Wednesday, May 24, 2017

Developers seize on Philadelphia where inventory is tight

Natalie Kostelni Reporter Philadelphia Business Journal
While there’s an increasing weariness that the multifamily rental market in Philadelphia is becoming overbuilt, developers such as David Perlman are finding a lack of inventory has made their bets on new for-sale projects less of a risk.

Perlman is moving forward with a new 43-unit residential development at 600 N. 5th St. in Northern Liberties and he’s confident the townhouses will sell. “We just completed 25 units across the street,” he said. “That took us two years to sell and that’s about a fair pace.”

Real estate agents have been bemoaning about the lack of inventory throughout the city and suburbs. In Philadelphia, the first quarter proved to be unusually strong despite what is typically viewed as a slow time of year because of the weather.

“Home sales volume in the first quarter was also both exceptionally and unusually strong,” according to a report by Drexel Unviersity’s Lindy Institute for Urban Innovation. The report later said that the activity was “exceptional because it was the strongest first quarter since 2007 and unusual because home sales activity typically declines from the fourth to the first quarter, due to the holidays and winter weathe … A likely driver of this seasonally uncharacteristic price appreciation is the very low level of current inventories.” Nationally, inventory has become an issue as well. Single-family housing starts rose to 835,000 in April, which is half a previous peak of 1.72 million in 2005.

“We’ve hit a point where there is so little inventory real estate agents are throwing out ridiculous numbers and getting them,” said Ori Feibush of OCF Realty, which builds houses in several Philadelphia neighborhoods including Point Breeze, Graduate Hospital and Old City. “You have two-and-a-half months of inventory, which is an incredibly unhealthy supply. I foresee that will continue.”

There are several factors influencing the lack of supply. A nearly 10-year focus on the multifamily rental market, what can be a lengthy approval process and an increased desire to live in Philadelphia have contributed to limiting how much new housing has hit the market. There are also signs that millennials, who have all but shunned buying a house over renting, are starting to come into the market to buy.

Full story:

3601 Market Street Apts Hits the Market

Southern Land Company, a residential developer, has put to market for sale its 363-unit apartment building at 3601 Market St. in Philadelphia, PA to prospective buyers.

The property is being listed without an asking price.

The 28-story, 443,000-square-foot multifamily property was built in August 2015 on nine-tenths of an acre in the University City MF submarket of Philadelphia County.

The LEED Silver-certified tower features 26,000 square feet of ground-floor retail space home to Jimmy Johns and Dunking Donuts beneath a mix of studios, efficiencies, one- and two-bedroom apartments and penthouses, seven elevators, concierge, business center, game room, fitness center, swimming pool, 200-stall parking garage and on-site management. The asset was 32 percent vacant at the time of sale, and asking rents range between $1,800 and $4,700 per month for apartments averaging between 427 and 1,543 square feet each.

Frank Theatres Cinebowl & Grille Preleases 68,000-SF at Granite Run

Frank Theatres Cinebowl & Grille has signed a lease deal to anchor the in-development Promenade at Granite Run shopping center expansion at 1067 W. Baltimore Pike in Media, PA.

The theater experience will open a new 68,115-square-foot location, its fourth in the state. The retailer, with locations along the southeast, provides a host of attractions ranging from movies, bowling, arcade games, and a bar and grill.

The Promenade at Granite Run lifestyle center originally delivered on 56 acres in 1974 and is currently undergoing an expansion which broke ground earlier this year and will total 886,585 square feet when it delivers to the Delaware County submarket of Philadelphia in the first quarter of 2018.

Tuesday, May 23, 2017

PREIT Puts Two More Malls Up for Sale

Philadelphia-based PREIT (NYSE: PEI) announced plans to sell two more of its regional malls after receiving unsolicited inquiries from potential buyers.

PREIT said it will pursue the sale of its 900,000-square-foot Logan Valley Mall in Altoona, PA, and the 600,000-square-foot Valley View Mall in LaCrosse, WI.

The REIT did not reveal the identities of the potential buyers or an expected sales timeline, but said any proceeds from the dispositions would be used to fund its redevelopment pipeline.

"PREIT has a demonstrated record of transforming and revitalizing the traditional mall model to capitalize on new opportunities and evolving trends in the market," said Joseph F. Coradino, CEO of PREIT. "To date, we have successfully sold 16 lower-productivity malls as part of our non-core property disposition program. With these additional dispositions, we are taking further action to strengthen our portfolio amid a challenging retail climate."

PREIT recently announced that midwest department store Herberger's would be relocating and expanding at Valley View Mall to fill Macy's former location. Owned by The Bon-Ton Stores Inc., Herberger's will move from its current 42,000-square-foot to the 100,000-square-foot space formerly occupied by Macy's. The move is expected in October 2017.

However, Logan Valley is PREIT's worst-performing property and Valley View ranks as its eighth-worst among the REIT's 22 remaining malls on a sales-per-square-foot basis, according to PRET's most recent quarterly financial disclosure. PREIT said selling the malls is expected to boost its portfolio’s sales by $10 per square foot.

Since initiating a major disposition strategy to prune low-sales properties and focus on its best-performing centers beginning in 2013, PREIT has netted about $730 million from selling 16 of its properties.

PREIT has also focused on revamping its tenant mix, adding more dining, exercise and entertainment options to appeal to changing shopper patterns.

"The historic view of the mall, heavily reliant on apparel and traditional retail, has expired and a new model is rising," said CEO Coradino. "Dining, entertainment and experiential concepts represent the mall of the future."

In recent leasing activity, PREIT leased 28,000 square feet to Dave & Buster's in its Capital City Mall in Harrisburg, PA. At Plymouth Meeting Mall near Philadelphia, PREIT signed a new tenant called 5 Wits, which offers live-action entertainment experience that immerses guests in realistic situations that includes hands-on challenges and requires teamwork," according to a description. The 14,000-square-foot space will be across from the mall's Legoland Discovery Center. PREIT also recently signed indoor cycling firm Cyclebar at its Plymouth Meeting center, offering what it describes as "high-energy workouts in a concert-like atmosphere."

"As the retail format lines continue to blur, we are capitalizing on owning quality properties in the best locations in their markets, capturing a wide variety of tenant interest," Coradino added. "At the same time, we are systematically reducing exposure to select department stores, driving increased net operating income and enhancing the consumer experience, thereby creating long term shareholder value and driving NAV."

Coradino said the REIT will also continue to engage in discussions with third parties as its looks to optimize its mall portfolio and increase shareholder value.

Private Equity Firms Sell Fort Washington Hilton Garden Inn

by Steve Lubetkin,
Ethika Investments, a real estate private equity firm says one of its investment funds has sold its interest in the Hilton Garden Inn Philadelphia/Ft. Washington hotel for $22.5 million. The buyer was not disclosed.

Acquired by Ethika in 2013 with fund sponsor Laurus Corp., the investors say they spent $2.5 million targeted renovation to public spaces and guest rooms, selection of a new management company, focused efforts to raise RevPAR, and strategic marketing bringing up guest satisfaction – winning Trip Advisor’s Certificate of Excellence 2013, 2014, 2015 and Aimbridge Hospitality’s Presidential Award for RevPAR Growth 2013, 2014, 2015. Laurus says the property achieved a 20.1 percent gross IRR and 1.9x gross equity multiple in under four years.

“This successful disposition underscores our strategy of investing in ideally located value-add assets in dynamic and flourishing markets around the US,” says Austin Khan, chief investment officer of Ethika Investments. “Through a diligent application of the value-add strategy by our affiliate, Laurus Corp., this hotel moved from an opportunistic investment to stabilization and sale to a core investor.”

Ethika and Laurus acquired the 146-key property in 2013 for a reported $16.4 million, according to Real Capital Analytics, a proprietary research database.

“The successful sale of this hotel, the second disposition for Laurus-sponsored assets within the past two weeks, continues to highlight our consistent ability to source, execute and monetize on opportunistic and value added real estate investments,” says Andres Szita, Laurus chairman.  “As always, we carefully evaluate each project and define a custom strategy for each property, aiming at delivering the best possible risk-adjusted outcomes.”

Weakening demand in commercial real estate? (Video)

Monday, May 22, 2017

Pharmaceutical Research Company Renews 28,000-SF Lease in DE

Incyte, a pharmaceutical research company, has renewed its lease for 28,460 square feet at the 2200 Concord Pike building at 2200 Concord Pike in Wilmington, DE.

Incyte occupies space on the ninth and 10th floors in the building it has called home since 2014. Founded in 2002, Incyte now employs more than 900 people across the U.S. and Europe.

Friday, May 19, 2017

Keystone, Argosy Sell Devon Square Offices

Westover Companies purchased the office buildings at 724 and 744 W. Lancaster Ave. in Wayne, PA from Keystone Property Group and Argosy Real Estate for $33.5 million, or about $245 per square foot.

The two buildings total 136,493 square feet on two floors and were built in 1984 and renovated in 2005. Devon Square was designed by Architectural Concepts PC and developed by Keystone Property Group.

Wednesday, May 17, 2017

CBRE Global Investors Acquire King Of Prussia Town Center

JBG Rosenfeld Retail Properties sold the open-air shopping center at 131 Town Center Rd. in King of Prussia, PA to a fund led by CBRE Global Investors. 

The newly-constructed, 263,423-square-foot retail center was 87 percent leased at the time of sale and features a walkable urban design combining a mix of necessity and experiential retailers in a town-center setup. The property is shadow-anchored by a Wegmans grocery store and is located in the King of Prussia / Wayne submarket of Montgomery County. 

"King of Prussia Town Center is a one-stop shopping and dining destination located on the border of Pennsylvania’s wealthiest counties, serving some of the nation’s most affluent and well-educated populations," said Kim Hourihan, portfolio manager with CBRE Global Investors on the submarket's average household income of more than $130,000. "The combination of attractive demographics and exceptional accessibility makes the property the ideal location for retailers and restaurants alike. As e-commerce has disrupted traditional retailers, necessity retail and destination restaurants drive daily traffic, enhance the shopping experience and offer protection against e-commerce risks affecting other retailers." 

The property is part of a 122-acre, master-planned, mixed-use development. The center was JBG's only development in suburban Philadelphia, and its sale marks the firm's effective exit from the region.

Thursday, May 11, 2017

Tips for Commercial Property Owners - EY's Global Real Estate Market Outlook (Video)

Sam Zell: I wouldn't let those virtual office guys near my business (Video)

DaVita Signs 16,000-SF Lease in Malvern

Healthcare provider DaVita, Inc. has leased 15,991 square feet of office space at 2476 Swedesford Rd. in Malvern, PA.

The 276,736-square foot office building was constructed in 1968 within the Great Valley Commerce Center located in the Exton/Whitelands submarket of Chester County.

Ace Hardware Signs Two Bldg Industrial Lease Totaling 1.1M SF

Ace Hardware has signed a 1.1 million-square-foot industrial lease at 139 Fredericksburg Rd. in Fredericksburg, PA.

The lease deal encompasses a full-building deal at an existing distribution facility totaling 874,126 square feet and a 225,875-square-foot proposed expansion building that is expected to break ground this summer with an anticipated delivery date in early 2018.

USAA Real Estate Company owns the 90-acre lot, located near I-78 and I-81, within the Lebanon Valley Distribution Center. Reportedly, Ace Hardware will not take occupancy of the existing space until the expansion building is completed.

The existing building delivered in May 2016 in the Lebanon County Industrial submarket of Philadelphia and features abundant surface and trailer parking, ESFR sprinkler, 123 loading docks and two drive-ins in a cross-dock design, 36-foot clear heights and 48x56-foot column spacing.

Supply, Affordability Issues Pressuring Apt. Rent Growth in Downtown Philadelphia

The stark contrast in recent apartment rent growth between the city and suburbs is notable. A majority of the new supply has been built in and around Philly’s CBD, and rents have been flat or even retreating the last few quarters in the downtown Center City and Art Museum/Northern Liberties submarkets. Even buzzworthy apartment-renting hot spots such as University City have seen slow to no rent growth, and new units are still coming.

Meanwhile, the major suburban apartment submarkets such as Conshohocken, Cherry Hill/Haddonfield and Main Line have seen the party continue with rent gains averaging closer to 4% or 5% year over year.

A lot of this is attributable to new supply pressure, but affordability is also a factor. There are only so many renters who can or will pony up for a $2,000-per month, one-bedroom unit in Center City. Similar amenities in nearby buildings that have access to public transportation and a rent bill that’s several hundred dollars less per month can be pretty compelling.

Sky Isn’t Falling on Center City Apt. Leasing Managers Just Yet

While the slowdown in rent growth is obvious, apartment assets in downtown Philly still have a lot going for them-and the biggest selling point is the city itself. I can’t tell you if an infiniti pool in Newtown Square is better than an infiniti pool in Rittenhouse Square, but I know which one is a few steps away from premier shopping, restaurants and more nightlife than just about every suburb in Philadelphia combined can offer.

This isn’t a value judgement on one or the other, by the way. Just an observation that you can’t replicate the city as an amenity, even in the most walkable town-center environment. Oh, and having the Comcast Technology Center and it’s thousands of well-paid employees commuting to your neck of the wood in less than a year is also pretty good consolation.

Compelling Multifamily Stories Emerging Outside Pennsylvania Portion of This Metro

There are two fascinating reclamation projects happening within the boundaries of the Philadelphia metro area, both are in nearby Delaware.

The city of Camden’s revival has received national attention because of all the tax incentives the state has offered to corporations to locate there. But the city needs population growth and the reclamation of the Camden waterfront could go a long way in that pursuit. Crime is down, tech startups are seeing a potential home base for their businesses and employees, and Camden could benefit from the urban pioneering spirit that many younger Philadelphians have.

Further south, Wilmington is undergoing a similar rebirth. Crime destroyed the city’s reputation and still plagues parts of it. For the longest time, there were very few viable rental housing options for employees at JP Morgan Chase, Bank of America, DowDuPont and others.

Much of Wilmington’s comeback story is being written by the Buccini/Pollin Group, which has made a goal of facilitating the addition of 5,000 new residents to Wilmington by 2020, where the company is based. Their principals are from the city and they have a genuine desire to see not just their projects succeed but their city as well.

Friday, May 5, 2017

Lehigh Valley Health Network Signs Leases at Three City Center

Lehigh Valley Health Network has signed leases totaling 82,000 square feet at the Three City Center building at 515 W. Hamilton St. in Allentown, PA.

The 210,000-square-foot office building is just two years young. The construction on the building was completed in May of 2015. Lehigh Valley Health Network will occupy space on the second, third and fourth floors of the building, taking 54,634 square feet in September 2017 and expanding into an additional 27,317 square feet in June 2018.

Thursday, May 4, 2017

Kimco Realty CEO: Retail getting painted with broad brush (Video)

High Street Raises $350 Million for Core-Plus Industrial Fund

High Street Realty Co. held final close on its High Street Real Estate Fund V reaching total equity commitments of $353 million.

Utilizing leverage of 50%, Fund V will seek to acquire $700 million of assets in its target markets.

San Francisco-based High Street Realty formed the fund to continue acquiring smaller warehouse distribution assets in the eastern two-thirds of the US, with a specific focus on Class A and B infill properties fulfilling regional and “last mile” logistics requirements.

Fund V will target primary distribution markets, including Chicago, Northern New Jersey, Central Pennsylvania, Atlanta, Florida and Texas.

The fund attracted capital from existing investors and several new top-tier, institutional investor relationships. Investors include insurance companies, public and corporate pension funds, foundations and other institutional investors from Europe.

To date, Fund V has acquired 19 assets that, in aggregate, represent approximately 34% of its total commitments.

Its most recent purchase occurred in March when it acquired three industrial properties in Morrow, GA, as part of the Southlake Distribution Centers from UBS Realty Investors LLC for $31.45 million, approximately $39 per square foot. Great-West Life & Annuity Insurance Co. provided $16.25 million in purchase financing.

Tuesday, May 2, 2017

DuPont Building Set for Major Overhual

The purchase of the DuPont Building and Hotel DuPont in Wilmington, DE has finalized, with the city’s most active developer - The Buccini/Pollin Group (BPG) - announcing its purchase from chemical company Chemours last week.

The DuPont spinoff has reportedly signed a 17-year leaseback of approximately 260,000 square feet at the property, which it acquired as part of its detachment from DuPont back in 2015.
While the price tag always matters, perhaps a more important number is $175 million - the projected price tag for BPG’s conversion of the outdated mixed-use asset into a defining centerpiece for the downtown’s ongoing transformation.

"The purchase of the DuPont Building and its assets couldn’t make any more sense to us right now," said Chris Buccini, co-president of The Buccini/Pollin Group. "There is no better way to coalesce our long-running vision for a vibrant downtown where people come together to live, work and play, than to take on the DuPont Building and re-envision it as a modern version of what it has always been, a lifestyle center for the City of Wilmington."

The Wilmington-based developer has been driving an effort there for the better part of two decades, and the DuPont Building deal aligns closely with the joint effort between BPG and the City of Wilmington to add 5,000 new residents to the area between 2015 and 2020. The renovation plans include gutting the existing office space and apportioning some of it for 180 apartment units. While the unit mix and asking rents haven’t been finalized, BPG has said that it expects rents to come in around $2/SF. This is in the range of the higher-end Residences brand that BPG has developed around the city.

The first phase of renovations is expected to take up to 18 months, and Chemours will reportedly take over temporary space in the Nemours Building next door until its open floor plan space located on floors four through 13 is available.

The remaining space, which could fit up to four tenants according to BPG, will be up for grabs in a submarket defined by elevated vacancy in that sector. According to recent data from CoStar Market Analytics, almost 15 percent of the 4 & 5-Star spaces in the Wilmington CBD submarket were unoccupied at the time of this trade. Less than 1 million square feet of office space has delivered here since 2000, and only one building over 100,000 square feet (the 160,000-square-foot AAA Building on River Place, fully leased) was over 90 percent occupied as of Q2-17.

In addition to the office component, the property will see overhauls of its hotel, retail and lobby spaces. Playing to the live-work-play concept dominating most major cities these days, the 40,000-square-foot retail plans involve 10,000 square feet dedicated to a planned food hall. The idea is to make both the office and apartments part of an 18-hour urban hot spot.

OMEGA CRE donates $5,100 o/b/o PennFleet to the B-Strong Foundation

Do Well by Doing Good  - OMEGA Commercial Real Estate, Inc.

The Story: 
 Joe O’Donnell of OMEGA Commercial Real Estate, Inc. and Jim Kolea of PennFleet began looking for a building for PennFleet many years ago. PennFleet had a unique requirement of certain size industrial building but with extra land for parking commercial vehicles. As Jim and Joe got to work together, Jim told Joe about a charity that was started by one of his employees and close to his heart as a cause.  That charity was the B-Strong Foundation. Joe agreed to donate a portion of his commission should Jim ever find a building to purchase. After many years of searching they finally located 591 Meetinghouse Road, Marcus Hook, PA. PennFleet settled on the property and recently relocated. Today PennFleet continues to thrive and hit new sales highs in their larger and more modern facility helps them to accomplish.

Jim Kolea, Tracy Ehleben & Joe O’Donnell

B-Strong Foundation is a 501(c)(3) non-profit organization, who provides meals, gifts and financial help to families whose children are diagnosed with cancer. Our families reside in the Delaware Valley area and we encourage them to Be Strong, Be Brave and BEAT cancer.

OMEGA Commercial Real Estate, Inc. is a full service real estate company specializing in corporate tenant/buyer representation, landlord/seller representation, project leasing and investment sales for Montgomery, Chester Counties and surrounding Philadelphia areas. @OmegaRE or

PennFleet  provides quality service and repairs for commercial vehicles.  PennFleet’s services include, collision repair and refinishing, mechanical services, media/sponge blasting & the sale of parts. @pennfleet or

How Trump's tax reform could save commercial real estate (Video)

Monday, May 1, 2017

Chester County’s commercial real estate sizzles

By Brian McCullough, Daily Local News
While the residential real estate market has rebounded from the last recession at a slow, uneven pace, Chester County’s commercial and industrial real estate markets have been going strong for a while, according to those in the business.

Leaders in the industry met at the Chester Valley Golf Club on Thursday to recognize those responsible for the top transactions of the last year and to hear from a Texas economist who gave an upbeat assessment of the national market.

“I would say it’s at least five years that we’ve been back from the recession,” said Adam Cathers, new president of the Chester County Commercial Industrial Investment Council, or CII Council, which put on Thursday’s event. “There’s a lot of both redevelopment within the boroughs and new corporate facilities. It’s been a nice mix of re-use and new.”

The CII Council was started as an informal networking group in the late 1980s and officially incorporated in 1994.

It now has 200 members – commercial and industrial developers, title companies, bankers, attorneys, real estate agents and others involved in commercial development.

“We do business everyday face to face,” said MaryFrances McGarrity of the CII Council. “We refer one another ... it’s a strong group that really enjoys doing business in Chester County.

The following recognitions were given by the group on Thursday:

• Best Collaboration of CII Members: Charlene Tucker of Interland Real Estate and Phil Earley and JoAnn West of Lieberman Earley & Co., and Bruce West of Manito Abstract Co., who worked together to bring about the sale of 782 Springdale Drive in Exton, a 42,000-square-foot Class A office building on 3.9 acres, for $3.5 million.

• Most Significant Land Sale - Adam Knox of Geis Realty Group for the sale of 1295 Ward Avenue in West Chester, an 8.3-acre parcel with a total value of $1.9 million.

• Most Significant Portfolio Sale - Jim Dugan of Neward Grubb Knight Frank for 412, 435, 436, 440 and 457 Creamery Way in Exton. The portfolio contained a total of 267,055 square feet of flex space and true office with a total value of $31.6 million. Taylor Young received special mention for representing the seller, Hayden Properties, on the transaction.

• Most Significant Flex Sale - Jim Lees of Swope Lees Commercial Real Estate for the sale of 901 S. Bolmar Street in West Chester, total of 89,920 square feet with a value of $8.7 million.

• Most Significant Flex Lease - Jack Purcell of the Hankin Group for leasing 260 Sierra Drive in Exton with a total of 41,557 square feet and a lease value of $14.1 million. Ed Hollin of Riley Riper Hollin & Colagreco represented the landlord.

• Most Significant Industrial Lease - Eric Stretch of First Liberty Partners for 231 W. Stewart Huston Drive in Coatesville, a 35,000-square-foot property with a total lease value of $1.3 million.

• Most Significant Industrial Sale - Eric Stretch of First Liberty Partners for the sale of 3172 Lower Valley Road in Parkesburg, which is the new location for Victory Brewing, a total of 212,000 square feet and a total value of $10.8 million.

• Most Significant Retail Lease - Nicole Lyddane and Chuck Swope of Swope Lees Commercial Real Estate for leasing Univest a total of 5,515 square feet high visibility space at 200 North High Street in West Chester. The lease had a $2.1 million value. Duie Latta of the Clarion law firm also worked on the transaction.

• Most Significant Office Lease - Cat Bianco of Workspace Property Trust for leasing 1400 Liberty Ridge in Wayne, a total of 104,818 square feet and a lease value of $14.3 million. Jim Dugan was given an honorable mention for his lease for 52 East Swedesford Road. The 21,008-square-foot building had a total lease value of $6 million.

• Most Significant Office Sale - Kevin Flynn of The Flynn Co. for 748,835 and 855 Springdale Drive, which had an aggregate of 118,000 square feet and a total value of $16 million. Taylor Young, who worked on the transaction, received an honorable mention.

The event’s keynote speaker, Mark Dotzour, an independent economist who served for 18 years as chief economist of the Real Estate Center at Texas A&M University in College Station, said the American commercial real estate market remains the envy of the world and produces better returns than the stock and bond markets as well as hedge funds. Don’t believe doom and gloom media reports, he advised.

“Our economy is the strongest on earth – period,” he said. “Everybody wants to invest here.”

Institutional and foreign investors will continue to snap up American real estate due to those higher returns, said Dotzour, who acknowledged that as an economist he could be wrong “about 50 percent of the time ... I’m due for a big miss.”

“It will end when commercial real estate has a viable alternative” Dotzour said of the market’s attractiveness to large investors.
Full story:

Philadelphia's Office Vacancy Decreases to 8.7%

The Philadelphia Office market ended the first quarter 2017 with a vacancy rate of 8.7%.

The vacancy rate was down over the previous quarter, with net absorption totaling positive 173,096 square feet in the first quarter. That compares to positive 1,080,044 square feet in the fourth quarter 2016. Vacant sublease space increased in the quarter, ending the quarter at 1,112,547 square feet.

The Class-A office market recorded net absorption of negative 588,125 square feet in the first quarter 2017, while net absorption for Philadelphia's central business district was negative 4,710 square feet.

Tenants moving into large blocks of space in 2017 include: Ashfield Healthcare moving into 82,000 square feet at 1100 Virginia Dr; WeWork moving into 55,238 square feet at 1900 Market Street; and Holy Redeemer Health System moving into 36,000 square feet at 201 Veterans Way.

Rental rates ended the first quarter at $22.68, an increase over the previous quarter.

A total of six buildings delivered to the market in the quarter totaling 214,556 square feet, with 4,398,979 square feet still under construction at the end of the quarter.

This trend is compared to the U.S. National Office vacancy rate, which stayed at 9.7%, relatively unchanged from the previous quarter, with net absorption positive 10.78 million square feet in the first quarter. Average rental rates increased to $24.44, and 339 office buildings delivered this quarter totaling more than 21.29 million square feet, with 154.4 million square feet still under construction.