Tuesday, March 31, 2020

Buyers Pull Out of Two New Jersey Shopping Center Sales Valued at $52 Million

A real estate investment trust's pending sales of two shopping centers in Bergen County, New Jersey, for $52.5 million have been scrapped because the prospective buyers pulled out of the deals.

First Real Estate Investment Trust of New Jersey, based in Hackensack, said the sales of both Franklin Crossing in Franklin Lakes, for $26.5 million, and Westwood Plaza in Westwood, for $26 million, have been terminated.

The REIT disclosed the end of the two separate deals in filings with the Securities and Exchange Commission. First Real Estate Investment didn't identify the prospective buyer in either of the transactions.

The REIT earlier this month saw another one of its pending sales fall through, for a multifamily property that was part of a portfolio New York City-based Kushner Cos. had been slated to acquire from it for $266.5 million. First Real Estate Investment reported that its mortgage lender for Pierre Towers, a 266-unit apartment complex at 185 Prospect Ave. in Hackensack, wouldn't agree to assign that loan to Kushner Cos. So the purchase agreement for that particular property, valued at $80.5 million, was canceled, bringing the portfolio's price tag down to $186 million.

Regarding Franklin Crossing, the REIT reported the would-be buyer prior to the end of a 21-day due diligence period "determined not to proceed with the purchase." That prospective purchaser's $500,000 deposit was returned.

In the Westwood Plaza sale, prior to the end of a 30-day due diligence period in that transaction, its suitor chose not to proceed with the purchase and got its $1 million deposit return.

The filings didn't say why the buyers declined to close on the sales, and First Real Estate Investment on Monday declined to comment beyond what was contained in the SEC documents.

Jared Kushner, the husband of President Trump's daughter Ivanka, once led Kushner Cos., which was founded by his father, Charles Kushner. But the younger Kushner stepped down from his role at the family company after he became a key adviser to the president. He is no longer involved in its daily operations.

In January, when First Real Estate Investment announced the pending portfolio sale to Kushner Cos., the REIT said it planned to wind down and proceed with a voluntary liquidation after that transaction closed.

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Monday, March 30, 2020

Boston Firm Adds Northeast Philadelphia Industrial Buildings to Growing Portfolio

Full service investment firm NorthBridge Partners has purchased a 281,000-square-foot, four-building portfolio in the Northeast Philadelphia industrial submarket from local development shop Anvil Construction for $25.5 million, or about $91 per square foot.

The properties in the Byberry East and West Section of the Philadelphia Industrial Park are located at 2722 Commerce Way, 2801-17 Southampton Road, 2825-45 Southampton Road and 2191 Hornig Road.

At the time of sale, the portfolio was 94% leased to 12 different tenants including United Natural Foods, Goodman Distribution, the City of Philadelphia, EIS and Riley Sales.

The team at Roddy Inc. will represent NorthBridge in the leasing of the Philadelphia industrial portfolio moving forward. There is currently 24,000 square feet of space available and tenant needs from 6,000 to 24,000 square feet can be accommodated.

Headquartered in Boston, NorthBridge Partners has invested more than $450 million of capital across over 30 separate investments totaling over 4 million square feet since its launch in 2014, according to its website.

New Jersey Unveils 90-Day Mortgage Grace Period in Wake of Pandemic

By Linda Moss CoStar News

Working with financial lenders, New Jersey has arranged for a 90-day grace period for mortgage payments throughout the state in response to the coronavirus pandemic, as confirmed cases of the illness rose to 11,124, No. 2 in the nation.

New Jersey Gov. Phil Murphy unveiled the mortgage-relief initiative for home owners financially hurt by the outbreak Saturday at a press briefing in the state capital in Trenton. The governor's announcement only pertains to residential mortgages, not those on commercial properties, according to a spokesman for his office. New Jersey now also has a 60-day ban on evictions.

Murphy, in an initiative that "closely mirrors" one underway in California, said the Garden State secured support from Citigroup, JPMorgan Chase, U.S. Bank, Wells Fargo and Bank of America in addition to over 40 other federal and state-chartered banks, credit unions, and servicers to offer financial protection to New Jersey home owners. More financial institutions are preparing to sign on in the coming days, according to a statement from the governor's office.

California Gov. Gavin Newsom announced a similar mortgage forbearance arrangement with Citigroup, JPMorgan Chase, U.S. Bank, and Wells Fargo last week. And on Friday Newsom ordered a statewide eviction moratorium, which bars residential landlords from evicting tenants unable to make their rent as a result of lost work, illness or being left to care for a family member because of the virus.
A number of states, not only California but New York and others, have ordered moratoriums on mortgage payments and evictions as residents financially struggle because of the health crisis, which has resulted in thousands of layoffs as businesses are forced to close. The Empire State has the most confirmed coronavirus cases nationally, with Gov. Andrew Cuomo reporting 52,318 as of Saturday.

April 1 looms

New Jersey's action comes in time to help those worried "as that April 1 payment date loomed especially large and foreboding," Murphy said, and builds on an earlier ban on evictions.

"Put together a 90-day grace period and a moratorium on foreclosures and evictions means many New Jersey families can breathe easier, keep their heads above water and have a place they can continue to to call home," the governor said.

Under New Jersey's plan, residents who are struggling financially as a result of COVID-19 may be eligible for relief but must reach out to their financial institutions.

Participaing lenders would offer, consistent with applicable guidelines:

  • Mortgage-payment forbearance of up to 90 days to borrowers economically impacted by the pandemic;
  • Provide borrowers a streamlined process to request a forbearance for COVID-19-related reasons, supported with available documentation;
  • Confirm approval of and terms of forbearance program;
  • Provide borrowers the opportunity to request additional relief, as practicable, upon continued showing of hardship due to COVID-19.

The New Jersey Bankers Association, CrossState Credit Union Association and the Mortgage Bankers Association of New Jersey have endorsed the mortgage-payment moratorium and are encouraging their members to adopt these policies, according to a statement from the governor's office.

No harm to credit rating

Home owners who take advantage of the mortgage forbearance won't see their credit ratings negatively impacted as a result, according to Murphy.

During his press conference, Murphy said for at least 90 days, financial institutions will waive or refund mortgage-related late fees and other fees, including early CD withdrawals, subject to applicable federal regulations, for customers who have sought assistance.

Last week, Murphy signed an executive order that imposed a moratorium on removing individuals from their homes pursuant to an eviction or foreclosure proceeding while the order is in effect. Tenants cannot be asked to leave their homes for nonpayment of rent during this time. Building on that order, mortgage lenders have committed to not initiating foreclosure sale or evictions for at least 60 days, the governor said.

The state Department of Community Affairs has received an additional $13 million in federal funds as part of its annual renewal for the Section 8 voucher Program, according to the governor. These funds, based on New Jersey increased use of the prgoram last year, "are critical to helping current voucher tenants maintain their housing stability during the coming year," the governor's office said in a statement.

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Wednesday, March 25, 2020

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Rubenstein Partners Announces New Leases, Launch of Capital Improvements at Makefield Crossing

by John Jordan Globest.com
Rubenstein Partners reports that it has secured more than 100,000 square feet in new lease deals at the Makefield Crossing office campus here in the last 12 months.

The Philadelphia-based real estate investment advisory firm, also notes that it has begun capital improvements involving both interior and exterior upgrades at the nearly 467,000-square-foot property. The capital improvements mark the first step in a larger plan to reposition and improve the Class A office park in Bucks County, PA.

Within the past 12 months, Rubenstein has signed four large leases exceeding 20,000 square feet each, including a new lease for 21,082 square feet with Biohaven Pharmaceuticals, a 21,690-square-foot renewal and expansion of Cello Health, and a 22,409-square-foot renewal and expansion of Jubilant Pharma, among other deals.

“New and existing tenants have embraced our previously announced capital improvement plan for Makefield Crossing, which we are now executing after securing unanimous approvals from the Township,” says Louis Merlini, VP of asset management at Rubenstein. “We believe that Makefield Crossing will become even more attractive to users as we proceed with our plans and the end result comes into focus.”

Rubenstein plans to completely overhaul both the North and South campuses of Makefield Crossing with market-leading amenities and best-in-class common area upgrades. Makefield Crossing North consists of five office buildings totaling 190,183 square feet, plus a Hampton Inn hotel that was not included in the acquisition.

Rubenstein’s planned upgrades to Makefield Crossing North include replacing the interior parking lot with a large, collaborative green space, adding new amenities including a fitness center, conference center, and café/tenant lounge, renovating building common areas including main lobbies, restrooms, and corridors and replacing signage.

Makefield Crossing South consists of four office buildings, of which Rubenstein acquired three buildings totaling 276,533 square feet. Rubenstein plans to improve Makefield Crossing South by adding and upgrading amenities including a fitness center, conference center, and full-service café and tenant lounge, replacing a portion of the interior parking lot with a collaborative green space connecting the new amenities to a series of waterfront decks, renovation of building common areas including main lobbies, restrooms, corridors and new signage.

Tuesday, March 24, 2020

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Philadelphia Is Among the Top Metropolitan Areas in the US for Industries to Most Likely Survive and Eventually Thrive Following This Crisis

By Adrian Ponsen CoStar Analytics
The coronavirus spread has reintroduced factors absent from Philadelphia's economy for almost a decade: widespread fear and uncertainty. As we are early in the onset and short on government data points collected after the virus' spread, any market analyst worth his or her salt will admit there will be a deluge of question marks hanging over the economic outlook during the next month or two.

However, it's still constructive to take stock of what we do know, in order to build up as clear a picture of the road ahead as possible.

First off, a painful near-term decline in Philly's economic figures is all but certain for this spring. To curb the virus' spread and prevent hospitals from being overwhelmed with patients, Pennsylvania and New Jersey governors both ordered all nonessential businesses to close on March 16.

How long are these monumental measures likely to stay in place? China’s aggressive lockdown measures lasted about two months. The CDC recently recommended cancelling or postponing any gatherings of 50 scheduled through mid-May. Johns Hopkins University School of Medicine’s infectious disease expert Morgan Katz expects meaningful improvements by early May. Meanwhile, Treasury Secretary Steven Mnuchin is at the center of the White House’s economic response to this crisis and says Republican senators’ proposed coronavirus relief bill, now under debate in the congress, aims to cushion businesses for 10-12 weeks of serious disruption. That would take us through early to mid-June.

Regardless of how long these shutdowns last, the leisure/hospitality sector and retail trade sectors will likely be some of the worst-affected major industries. They represent 10% and 8% of Philadelphia total employment, respectively.

Hit by department store closures and the shift to automated or online checkout, Philadelphia's retail employment was already on the decline before the onset of the virus. Considering how many national retailers’ balance sheets had already been eroding prior to the onset of this crisis, the retail market’s road ahead looks like a painful one.

Leisure and hospitality employment, supported mostly by restaurants, bars and hotels, had been one of the metropolitan area's fastest-growing employment sectors. Center City's blossoming nightlife has been a key ingredient to Philadelphia economic revival over the past 15 to 20 years. The fact that the industry is now at such high risk is probably the biggest existential threat posed by the coronavirus to Philadelphia’s ongoing revival.

But overall, the coronavirus and its accompanying economic shock do not pose major threats to the fundamental drivers of Philadelphia's economic renaissance over the past 15 to 20 years.

Philadelphia's industry mix positions it better than the vast majority of major U.S. cities to weather the negative economic impact of the coronavirus. Very few major U.S. markets have higher concentrations of the sector including healthcare, professional and business services which will likely remain most resilient in the months ahead.

Meanwhile, Philadelphia has relatively lower concentrations of the sectors now most at risk such as leisure and hospitality, retail and oil and gas extraction.

The city's status as a powerhouse of healthcare innovation only gains renewed importance as a result of the current tragedy and will be a key economic benefit as the number of U.S. residents aged 70 and older grows by 40% over the course of this new decade.

Meanwhile, the cost of living differential between Philadelphia and its nearby competitors, New York, Boston and Washington, D.C., remains massive. Philadelphia will continue to attract large net inflows of college-educated young adults moving from these places in search of more spacious housing and higher savings/disposable income.

In other words, for firms able to remain on offense during what will undoubtedly be challenging months ahead, Philadelphia remains an attractive destination for real estate investment capital seeking stable long-term growth, especially when stacked against other major metropolitan areas in the U.S.

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Wednesday, March 18, 2020

Paypal Signs New Lease Deal at Plymouth Meeting Property

An office lease in Plymouth Meeting, Pennsylvania, will have Paypal moving to 4000 Chemical Rd.

The tenant will take occupancy of 60,593 square feet in the five-story, 120,877-square-foot office property in the third quarter of 2020.

Arden Group Acquires Industrial Portfolio in $163M Deal

by John Jordan Globest.com
Locally-based Arden Group has secured a $163-million floating-rate loan with BlackRock and CIT Group for the purchase and recapitalization of a 12-asset industrial portfolio in six major markets throughout the United States.

Arden Group is acquiring a portfolio of assets from Avistone of Laguna Niguel, CA. The portfolio is spread across San Antonio and Dallas, TX; Atlanta, GA and Columbus, OH.
No financial terms of the portfolio purchase were disclosed.

Avistone assembled these assets through a series of transactions dating back to June 2014. The properties will be combined with two Philadelphia and Charlotte properties already acquired by Arden in the second half of 2018. The new financing will retire the securitized debt on the acquisition targets, while paying down the bridge loan on the Philadelphia and Charlotte assets.

“The recapitalized properties are optimally spread across six industrial markets throughout the country and leased to a diverse array of more than 300 tenants across various industries."

Nearly 90% occupied portfolio has staggered lease term rollover providing Arden Group downside protection.
Arden Group, which has regional offices in New York City and Miami has acquired and/or developed more than $4 billion of properties through joint ventures and discretionary investment funds since its founding in 1989.

Tuesday, March 17, 2020

The New Yorkers Are Coming! Migration Into Philadelphia From Nearby Cities Continues to Rise

CoStar released its market update video outlining the top five trends in Philadelphia’s apartment market heading into 2020 a few weeks ago. One of the key trends the video highlighted was the continued migration of college-educated renters into Philadelphia’s urban core.

Without these inflows, Philadelphia’s apartment occupancy rate wouldn’t be able to remain in healthy standing, given the record totals of new construction the market is now seeing. This means it’s important for investors to understand where Philly’s new residents are coming from and what’s driving them to the city in the first place.

While its reporting data is lagged by a few years, the Census Bureau’s County-to-County migration flows dataset is the best source for answering these questions. It shows that just in the past 10 years, there’s been a sea change in terms of migration patterns in and out of Philadelphia in a way that many nationally focused investors still don’t fully understand or appreciate.

During the early years coming out of the last recession, more Philadelphia residents left the city for New York City than vice versa. They left in search of better jobs, higher wages, more lively bars and restaurants, and they were whiling to tolerate New York’s higher cost of living as part of the trade-off.

But as the cost of living in New York has skyrocketed, and Philadelphia’s nightlife has begun to flourish, these migration flows have completely switched. The number of residents moving from New York City to Philadelphia is rising, and has begun to far surpass the number of residents moving in the opposite direction, which has been on the decline in recent years.

A similar trend holds for residents moving between the costly Washington, D.C., suburbs in Northern Virginia and Philadelphia.

Migration from the most expensive pockets of New England including cities such as Boston and Cambridge to Philadelphia are also on the rise, while fewer Philadelphians are moving in the opposite direction.

While cost of living differentials are driving these trends, there appears to be plenty of additional runway for Philadelphia’s migration inflows to continue. Average two-bedroom apartment rents in Boston and New York City range from $3,300 to $3,900 per month, twice Philly’s average rate of $1,700. Meanwhile, the gap in home prices between Philly and its regional competitors is even wider.

From an investor’s perspective, Philadelphia’s growing inflows provide much needed support for apartment leasing. Local millennials are increasingly buying homes, which has kept the metropolitan area’s homeownership rate rising slowly since 2018. But new migrants into the city are more likely to rent. According the most recent U.S. census, 72% of residents who moved into Philadelphia from outside the state during 2018 moved into renter-occupied households during their first year.

Monday, March 16, 2020

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Stockton University, Atlantic City Development Corp. to Build New Student Housing

by John Jordan Globest.com
Stockton University and the Atlantic City Development Corp. have announced a public-private partnership to build a new student residence hall at Stockton University Atlantic City.

Phase two of the partnership, which was announced on Friday, will involve the construction of a 140,000-square-foot building that will feature apartment-style living with a total of 416 beds. There will also be a lounge, meeting room and laundry facilities. Residents will have access to parking in the existing parking garage.
Published reports have put the cost of the new project at more than $60 million.

In consideration of precautions taken to stem the spread of the coronavirus, a planned March 27 groundbreaking for the new Residence Hall was postponed, according to an update provided by Stockton University on Saturday.
The construction will continue the public/private partnership with AC Devco, which developed the first Gateway initiative that includes the Stockton Atlantic City campus, South Jersey Gas headquarters and AtlantiCare Urgent Care.

“Stockton University and its partners set the stage for a new economic development strategy with the Gateway initiative,” said AC Devco President Christopher Paladino. “Today thousands of students, staff, visitors, and employees of Stockton, South Jersey Gas and AtlantiCare have changed the tempo of the streets of Chelsea. This Phase II investment will further add to the vibrancy of the neighborhood.”

Stockton Atlantic City opened in fall 2018 with an academic building, 543-bed residential complex and parking garage. This spring, almost 1,500 students are taking at least one class in the John F. Scarpa Academic Center.
Stockton President Harvey Kesselman said, “We are excited to be able to expand our presence in Atlantic City and contribute to creating a more diversified economy. The new residence hall will allow even more students to live, learn and earn in Atlantic City through academic, internship and employment opportunities.”

Demolition of the Eldredge Building is anticipated for the summer of 2020 with construction of the new Residence Hall to begin in the fall. The target completion date for students to move in is in the fall of 2022.

Thursday, March 12, 2020

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$64M New Health Facility Opens in King of Prussia

by John Jordan Globest.com
Main Line Health reports that it has opened its $64-million, 94,000-square-foot Maine Line Health King of Prussia facility here.

The new health center is home to Main Line Health’s first Women’s Specialty Center in collaboration with Axia Women’s Health. The new facility which opened on Monday is located in the Village at Valley Forge.
Jack Lynch, FACHE, president and CEO, Main Line Health, said of the new health center’s opening, “As we developed plans for Main Line Health King of Prussia, we really dove deep into researching what services and amenities are important to our community—specifically women. With our partners at Axia Women’s Health, we are essentially delivering a one-stop-shop for women to see their primary care physician and specialists in a seamless, coordinated manner and offering boutique-like amenities to complement that care.”

Some of the specialized services offered for women include: primary care, imaging and lab services, X-rays, Ultrasound, Dexascans, 3D mammograms, specialty care, autoimmune health, breast health, digestive care, emotional wellness, endocrinology, genetic risk, gynecological care, headache care, heart care, maternity care, occupational therapy, pelvic floor health, physical therapy, reproductive medicine, speech therapy, surgical consultation, vein care and weight and wellness.
Main Line Health King of Prussia will also house a second office for the Women’s Emotional Wellness Center, expanding the specialized outpatient behavioral health services provided to women and their families. Services include individual and group counseling, post-partum depression care, and mindfulness therapies, including yoga.

While the Women’s Specialty Center seeks to meet the health care needs of women, Main Line Health King of Prussia offers care for all members of the community.

Main Line Health King of Prussia also features Aneu Kitchen & Juicery, a teaching kitchen, interactive wellness classes, The Wellness Porch–a boutique, wellness-focused retail store and complimentary parking. A 6,500-square-foot rooftop farm will also be built and will have its own professional farmer. The produce grown on the farm will be donated to a local university, to the community of Norristown and used in the center’s cooking classes and other events.
The construction manager for Main Line Health King of Prussia was IMC Construction; the architect/interior designer was NELSON Worldwide; the women’s specialty consultant was Susan Black, Perkins Eastman Black; and the development manager was Anchor Health Properties.

Wednesday, March 11, 2020

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Center City Philadelphia Office Landlords Not Afraid to Ask for More

By Adrian Ponsen CoStar Analytics
Given the city’s notorious wage tax and slow-but-steady pace of office leasing, Center City Philadelphia office owners aren’t used to seeing their market listed at the top of the charts in national rankings. This is particularly the case given that the list of office tenants moving into Center City, while growing, is still somewhat limited.

However, Center City Philadelphia’s office market does stand out nationally for its low average vacancy, minimal new construction and a surge in college-educated residents moving into the Philadelphia area’s urban core. These trends are providing local office landlords and brokers the pricing power they need to raise asking rents at some of the fastest rates of any major central business district in the U.S.

The chart above draws on more than 5,400 office space listings with asking rents that have been posted on CoStar since the beginning of 2019. In order to provide a clearer picture of where office landlords are more bullish versus more bearish, this analysis focused on office listings that either increased or decreased their asking rent. Other changes in term or service types, for example from gross rent to triple net, were excluded.

The key takeaway: Office landlords and brokers have raised asking rents by 5% or more on a third of the office space listings in Philadelphia's Market Street West and Market Street East submarkets since the beginning of last year, while almost no landlords lowered listed rents. The strong average increases in asking rents outshine central business districts in many of the country’s largest cities including New York, Washington, D.C. and San Francisco.

This is one of the factors that appealed to investors who made large Center City Philadelphia office acquisitions over the past two years.

Manhattan-based Silverstein Properties and locally based Arden Group were responsible for last year’s largest Center City office acquisition, with their joint-venture purchase of the trophy-class BNY Mellon Center for $451.6 million, or $351 per square foot.

“When we acquired 1735 Market we knew that we were getting the premier multi-tenant office building in the city in the best location at 18th & Market St. directly across the street from the Comcast world headquarters,” Arden Group CEO Craig Spencer said in a statement provided to CoStar. “Combining the iconic trophy quality of the property with Philadelphia’s dynamic job growth, millennial population growth and residential migration into Center City has created an exciting environment where we have been able to grow rents much faster than we initially anticipated.”

“We and our partners at Arden Group and Migdal love Philadelphia for a lot of reasons,” he said. “The city has a fantastic lifestyle that is attracting young, creative people to live and work here. It has some of the country’s top colleges and universities and is strategically located between Washington, D.C. and New York City. The bottom line is that Philadelphia is a global destination that continues to attract leading businesses and their employees. Growth in office rents is a natural byproduct of the city’s continued growth and success.”

Meanwhile, Philadelphia’s notoriously high construction labor costs have helped to keep the amount of new office space coming to market to a minimum. This restrained growth in new office supply is likely another key contributor to rising asking rents.

However, high construction costs also mean increased tenant improvement allowances, which have partially offset the market’s recent rent gains.

“Five years ago, the average 10-year Class A office deal was getting around $50 per square foot in tenant improvement allowances. Now, that figure is looking more like $65 to $80 because of rising construction costs and sophistication of desired tenant build-outs. While we’ve seen great rent gains across the city’s office inventory, effective rates – what landlords are taking in after TI and concessions have been factored out – have seen more muted growth.”

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Tuesday, March 10, 2020

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SANT Properties Buys Former Macy’s at Neshaminy Mall

by John Jordan Globest.com
Kin Properties of Boca Raton, FL has sold the former Macy’s department store at the Neshaminy Mall here to SANT Properties of Huntington Valley, PA.

The deal for the 211,000-square-foot dark anchor at the Neshaminy Mall was reported by Colliers Retail team of Todd Sussman and Jon Kieserman, which has been appointed exclusive leasing agent for the property by the new ownership.
No financial terms of the transaction were disclosed.

Macy’s opened at Neshaminy Mall in 1968 (then Strawbridge’s) and closed amidst 100 store closings nationwide for the retailer that began in 2017 as it readjusted its business to growing online competition.

The new owner has reconceived the vacant box as a mix of large floor plate opportunities, new exterior facing small retail and/or restaurant tenants along with several new outparcels offering the potential to court statement restaurant operators to the mall complex.

In addition, flexible zoning allows for multiple uses that would encourage, fitness, entertainment, office and more.

“We are excited to be an integral part of the redevelopment of this parcel. The 16 acres and the former Macy’s box will certainly be the key to transforming one of the most strategically placed malls in the Tri-state area."
Brookfield purchased the entirety of the Neshaminy Mall, independent of Macy’s, in 2018. There are some reports that Brookfield is planning to undertake redevelopment and implement substantial improvements for the property.

Current Neshaminy Mall retailers Boscov’s and AMC anchor a mix of specialty shops that include Barnes & Noble, Hollister Co., H&M, Aéropostale, The Children’s Place, Express and Victoria’s Secret.

Monday, March 9, 2020

Cherry Hill Office Complex Changes Hands

by John Jordan Globest.com
The two-building office complex at 5 and 6 Executive Campus here has been sold for an undisclosed sum.

The seller was an institutional owner of the 166,979-square-foot complex.
The portfolio is located off State Route 70 one mile from State Route 38 and approximately 5.4 miles from Philadelphia. The buildings are also proximate to retail and restaurant amenities along with being within walking distance to the Cherry Hill Transit station, which offers service to Philadelphia within 30 minutes, and across the street from the NJ Transit bus stop.

No financial terms of the transaction were disclosed.
The 66,703-square-foot 5 Executive is a two-story office building that was completed in 1970, and 6 Executive is a four-story, 100,276-square-foot building that first opened in 1982. The value-add buildings are home to a roster of all credit-rated government agencies.

“We were very pleased to work with the seller on the disposition of these properties. They were able to take advantage of the market’s strong demand for office properties that offer stable cash flow and leasing upside.”
The office portfolio acquisition provides the buyer with a “unique opportunity to acquire in-place cash flow secured by government agency tenancy in one of Southern New Jersey’s premier office markets.”

Sunday, March 8, 2020

26-Store Dollar General Portfolio in Pennsylvania Trades for $36M

by John Jordan Globest.com
A portfolio of 26 single-tenant retail properties in Pennsylvania occupied by discount retailer Dollar General has changed hands in a deal valued at $36 million.

Brentwood, TN-based GBT Realty Corporation, which developed the properties over the past two years, sold the portfolio to a Virginia-based, private investment group that was completing a sizable 1031 exchange.

Averaging a consideration of $1.4 million per location, each free-standing store features approximately 9,000 square feet of retail space and is absolute, triple-net leased to Dollar General Corporation which has provided its corporate guarantee on each lease. The leases all have between 12 and 13 years remaining with rent increases in each option period. The properties are all located in key suburban markets throughout the State of Pennsylvania.

“Discount retail continues to thrive as Dollar General, and its peers, open more stores each year. For the net lease investor, these assets provide an attractive combination of credit, lease term, and passive ownership, making dollar stores some of the most actively traded net lease properties on the market.”
Fallon notes that he is heading the marketing for additional Dollar Store inventory, including seven new Dollar General stores located in Pennsylvania,  Ohio, Maine and Connecticut.

Dollar General currently operates more than 15,000 stores in 44 states and counting.

Friday, March 6, 2020

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Institutional Investor Sells Government Office Portfolio Near Philadelphia

An institutional investor has sold a value-add office portfolio totaling 166,969 square feet in Philadelphia’s Cherry Hill, New Jersey, suburb to a private investor.

The buildings at 5 and 6 Executive Campus are located off State Route 70, approximately 5 miles from downtown Philadelphia. The buildings are leased to a roster of all credit-rated government agencies.

The two-story office building at 5 Executive was built in 1970 and totals 66,703 square feet, and the four-story facility at 6 Executive, which opened its doors in 1982, totals 100,276 square feet. The buildings are within walking distance to the Cherry Hill Transit station.

“We were very pleased to work with the seller on the disposition of these properties. They were able to take advantage of the market’s strong demand for office properties that offer stable cash flow and leasing upside.”

Thursday, March 5, 2020

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Cannabis Company Buys New Jersey Warehouse

Columbia Care, which holds one of six licenses in New Jersey to cultivate cannabis, has purchased its first location in the Garden State.

The company, a global medical cannabis operation with licenses in 18 jurisdictions in the United States and Europe, bought a vacant industrial building in the southern part of the state at 1560 N. West Blvd. in Vineland for $2.6 million, according to CoStar data.

LS Capital, which was represented by NAI Mertz in the transaction, sold the 50,274-square-foot building to Columbia Care, which provides cannabis-based health and wellness options for patients.

The company has more than 25 locations throughout the United States and Puerto Rico, with one now in New Jersey. The state issued Columbia Care its cultivation license in 2018.

"New Jersey is moving to provide alternative healthcare for qualifying patients, and Columbia Care is a trusted and respected company in its industry. This property provides quality warehouse and office space, and a smart location, to support its business operations."

The building that Columbia Care purchased has 47,525 square feet of warehouse space with two drive-in doors, four platform loading docks and clear ceiling heights of 15 to 27 feet. Its 2,749-square-foot, two-story office space includes seven offices and four restrooms. The property is in close proximity to major highways including Routes 47 and 55, and is about 35 minutes from the Atlantic City Expressway.

Philadelphia Tops the Country on Monthly Small Business Hiring Index

by Ricahrd Lawson Costar News
Philadelphia bumped Phoenix out of the top spot on a monthly index that measures small business job growth.

A year ago, the City of Brotherly Love’s metropolitan area sat next to last on the index from payroll company Paychex and analytics company IHS Markit. Since then, the area has surged on the index by 2.76%, pushing Phoenix to third behind Tampa.

Though growth is strong, Philadelphia finished just shy of a 100 rating, which means small business job growth for all metropolitan areas is at a slower pace than the benchmark year in 2004.

Tennessee retained the top spot among the 20 most populous states, driven largely by growth in the Nashville area, which isn’t populous enough yet to put it in the top 20 for cities. Tennessee is followed by Florida, Virginia, Pennsylvania and Texas in the top 5 on the March index.

Paychex culls data from the payrolls of 350,000 of its clients that employ 50 or fewer people. Real estate investors look at job and wage data when deciding on the best places to put their money.

Overall, the index showed a slight uptick in hiring across the country as a whole for the third consecutive month. Martin Mucci, Paychex’s president and chief executive officer, said in a statement that the “results have yet to reflect any impact from cases" of the coronavirus, known as COVID-19, "which is expected to increase in the coming months.”

Small business hiring in the Philadelphia metropolitan area, which includes parts of New Jersey, has finally caught up to an area economy that has been doing well over the past few years, Jim Diffey, chief economist for Boston-based IHS, told CoStar News.

“For a while, I was shocked at how low they were performing,” Diffey said. “The readings a few years ago were too pessimistic.”

He said there are a lot of cranes in the Philadelphia area like a lot of cities around the country. Construction is a big with small business hiring.

Determining the breadth of businesses is more challenging. But the latest figures from the U.S. Bureau of Labor Statistics show that financial activities and professional and business services are the two sectors that have been growing the most between July and December of last year.

“Many outside investors aren’t aware that among the largest 15 metro areas in the U.S., Philly is near the very top of the list in terms of growth in college educated residents moving into its urban core,” said Adrian Ponsen, CoStar’s director of market analytics, based in Philadelphia.

He said that is “supporting a booming restaurant and entertainment scene in and around Center City Philadelphia, which has been one of the key contributors to small business growth.”

Plus, Philadelphia has a relatively low cost of living, he said. That is “increasingly attracting new residents, including entrepreneurs seeking relief from more cost prohibitive cities nearby such as New York and Washington, D.C., while fewer and fewer Philly residents are moving in the opposite direction every year.”

Tuesday, March 3, 2020

How will the real estate market will fare in 2020? (Video)


Opportunity Zone Update 2020 (Video)


Industrial Investments Acquires 21-Building South NJ Industrial Portfolio

by John Jordan Globest.com
An affiliate of Blue Bell, PA-based Industrial Investments, Inc. has purchased a 21-building industrial portfolio here for $16.05 million and plans further mixed-use development on available lots adjacent to its newly acquired properties.

The acquisition includes Bloomfield Business Park, which consists of 16 multi-tenant warehouse/flex buildings and five multi-tenant buildings along Commerce Lane in the Commerce Lane Business Park.
The portfolio was 98% occupied at the time of sale to 55 tenants. Michael T. Bown, Sr., partner, Industrial Investments, represented the buyer in the transaction.

Bloomfield Business Park was originally developed as a joint venture between The Bloom Organization and Tom Merryfield in the late 1980s/early 1990s in several phases. Each building is 10,500 square feet. The early stage buildings consisted of five units of 2,100 sf each with five front entrances, five electric services and five loading doors. The early stage buildings have drive-in loading only. In the later stages of construction, the buildings were built on larger lots that allowed for five tailgate loading doors in the back and drive-in doors on the end units.

Tenants in the portfolio include United Refrigeration, Cooper Electric, Bath Fitter, Terminix, ProSource and Ewing Irrigation.

Industrial Investments states in connection with its latest purchase: “We are delighted to expand our footprint in the South Jersey industrial market with the acquisition of the West Berlin portfolio of master-planned, well-manicured, multi-tenant industrial buildings with excellent accessibility to consumers, retail locations and major roadways.”

The firm added that it plans to further develop the property, utilizing available lots on Route 73 for build-to-suit opportunities for retail, office or industrial buildings up to 25,000 square feet each.

Monday, March 2, 2020

Maximizing Renewals | Commercial Real Estate Tips (Video)


Five Teams Make Short-List for Philadelphia Navy Yard Project

by John Jordan Globest.com
The PIDC announced on Friday that it had whittled down the more than 35 responses to an RFP issued last fall for a development partner on 109 acres at the Philadelphia Navy Yard to five development teams.

The five respondents now competing for the development solicitation are:
● Ensemble Real Estate Investments and Mosaic Partners;

● Gilbane Development Company and Jair Lynch Real Estate Partners;
● Hines;

● Hoffman and Associates, Gattuso Development Partners, and Synterra Partners and

● Trammell Crow Co.
The five teams on the shortlist have been invited to submit detailed proposals in a request for proposal stage, with final selection of a development partner scheduled to be made later this year.

“We are heartened by the many enthusiastic responses for the development opportunities at the Navy Yard,” says Kate McNamara, PIDC’s senior vice president, Navy Yard. “We believe that we have a strong pool of potential partners that will contribute to this next chapter of innovation and development at the Navy Yard and look forward to announcing a new development partner later this year.”

In September 2019, PIDC initiated a request for qualifications process that put a call out for prospective partners—real estate developers and end-users—capable of planning, delivering, and managing office, R&D, and mixed-use residential buildings on approximately 109 acres at the Navy Yard. The PIDC is Philadelphia’s public-private economic development corporation founded in 1958 by the City of Philadelphia and the Greater Philadelphia Chamber of Commerce,

More than 35 responses to the RFQ were received in December 2019. The development opportunity marks the only time since 2004 that PIDC has offered exclusive development rights and the first time that mixed-use multifamily development will be allowed at the Navy Yard.

The Philadelphia Navy Yard currently hosts approximately 15,000 employees and 170 employers who occupy 7.5 million square feet across a mix of property types, including office, retail, industrial, R&D and institution space. Since acquiring the 1,200-acre site from the federal government in 2000, PIDC has been the master developer and site operator of the Navy Yard on behalf of the Philadelphia Authority for Industrial Development.