the site will accommodate over 7.4 million square feet of industrial, distribution, and light manufacturing space. Currently, there is 4 million square feet of fully-entitled land parcels available for build-to-suit or sale. The proposed facilities, ranging from 10,000 to 1.2 million-square-foot buildings, have been designed to optimize the distribution supply chain and maximum speed to market. There are 11 existing buildings in the park, totaling 3.4 million square feet, located 12 miles south of Philadelphia with direct access to I-295, NJ-Turnpike, Route 130, I-95 and rail service.

Keystone Acquires One Washington Square In Philadelphia For $114 Million

by Steve Lubetkin
Keystone Property Group has acquired One Washington Square, also known as the Penn Mutual Tower, an 880,000-square-foot commercial building located at 510-530 Walnut Street in Philadelphia, for $114 million.

One Washington Square, located on the Northeast corner of historic Washington Square, represents Keystone’s latest investment in the historic Independence Mall submarket. The property is located adjacent to The Curtis, Keystone’s newly repositioned mixed-use property overlooking Washington Square Park and Independence Mall. These properties are within blocks of 100 Independence Mall West, the historic Dow Chemical building that Keystone has reimagined, creating a dynamic indoor-outdoor experience for pedestrians, replete with the popular Independence Beer Garden and a La Colombe coffee cafĂ©.

“We strongly believe that Washington Square and the surrounding neighborhoods are quickly becoming an epicenter for modern, forward-thinking workforces in search of a fresh, collaborative environment,” says Bill Glazer, president and CEO of Keystone Property Group. “This area is indeed historic, but it’s also emerging as one of the city’s coolest hubs that blends culture, entertainment, dining, and business.”

One Washington Square is home to several corporate headquarters, including the American Board of Internal Medicine, Urban Engineers, and BDP International. The building, which is designated with landmark status by the National Register of Historic Places, has received extensive renovations throughout its history, most recently in 2014. Keystone is currently in the process of planning a variety of structural and systems upgrades to the building.

Keystone is seeking to convert the building’s ground-floor and mezzanine office space located at 530 Walnut Street into retail, reflecting the area’s growing workforce and pedestrian traffic. Keystone has a history of implementing successful conversions at its nearby properties, including 100 Independence Mall West and The Curtis, where it is revitalizing the ground-floor streetscape and building atrium while adding 63 luxury apartments.

“The reinvention of the pedestrian experience at this building is central to our mission to create a more dynamic mixed-use environment in one of Philadelphia’s most historic neighborhoods,” says Glazer.

Currently, Keystone is marketing ground floor and mezzanine retail spaces from approximately 20,000 to 40,000 square feet.

Wednesday, June 29, 2016

CHOP Leases Former Grocery Store In Haverford, PA

by Steve Lubetkin,
The Children’s Hospital of Philadelphia is leasing 663 W. Lancaster Avenue in Haverford, PA, the site of the former Foodsource grocery store. CHOP is relocating its former practice location at 600 Haverford Road to the new site. The practice opened to the public June 27.

“This is a high-profile, well known location on the Main Line and the property owners were willing to wait to identify a tenant that would not only provide unique services to the community, but also be recognized as a good corporate neighbor. The newly renovated 13,458 square-foot building is one of the few sites along Lancaster Avenue with great visibility, presence and an abundance of off-street parking. This move for CHOP is another example of the medical community continuing to raise its profile in the suburbs with retail-type sites outside of a Center City campus.”

Monday, June 27, 2016

Madison Farms Mixed Use Community Expands In Bethlehem, PA

by Steve Lubetkin,
With more than three quarters of the first residential phase Madison Farms now leased, The KRE Group and The Silverman Group have begun construction of the second phase of the mixed-use community in Bethlehem Township, PA.

The first phase of the project has delivered 294 rental apartments and 123,000 square feet of complementary retail space to the Lehigh Valley, with another 40,000 square feet of retail space currently under construction.

Construction began this month on the 276 rental residences in Phase II. The full build out of Phase II is scheduled for completion in the second quarter of 2018, with the first building scheduled for completion in the second quarter of 2017.

The KRE/Silverman partnership decided to begin construction of Phase II now because of the overwhelming success of Phase I, noting that demand for the community’s luxury apartments will soon outpace supply.

“The leasing pace at Madison Farms continues to be very strong,” says Jeremy Kaplan, chief operating officer of The KRE Group. “With 75 percent of our current apartments leased and activity in our retail village booming, we believe that now is the ideal time to launch Phase II and double down on our investment in this community.”

The rental success of Madison Farms mirrors the success of the retail village on the site, with more than a dozen shops and restaurants, including ShopRite, Starbucks and Pet Valu. Residents have a short walk to the retail village as well as to the community’s clubhouse and outdoor pool, providing the type of pedestrian-friendly experience the property’s developers envisioned. Pocket parks, ponds, bike paths and more are all planned for the community as well. Ultimately, the project will include 837 luxury residences built in multiple phases across approximately 100 acres of property.

The rental residences at Madison Farms range in size from 790 to 1,375 square feet. Six floorplans are available, including both one-bedroom, one-bath and two-bedroom, two-bath designs. Prices start from $1,320. Several buildings at Madison Farms are pet friendly and all of the facilities, including the apartments, will be smoke free. All buildings are elevator serviced. Amenities in the 7,500 square foot clubhouse include a state-of-the-art fitness center, yoga room, billiards, ping pong, media room, large screen TVs, and a lounge area with fireplace and WiFi.

Friday, June 24, 2016

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City Office REIT Sells Stabler Corporate Center Bldg

City Office REIT, Inc. has sold the Stabler Corporate Center building at 3501 Corporate Pky in Center Valley, PA to Gulf Islamic Investments LLC for $44.9 million, or about $252 per square foot.

The 178,330-square-foot building was built in 2006. It is anchored by the current tenant.

Petrucci Gets Warminster, PA, Luxury MF Development Underway

by Steve Lubetkin,
J.G. Petrucci Company has begun construction of Jacksonville Station, a 151-unit luxury multifamily apartment complex in Warminster, PA.

“J.G. Petrucci has made a $75 million investment since 2009, and we are very thankful for the time, faith and effort they have put into Warminster,” says Mark McKee, Warminster Township chairman. “We look forward to continuing this relationship as they embark on Jacksonville Station.”

Expected to open in Spring of 2017, Jacksonville Station will feature 151 one- and two-bedroom luxury apartment units, complete with modern amenities including stainless steel kitchen appliances, Quartz countertops, and full-size washers and dryers in each unit. Situated on a 10-acre land parcel directly across from the Warminster train station, the new multi-family complex will also feature on-site surface parking, a state-of-the-art fitness center, swimming pool, and a clubhouse.

Working closely with Township officials, J.G. Petrucci also has begun a $2 million road and parking improvement program in the area surrounding Jacksonville Station and the Station at Bucks County, a 257-unit multi-family complex also developed by Petrucci in 2012. The improvements include a new traffic signal, and the addition of a new, second roadway leading into the Warminster train station. In addition, Petrucci is creating 30 surface parking spaces within the existing train station parking lot, for use by Warminster Regional Line commuters.

“We are excited to begin our second multi-family development in Warminster and are very appreciative of the support we have received from the township officials and the local community—it has been a great pleasure to work with the entire team,” says Greg Rogerson, principal of J.G. Petrucci Company. “Warminster is viewed as an ideal location to live, work and play, and we are pleased to be creating another quality living option for its current and future residents.”
Designed by award-winning architects, Minno & Wasko, the eight-building multi-family development will feature 74 one-bedroom, and 77 two-bedroom apartments that are in close proximity to many retail shops, restaurants and public parks. Center City Philadelphia is a 50-minute train ride from Jacksonville Station, and nearby transportation routes include Routes 132, 332 and 263, as well as the Pennsylvania Turnpike. Jacksonville Station is situated within the Centennial School District.

Over the past two years, J.G. Petrucci has been increasing its presence in Warminster, with the acquisition of several retail, office and industrial facilities within a two-mile radius of Jacksonville Station. These properties include a 110,000-square-foot industrial building occupied by IWCO Direct, a 21,000-square-foot fully furnished office building, a 14,000-square-foot Walgreens retail store, and the Warminster Square and Jacksonville Plaza retail centers, where J.G. Petrucci has made significant improvements since the acquisition.

Poag And Ares Funds Acquire Warrington, PA, Lifestyle Center

by Steve Lubetkin,
A joint venture between affiliates of Poag Shopping Centers and real estate funds managed by Ares Management has rung the cash register for The Shops at Valley Square.

The joint venture has acquired the 292,888 square-foot mixed-use lifestyle center located in Warrington, Bucks County, PA, from iStar Financial. Built in 2007, the shopping plaza features 203,953 square feet of first-floor lifestyle retail and 88,935 square feet of second-floor professional office space.

“This community favorite is a beautifully designed gathering space with excellent stores and restaurants,” says Josh Poag, president and chief executive officer of Poag Shopping Centers. “We look forward to adding special touches and events that will make for an even better experience for families and individuals. There has been tremendous population growth in this area of the country during the past ten years, and we are pleased to expand our presence here and throughout the Northeast region.”

The Shops at Valley Square is a signature transaction within the suburbs of Philadelphia given its rare large size among lifestyle centers within the MSA,  With the dominant nature of the enclosed mall sector within the markets of King of Prussia, Cherry Hill and Willow Grove, most of the lifestyle centers that had been constructed over the past 15 years have been smaller in nature, raising the prominence of The Shops at Valley Square among the lifestyle tenants, the firm says.

“We are excited to partner with Poag, a real estate manager with proven expertise and success in commercial and retail investments across the US, in order to improve this property and maintain its position as one of the premier retail centers in the region,” says Steve Wolf, partner in the Ares Real Estate Group.  “The Shops at Valley Square is well located and known for offering an attractive mix of retail and dining alternatives.”

The Shops at Valley Square is part of a larger master planned development that is anchored by Wegmans Supermarket, an additional 167,500 square-foot power center, and approximately 200 townhouses.

Conveniently located at the prime intersection of Route 611 and Street Road in Warrington, the center is situated within one of Pennsylvania’s most affluent areas, Buck County, with average household incomes of $106,000 and average home values of $325,000. Retailers at the center include DSW, ULTA, Banana Republic, White House Black Market, and Loft. A sampling of restaurants includes P.F. Chang’s, Chipotle, Panera, The Melting Pot, and a local favorite, Carmel Kitchen & Wine Bar.

Friday, June 17, 2016

Benecon Group Renews Lease it Lititz

The Benecon Group, an employer benefits consulting firm, has signed a one-year lease renewal for 15,550 square feet in the office building at 147 W. Airport Rd. in Lititz, PA.

The two-story building totals 25,100 square feet in the Flyway Business Park. The building was delivered in 1991 in the Lancaster County submarket of Philadelphia. The Benecon Group’s lease includes the entire first floor and a portion of the second floor. The other tenant in the building is GeoNova.

Rainbow Relocating to Roosevelt Mall

Rainbow, a women's fashion retailer, has leased 17,040 square feet at Roosevelt Mall at 2329 Cottman Ave. in Philadelphia, PA.

Roosevelt Mall was built in 1964 and most recently renovated in 1988. The entire mall is just over 600,000 square feet on 36 acres, and is anchored by Macy's and Ross.

Turn5 Leases 76,000 SF in Royersford

Turn5, an e-commerce retailer headquartered in Malvern, signed a one-year lease for 76,000 square feet in the industrial building at 18 Railroad St. in Royersford, PA.

The building, owned by D & L Associates, totals 185,000 square feet. Other tenants include Zippy Shell and Bengal Paper.

Matrix Development Acquires 205 Acres At United Business Park In Shippensburg, PA

by Steve Lubetkin,
Matrix Development Group has acquired 205 acres of industrial land in United Business Park from the Cumberland Valley Regional Development Corporation.  The land is located in Shippensburg, PA, immediately off Interstate 81 at Exit 24, and has been approved for the development of two warehouse facilities totaling approximately 2.7 million square feet.

The site represented a great opportunity for Matrix to expand its development portfolio in central Pennsylvania, says Dave Thomas, vice president of industrial development for Matrix.

“The land in United Business Park represents one of the few sites along the Interstate 81 corridor where large-scale industrial development is truly feasible, with great access to I-81, utility infrastructure in place, and a strong workforce,” says Thomas.

Matrix is currently among the most active industrial developers in the Pennsylvania and New Jersey marketplace. It has developed more than 30 million square feet of industrial property, and has an additional 10 million square feet poised for build-to-suit delivery.  The addition of United Business Park to Matrix’s growing Pennsylvania portfolio allows the firm to offer various leasing and/or build-to-suit options.

“We are excited to have a developer of Matrix’s quality associated with the United Business Park,” says Dave Sciamanna, executive director of CVRDC.  “They did a phenomenal job with the World Kitchen property in southern Franklin County, and their presence in the park brings highly competitive, large scale, vertical development capability to the table.”

Matrix was represented by Lee & Associates of Eastern Pennsylvania in the transaction, led by Brian Knowles and John Van Buskirk.  Recently tapped by CVRDC to handle the marketing on the remainder of the park, Knowles and Van Buskirk will also be promoting the Matrix sites for lease.

“These sites are unique.  The ease of access to Interstate 81 is really remarkable, and Matrix has been very smart in the way they’ve programmed these sites with tons of parking and great onsite circulation”, says Van Buskirk.  “There just aren’t many opportunities of this caliber for building footprints at 1.2 million square feet and 1.5 million square feet in the Philadelphia market.  We expect the sites will be highly competitive as more and more companies like Procter & Gamble (1.7 million square feet) and Georgia-Pacific (1.5 million square feet) continue to draw on the efficiencies of scale offered by well-located large buildings able to effectively serve the Northeast and Mid-Atlantic populations.”

Thursday, June 16, 2016

Matrix Development Rides NJ Industrial Wave to Lease-up of Two Bldgs Totaling 1.25M SF

Matrix Development has announced the lease-up of two of its industrial buildings in New Jersey, totaling 1.25 million square feet in new lease deals in two of the state's hottest industrial markets, Salem County and South Brunswick.

Industrial vacancies across New Jersey are at a 16-year low, driven in part by large distribution center deals with several e-commerce providers, according to Matrix, which owns more than 15 million square feet of real estate across the state, most of it industrial. Industrial absorption is outpacing new construction in the area by three-fold, as rent prices continue to rise.

"We welcome TFH and to the Matrix family of tenants," said Alec Taylor, principal of Matrix Development Group, noting the two additions to a growing roster of Matrix clients that include Sony, Playmobil, Lenox and Volkswagen. "Each is a terrific company with which to do business, and proof that high quality buildings beget first class tenants."

Central Garden & Pet Signs Lease in the Garden State
TFH Publications, a division of California-based consumer brands company and producer of lawn and garden and pet supply products Central Garden & Pet, signed a lease for 550,000 square feet at 965 Cranbury South River Rd. in Monroe Twp., just 30 minutes from Newark Liberty International Airport and the Port of Newark.

The company will occupy the entire industrial building, delivered in December 2014 on 35.4 acres in the Exit 8A Industrial submarket of Middlesex County. It features 87 loading docks and four drive-ins, 36-foot clear heights, ESFR sprinkler, 3,000-amp heavy power and car and trailer parking. Opening Distribution Facility in Oldmans Twp
Hoboken, NJ-based e-commerce giant finalized a lease earlier this month for 705,000 square feet at 2 Gateway Blvd. in Pedricktown, NJ, in Salem County.

The company will occupy the entirety of Bldg 700 on 22.4 acres in Oldmans Twp., one of two speculative warehouse buildings in the Gateway Business Park, located adjacent to Exit 7 off I-295, just 45 minutes from Philadelphia. The 3.5 million-square-foot distribution park will provide immediate access to the Turnpike, with seamless overnight access to the Northeast and Mid-Atlantic regions.

Synchronoss Extends Lehigh Valley Lease

by Steve Lubetkin,
Synchronoss Technologies, a company that provides personal cloud solutions and software-based activation for connected devices, is extending its lease at 1555 Spillman Drive in Lehigh Valley Industrial Park VII, in Bethlehem, PA, owned by J.G. Petrucci Company.

“We are pleased to continue our relationship with Synchronoss,” says Jim Petrucci, founder and president of J.G. Petrucci Company. “It is a quality firm for LVIP VII, and they have created many jobs in the Lehigh Valley. We are proud to continue our relationship with one of the fastest-growing public tech companies, as recently ranked by Forbes.”

Synchronoss occupies the entire 62,000-square-foot building that serves clients such as Microsoft, Samsung, NFL, Apple, Verizon, AT&T, and Comcast.

In 2008, the company intended to expand its operations to Kansas, Texas and Florida, but after an 18-month search, chose a 9.6-acre parcel in the Lehigh Valley Industrial Park VII that provided it with access to public transportation routes; excellent proximity to Routes 412, 22, and 33; Interstate 78; and the Pennsylvania Turnpike. In addition, LVIP VII is one hour north of Philadelphia and just 90 minutes west of New York City.

J.G. Petrucci Company designed and built a single-story building for Synchronoss, which increased operational efficiencies and allowed the firm to customize the build out specific to the company’s business strategies. 1555 Spillman Drive is comprised of tilt-up concrete construction and a mix of open space and private offices. The building features over $5 million of specialized equipment and redundant electric.

Wednesday, June 15, 2016

LRS Acquiring 300K SF Industrial Site In Warminster, PA For $16M

by Steve Lubetkin,
LRS is acquiring 955 Mearns Road in Warminster, PA, a 303,000 square-foot facility with flexible space including office, warehouse, and light fabrication users, from MIM-Hayden Mearns for just over $16 million.

At the time of closing, the building was 96.5% occupied and featured a varied tenant mix and attractive lease terms.

“955 Mearns was a great cash flow producer for MIM‐Hayden. In the past few years, every time a tenant left the building they had a new tenant in place within months. It is a testament to the newfound strength in the American manufacturing sector, and how tight the industrial market is in Bucks County right now.”

“Considering the limited product available, 955 Mearns represented an excellent opportunity for my client to acquire a quality asset with a stabilized and diverse tenant base,” he says. “We are quite pleased with the purchase.”

The building is anchored by several International tenants, including SP Industries and ChemPump, who collectively occupy over 50 percent of the property.

Monday, June 13, 2016

Thomas Jefferson U. Hospital Anchored MOB Portfolio Up For Sale in Philadelphia

by Steve Lubetkin,
There is for sale a two-property, 86,000-square-foot medical office portfolio anchored by Thomas Jefferson University Hospital.

The portfolio is being marketed on behalf of an affiliate of G. Comfort & Sons on an unpriced basis.

The portfolio, which has undergone near complete renovations in the last year, consists of 8001 and 8040 Roosevelt Boulevard, which are 94.7% leased and anchored by Thomas Jefferson University Hospital.  Services offered at the facilities include urgent care, heart institute (and recent additional expansion space), vascular surgery, oral surgery, family practice, imaging, podiatry, dental, hematology oncology, periodontics & prosthetics and dermatology.  The properties are located in the far northeast submarket of Philadelphia, along US Route 1 just off of Trinity Health’s 231-bed Nazareth Hospital campus.  This location is within one mile of nearly 1,500 senior housing and age-restricted units.

“Philadelphia is nationally recognized and renowned as home to one of the largest concentrations of healthcare institutions, teaching hospitals, R&D, and pharmaceutical companies in the nation."

Thursday, June 9, 2016

Monthly Economic Outlook – May 2016 (Video)

Windtree Therapeutics Leases 31,000 SF in Warrington

Windtree Therapeutics, a biotechnology company focusing on therapies for respiratory diseases, has signed a 69-month lease for 30,506 square feet at 2600 Kelly Rd. in Warrington, PA.

The three-story building totals 61,776 square feet in the Stone Manor Corporate Center business park. The property was developed and is managed by Main Street Group and was completed in 2004.

The Northeast Will See An Influx Of Brands (Video)

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Post Brothers, MF Developer, Acquires Prime Center City Philadelphia Retail Properties

by Steve Lubetkin,
In what it calls “a strategic response to the rising demand for high street retail,” PH Retail—an affiliate of real estate company Post Brothers—has acquired a controlling interest in 1501-05 Walnut Street and 1520-22 Chestnut Street, with a total project cost in excess of $50 million.

Located on two of Philadelphia’s most desirable retail thoroughfares, the properties add 70,000 square feet of prime commercial space to PH Retail’s portfolio, which currently consists of assets valued in excess of $100 million.

“In recent years, we’ve witnessed an increasing number of retailers gravitate toward opening up locations on high streets. With Millennials and Baby Boomers moving into urban neighborhoods at an unprecedented pace, retailers are migrating to heavily trafficked city streets, where restaurants, cultural attractions and entertainment venues attract both affluent residents and tourists.”

Totaling 30,000 square feet of retail/restaurant space, 1501-1505 Walnut Street is home to AT&T Mobility’s flagship location and Club Monaco, and currently has one availability of 2,848 square feet.

Totaling more than 40,000 square feet, 1520-22 Chestnut Street features 27,000 square feet of above-grade space, and another 13,500 square feet below grade. Dollar Tree vacated the property earlier this year, creating an availability that will be sought after by the large number of retailers that are intent on establishing a foothold in Philadelphia’s downtown.

“This part of Center City is truly a live-work-play urban core, and high-end retailers are clamoring to gain access,” said Hope, who noted that, over the past five years, Philadelphia has welcomed retailers such as Barney’s Co-Op, Intermix, Lululemon, Apple, Theory, Madewell, Michael Kors, Uniqlo, H&M and Nordstrom Rack. “While Walnut Street has long been a retail hot spot, the demand for space in this section of the city has led to high-quality retail options along many of the neighboring corridors, with the most notable being Chestnut Street.”

PH Retail, which describes itself as “an opportunistic investor,” identifies properties with untapped potential, and optimizes their performance through capital improvements and innovative leasing strategies. PH Retail says its use of responsibly sourced building materials and efficiently designed buildings enhance the customer experience.

“These blocks of Walnut and Chestnut have some of the fastest-rising retail rents in the country, and we believe those numbers will continue to climb as demand for space outpaces supply,” Hope says. “As an increasing number of retailers eschew malls in favor of walkable, downtown locales, we are well positioned to acquire properties in Center City that are underutilized or not properly managed.”

Situated on two of Philadelphia’s most recognized streets, both 1501-1505 Walnut Street and 1520-22 Chestnut Street are convenient to the affluent residential base of Rittenhouse Square, the Avenue of the Arts on South Broad Street, Philadelphia’s flourishing tourism base, and several employee-dense office corridors.

PREIT "New Shell Chemical Plant Will ‘Revitalize The Trade Area"

by Steve Lubetkin,
Put a petrochemical plant less than two miles away from a shopping mall, and what do you get? In Pennsylvania, at least, you get ringing praise from the REIT that owns the mall.

Shell Chemical Appalachia says it has decided to build a major petrochemical plant in Potter Township, about 30 miles northwest of Pittsburgh, PA, and Pennsylvania Real Estate Investment Trust says it’s thrilled to have the plant less than two miles from PREIT’s Beaver Valley Mall.

Shell announced that construction on the chemical complex, which includes an ethylene cracker with polyethylene derivatives unit, will start in approximately 18 months, with commercial production expected to begin early in the next decade. Shell is acquiring a 1,000-acre former zinc smelting facility for the new plant site.

“Shell Chemicals has recently announced final investment decisions to expand alpha olefins production at our Geismar site in Louisiana and, with our partner CNOOC in China, to add a world-scale ethylene cracker with derivative units to our existing complex there,” says Graham van’t Hoff, executive vice president for Royal Dutch Shell’s global Chemicals business. “This third announcement demonstrates the growth of Shell in chemicals and strengthens our competitive advantage.”

The complex will use low-cost ethane from shale gas producers in the Marcellus and Utica basins to produce 1.6 million tons of polyethylene per year. Polyethylene is used in many products, from food packaging and containers to automotive components.

“We are encouraged by the progress being made toward the proposed new cracker plant.  This transaction creates tremendous opportunity for Beaver Valley Mall and sets the stage to completely revitalize the trade area,” says Joseph F. Coradino, PREIT CEO. “As plans move forward, the construction of this multibillion dollar facility will create significant economic activity and new jobs and produce nearly $5 billion in chemical output, making Monaca a critical piece of the manufacturing and industrial activity in the region.”

PREIT quotes a study by Robert Morris University’s School of Business from December 2014, which says construction of the plant is expected to result in an increase in construction and ancillary employment by an annual average of approximately 3,700-4,600 jobs in Pennsylvania over the five-year construction period.  Once the plant is open, it is expected that more than 5,000 plant and ancillary jobs will be created in Pennsylvania with approximately 400-900 in Beaver County.

The facility will be built on the banks of the Ohio River in Potter Township. Because of its close proximity to gas feedstock, the complex, and its customers, will benefit from shorter and more dependable supply chains, compared to supply from the Gulf Coast. The location is also ideal because more than 70 percent of North American polyethylene customers are within a 700-mile radius of Pittsburgh.

The project will bring new growth and jobs to the region, with up to 6,000 construction workers involved in building the new facility, and an expected 600 permanent employees when completed.

Tuesday, June 7, 2016

China's Love for U.S. Real Estate (Video)

MCB Joint Venture Sells Glenolden, PA Retail Center

by Steve Lubetkin,
MCB Real Estate and Alex Brown Realty have sold 140 N. MacDade Boulevard in Glenolden, PA, to Wharton Realty Group. Terms were not disclosed.

The property, a 108,587-square-foot grocery-anchored shopping center, features a newly renovated ShopRite and is fully occupied.

“The investor demand for grocery-anchored shopping centers is stronger than ever. Especially for the dominate stores in the market – in this case, ShopRite. Not only is the Glenolden store one of the leading supermarkets, but it is located in Delaware County, one of the most densely populated trade areas in the Philadelphia suburbs.”

ShopRite acquired the lease from A&P, which, as previously reported by, has been disposing of leases for a number of New Jersey and Pennsylvania locations as a consequence of its bankruptcy filing last year.

ShopRite invested a significant amount of money into the store’s renovations and remodel, and as of May 2015 was officially re-opened. As the dominate grocer in the Philadelphia area, ShopRite continues to expand its footprint throughout the market.

Monday, June 6, 2016

Patient First Medical Center In Devon, PA Sells For $2.86M

by Steve Lubetkin,
he Patient First Medical Center located at 133 Lancaster Avenue in Devon, PA, has sold for $2.858 million.

“The sale of the Patient First in Devon was a ‘win-win’ scenario as the seller achieved a very aggressive cap rate and the buyer acquired an irreplaceable piece of Philadelphia’s Main Line."

“Due to our marketing process we were able to expose, negotiate and close on the asset leased to a non-investment grade tenant before construction of the building was completed."

The 7,000 square-foot building is located directly in front of the Devon train station. With the sale of the property comes a 20 year corporately guaranteed ground lease and no landlord responsibilities of expenses.

Thursday, June 2, 2016

ICSC: International Council of Shopping Centers interview Tom McGee (Video)

Survey Finds Office Dwellers Lacking Light, Air, Quiet

by Steve Lubetkin,
Office workers continue to have limited access to daylight, experience poor air quality and uncomfortable temperatures and are distracted by too much noise in their workplace, according to a new national survey by a global building products company.

The responses from 400 office workers surveyed nationally by Saint-Gobain, one of the world’s largest building materials companies, point to a need to improve the quality of the office environment nationwide by creating spaces that are built to benefit employee well-being.

Such improvements, the study suggests, can have a significant impact on productivity, and ultimately, a company’s bottom line.

“The office environment is one of the most important elements of any company because it significantly impacts the most valuable asset — employees. With workplace satisfaction and productivity at stake, we believe it’s time workplaces reflect their significance,” says John Crowe, president and CEO of Saint-Gobain and CertainTeed Corporations. “For this reason, Saint-Gobain recently opened a new 65-acre North American headquarters that is designed to improve the quality of our employees’ lives and, in doing so, inspire them to create the next chapter of our 350-year innovation legacy.”

Saint-Gobain and its subsidiary SageGlass, which makes “electrochromic” glass that adjusts to daylight, conducted the study, which it called the 2016 Work Environment Survey.  As previously reported by, Saint-Gobain’s new office campus in Malvern, about 25 miles southwest of Philadelphia, embraces open, collaborative space designs, SageGlass windows, and other design elements that address the study’s work environment concerns.

“We’ve found that the expectations and the opportunities for people who work in these buildings has gone up,” Carmine Ferrigno, vice president of communications at Saint-Gobain, and a leader of the Work Environment Survey, tells exclusively. “Once you start that dialogue, you really do open a lot of doors in terms of how these buildings could adapt to people. Once you start asking the people who work there what they want out of the building, they really start to push the envelope. We’ve found that asking the occupants what their expectations are, you really find a better way to drive the evolution of buildings.”
One of the top factors affecting employee well-being is natural light. In fact, nearly nine in 10 (87 percent) survey respondents said they would prefer to work near a window most of the time. Despite this overwhelming desire to be exposed to natural light, 36 percent of office workers do not have a window near their work space.

Of those with access to a window, 65 percent have blinds or curtains that block sunlight at least some of the day. It’s not just sunlight being blocked, but the restorative benefits of the outdoors. In fact, 32 percent of those with window access rarely or never see pleasant vistas.

Those with access to daylight and views of the outdoors are experiencing the benefits, the survey showed. Among those who reported seeing sunlight at work, approximately two-thirds (68 percent) indicated sunlight improves their mood, while nearly half (47 percent) felt sunlight makes them more energized and around 4 in 10 felt more relaxed (41 percent) and less stressed (36 percent). More than a quarter (28 percent) felt exposure to sunlight at work makes them more productive.

Beyond sunlight, a connection to the natural environment was also found to have a significant impact on well-being, but too few are connecting to the outdoors. Only a quarter of those surveyed can see outdoor scenery and nearly one-third (32 percent) rarely or never see it. This is especially concerning when you consider the restorative benefits of nature that could be realized if more employees had access to outdoor views. More than half felt looking at natural scenery while at work relaxed them (61 percent), provided a good way to take a break (60 percent) and reduced their stress level (53 percent).

Millennials appear to be somewhat more adaptable and to new office designs and environments, says Ferrigno. “Gen-Xers and Baby Boomers are a little more reticent,” he says. “They tend to hang back a bit. Millennials are used to having a more fluid environment, but I’m finding that the Baby Boomers are the best advocates for this because their initial resistance is so high.”

“Daylight and a connection to the outdoors have a powerful impact on employee well-being and it’s concerning that many office workers spend most of their day in an environment with no access to natural light,” says Dr. Alan McLenaghan, CEO of SageGlass. “No matter the size or location of a company, the workplace is at the heart of a strong internal culture and therefore should be a space that is healthy and comfortable. If companies want happier and more productive employees, it’s time to evaluate the workplace they’re providing.”

Additional Survey Highlights:

The Temperature is Rarely Just Right - The majority of office workers felt that at least sometimes the temperature at work was too cool (73 percent) and/or too warm (63 percent).

Many Offices Have Poor Air Quality – Nearly half of respondents felt that at least sometimes at work they experienced stale air/poor air quality (47 percent) and/or there was not enough humidity/too dry (46 percent).

Noise is Problematic – Nearly two-thirds (65 percent) of office workers found themselves distracted and/or irritated by too much noise at work at least sometimes.

Access to Sunlight Impacts Job Satisfaction – Office workers who rarely or never see sunlight at work were less likely to be satisfied with their job than those who see sunlight at work at least sometimes (57 percent vs. 75 percent, respectively).

Artificial Lighting and Sunlight Need Better Control – In regards to lighting from sunlight and artificial lighting, more than one-third of office workers felt the following applied at work at least sometimes: the lighting was too bright (46 percent), irritating (36 percent) and/or distracting (36 percent).

MGM Resorts Buying Out Partner in Borgata Hotel Casino

MGM Resorts has doubled down on its bet on Atlantic City, striking a deal with its partner in the Borgata Hotel Casino, fellow casino-operator Boyd Gaming Corp., to buy out Boyd's 50% interest and gain full ownership over the upscale gaming property for $900 million.

The transaction, which is expected to net out for Boyd Gaming as $600 million in cash and approximately $300 milion in debt relief, includes the Borgata casino and its non-gambling Water Club hotel standing next door in the city's Marina District.

The property won't be on MGM Resorts' books for long, however. In a nifty piece of financial engineering, after completing the acquisition of Boyd Gaming's interest, MGM Resorts will sell the Borgata to its newly spun-off REIT, MGM Growth Properties (NYSE: MGP), for approximately $1.175 billion, and leaseback the property through a subsidiary.

The resort will be added to the master lease agreement between MGM Resorts and MGP, with the initial rent payment to MGP increased by $100 million. Under terms of the agreement, 90% of the rent will be fixed and contractually grow at 2% per year until 2022.

As for Boyd Gaming, the sale will enable it to reduce debt after it acquired three casinos in its home market of Las Vegas as part of a portfolio restructuring this year.

The transactions are expected to close in the third quarter of 2016, subject to regulatory approvals and other customary closing conditions.

MGM, which has designs on expanding its gaming operations across the east coast, is opening a major new casino just outside Washington DC later this year and another opening in Massachusetts in 2018. The Las Vegas firm is banking on a brighter future for Atlantic City, where four of the city’s 12 casinos have closed since 2014.

After opposing any bailout, New Jersey Governor Chris Christie relented last week and signed a financial rescue plan as the city teetered on the edge of bankruptcy.

"Borgata is the premier resort in Atlantic City and a great addition to our growing presence in the Northeast," said Jim Murren, Chairman and CEO of MGM Resorts International. "While the market continues to experience challenges, Borgata has outperformed and differentiated itself as the undisputed leader in the city."