Tuesday, June 30, 2020

The Carlton Group Closes $153M in Equity for a Philadelphia Multifamily

By Ingrid Tunberg Globest.com
The Carlton Group has closed on a $153 million joint-venture equity investment for a 346-unit, class A, multifamily development in downtown Philadelphia within an Opportunity Zone.

The joint-venture equity was sourced from an international family office, on behalf of the Carlton Group’s client, a Salt Lake City-based multifamily owner-operator.
Executing the transaction on behalf of the firm, was the Carlton Group’s CEO Michael Campbell, managing director, Kyle Morque and director, Chad Roberson.

Expecting Opportunity Zone development activity and interest to remain high among investors, the company plans to bring additional Opportunity Zone offerings to market in the coming months.

“Carlton’s ability to access Opportunity Zone-focused equity for this transaction is indicative of our global reach and relationships with investors who have divergent investment goals and tax mandates. We pride ourselves on our tireless work ethic and ability to identify non-traditional, off-the-radar foreign and domestic investors and lenders,” said Campbell.

Friday, June 26, 2020

Portfolio of 7 buildings sells for $14.9M in NJ

Michelle Caffrey Reporter
Philadelphia Business Journal

A seven-building portfolio of single-story office buildings in Mount Laurel sold for $14.85 million to a buyer who’s now amassed more than 400,000 square feet of single-story office space in the region. The sale comes as those types of properties, which often have private entrances, could see increased demand from employers looking to avoid shared common areas like lobbies and elevators to minimize Covid-19 risk. 

The seven buildings total 244,000 square feet of space and are located at 11000, 12000, 14000, 15000, 17000 and 18000 Commerce Parkway in the Greentree North Corporate Center, as well as 1001 Briggs Rd. in Cambridge Crossing. The buyer, Brooklyn-based Golden Gate Capital, is renaming the Greentree North Center to the Mount Laurel Commerce Center. 

The seller was Connecticut-based real estate investment firm Greenfield Partners, according to public property records. The most recent sale is the last piece of a larger South Jersey office portfolio it acquired from Liberty Property Trust in 2014 and has slowly sold off over the past three years, said 

Most of the properties Greenfield has sold off have been 100% leased out, or close to it, including a two-building portfolio of single-story offices at 1015 and 1025 Briggs Rd. in Mount Laurel it sold for $13.7 million last fall. 

The Greentree and Cambridge Crossing portfolio, however, is about 50% occupied on average, with some buildings fully leased and others completely vacant. One of the largest tenants is applicant screening firm Vertical Screen.

Since the properties were the last ones Greenfield still held in the region, he said they were willing to sell now instead of waiting until they’re fully leased. 

The property was marketed and buyer was identified before the Covid-19 pandemic hit, but the deal took a little while longer to complete because of uncertainty in the market, Marzullo said. Golden Gate was able to secure credit union financing for the fully-leased properties, but bridge financing for the value-add portion fell through as Covid-19 shook up financial markets. Once CBRE was able to help the buyer secure another loan from a new lender, Marzullo said, they were back on track. 

“We had a seller and a buyer who were very committed to selling and getting to closing, and we finally got it there,” he said. 

Commercial Real Estate Sales Fall 24% to $39.1 Billion

By Mark Heschmeyer CoStar News
Commercial real estate pricing dropped during a dramatic slowdown in transaction volume during the coronavirus pandemic, according to the latest monthly CoStar Commercial Repeat Sale Indices.

The repeat sales of $39.1 billion for the first five months of 2020 fell 24.2% from the same time a year earlier. This is the first look at the year's commercial real estate pricing trends, calculated by using the price change from the pair of first and second sales of properties sold multiple times. The indices are based on 538 repeat sales in May and more than 227,324 since 1996.

“While volume generally held up well versus the prior year in the first three months of 2020, it dropped more precipitously in April and May, reflecting overall caution among investors as well as physical challenges in transacting deals in a lockdown,” said Nancy Muscatello, managing consultant for CoStar. “The deceleration in deal volume was felt across the size and building-quality spectrum.”

In the investment-grade property segment, repeat sales volume was down 25.1% in the first five months of 2020 compared to the same time a year earlier. The group reflects larger asset sales common in major markets.

The general commercial segment, which reflects the more numerous but lower-priced property sales typical of secondary and smaller markets, was down 22.4%.

Both of the two major composite price indices declined in May, reflecting investor uncertainty and slower deal volume. However, both indices were still up between 3% to 5% on an annual basis over more than two decades.
The equal-weighted U.S. Composite Index, which reflects the more numerous, but lower-priced property sales typical of secondary and smaller markets, fell 1.3% but was still up over time.
The value-weighted U.S. Composite Index, which reflects larger asset sales common in major markets, declined by a more modest 0.1% in May after gaining since the Great Recession
The rate of commercial construction deliveries has also slowed due in part to delays stemming from lockdown measures in some states. Deliveries as a percent of total inventory across the three major property types — office, retail and industrial — are projected to total 515 million square feet in the 12 months ending in June, down 5.2% from the same time a year earlier.

Notably too, the rate of construction completions going into the pandemic is also much lower than at the peak of the last cycle of economic expansion. During the height of that growth between 2007 and 2008, quarterly deliveries averaged 0.44% of total building inventory. In the past four quarters through June, deliveries averaged just 0.23% of total inventory.

“More subdued construction levels going into a downturn may help to blunt the impact of weaker demand on vacancy rates,” Muscatello said.

Amazon to Open 14 Delivery Stations in New Jersey

by Linda Moss Costar 
As it continues to expand its distribution network, e-commerce giant Amazon has leased sites to open more than a dozen new delivery stations in New Jersey this year.

The Seattle-based company's delivery stations handle the so-called last mile of its delivery process, with packages sent to them from Amazon fulfillment centers. At the delivery stations, those packages are sorted and then loaded into vehicles for delivery directly to customers.

One of the 14 leases that Amazon has signed in the Garden State is for 109,086 square feet at 555 MacArthur Blvd. in Mahwah, where it launched its delivery station last month, the company said Thursday.

"We are excited to continue to invest in the state of New Jersey with new delivery stations that will provide efficient delivery for customers, and create thousands of job opportunities for the talented workforce,” Amazon spokeswoman Emily Hawkins said in an email.

Amazon, a major driver of industrial leasing in New Jersey, has been hustling to handle the surge of orders it has seen from people locked down in their home due to the coronavirus pandemic. It is the most active company to take U.S. warehouse space since the COVID-19 outbreak began, signing 38 new deals spanning almost 20 million square feet, according to CoStar data. And it is one of the largest occupiers of smaller warehouse buildings, with more than 80% of its deals last year for small- and medium-size buildings, according to CoStar.

Earlier this week, Amazon confirmed it was leasing a planned 868,000-square-foot multistory warehouse at 55-15 Grand Ave. in the Maspeth section of Queens in New York City, where it expects to use about 117,000 square feet for a delivery station and the rest for parking.

In addition to Mahwah, Amazon said it has signed leases for space in New Jersey at:
  • Paddock Street, Avenel.
  • International Drive S, Budd Lake.
  • Moonachie Avenue, Carlstadt.
  • Washington Avenue, Carlstadt.
  • Thomas McGovern Drive, Jersey City.
  • Court South, Edison.
  • Central Avenue, Kearny.
  • Logistics Drive, Kearny.
  • Lower Road, Linden.
  • Center Square Road, Logan Township.
  • Delancy Street, Newark.
  • North Street, Teterboro.
  • Forest Parkway, West Deptford.
Collectively, the stations will create thousands of full-time and part-time jobs, paying a minimum of $15 per hour. Amazon has more than 150 U.S. delivery stations, according to Hawkins.

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Thursday, June 25, 2020

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LCOR Breaks Ground on Transit-Oriented Apartment Complex Near Philadelphia

LCOR, a full service investment, management and development firm, broke ground on 51 Washington Street, a 304-unit apartment complex in Conshohocken, Pennsylvania, located approximately 15 miles from Philadelphia’s Center City district.

Slated to be completed in early fall 2022, the transit-oriented development is steps away from Conshohocken’s new regional Southeastern Pennsylvania Transportation Authority (SEPTA) station.

Plans for the development include a mix of studio, one- and two-bedroom floor plan configurations, and 17,000 square feet of amenity and management space, including an outdoor pool and interior courtyard. The seven-story project adjacent to the Schuylkill River Trail will feature a two-level garage offering approximately 366 parking spaces.

The project marks LCOR’s fourth development in the area, adding to Arlo in Malvern, 1919 Market Street in Philadelphia and Heathergate at Oxford Valley in Langhorne.

“Upon completion, 51 Washington Street will present this community with an exceptional and unique living experience,” Peter DiLullo, senior vice president and principal of LCOR, said in a statement. “We’re excited to work in close partnership with the Borough of Conshohocken and SEPTA to improve access the new transit station and waterfront.”

Amenity highlights include various entertainment areas such as a golf simulator, clubroom, formal lounge and covered outdoor space overlooking a swimming pool with waterfall edge and sun shelf, according to a press release. Additional amenities include a sizeable fitness center, along with break-out pods ideal for working from home.

Over its 40-year history, the Bethesda, Maryland-based development firm has applied its comprehensive expertise and fully integrated investment management and development strategy to more than 300 large-scale mixed-use projects, according to its website.

Niles Bolton Associates serves as the project's architect, and the construction manager is CBG Building Company. Construction financing was provided by Webster Bank.

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Wednesday, June 24, 2020

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Oliver Tyrone Pulver Corp. Reveals Plans for New Office Tower in Center City Philadelphia

Oliver Tyrone Pulver Corp. (OTP) has revealed plans for a new office tower at 1301 Market St. located in the heart of Center City Philadelphia.

"This tower is designed to deliver the most beautiful, efficient and productive office space in Philadelphia," Donald Pulver, president of OTP, said in a statement. "Offices that are perfectly located and perfectly designed are nearly impossible to find, and this will be the only one available in Philadelphia. Tenants will be able to attract, retain and inspire the best talent and operate most efficiently in this brand-new space."

The project is designed by internationally renowned architects Skidmore, Owings & Merrill.

"This property was developed to appeal to today's most forward-looking tenants," Healy said. "Trends show that top talent demands unmatched amenities, so new tenants at 1301 Market have the advantage of attracting and retaining the best and brightest from our region and beyond."

Amenities at 1301 Market will include a 10,000-square-foot fitness center, outdoor terraces, café, bike lockers, conference rooms, tech-enabled casual workspaces and a two-story, glass-enclosed marble lobby.

Lower levels will offer 25,200-square-foot floor plates, and upper floors will have 17,000-square-foot floors with ample natural light and views.

OTP has developed more than 15 million square feet of first-class office space in major U.S. cities and suburbs, including 5 million square feet in Philadelphia, according to its website.

The tower, which is planned to deliver up to 700,000 square feet on up to 30 floors, is slated to be completed in 2023.

Tuesday, June 23, 2020

Three Reasons COVID-19 Won’t Reverse Philadelphia’s Long-Term Urban Revival

By Adrian Ponsen CoStar Market Analytics 

The coronavirus has thrust Greater Center City Philadelphia’s real estate market into turmoil. Few renters are looking to move at all given the current circumstances, and the rare ones who are on the move aren’t exactly flocking to smaller units in dense, urban areas.

Weary of forcing their employees back into crowded spaces, many major Market Street corporate tenants can barely get their offices back up and running. The finances of restaurants Philadelphians normally flock to are in tatters.

It’s tempting to think the long-term economic revival the city has experienced over the past two decades will reverse given these pressures. Here are three reasons why that likely won’t happen:

1. Recent Healthcare and Life Science Expansions Remain Concentrated in Philadelphia’s Urban Core

With more than 16 million Americans set to age past 70 in the coming decade, the healthcare and life sciences sectors are the Philadelphia area’s most promising economic drivers by a long shot. Their recent local expansions have also been highly concentrated in Philadelphia’s urban core.
Apart from some key deals signed at Discovery Labs in Montgomery County, nearly all the area’s recent leases signed by growing life sciences innovators, including Century Therapeutics, Spark Therapeutics and Wistar Institute, have been tied to properties in the Navy Yard or University City.

Philadelphia’s life sciences pioneers are gravitating to these more expensive urban locations because proximity to Philadelphia’s major universities, startup incubators, and hospitals is critical to their success.

The same applies to Philadelphia’s healthcare giants. Penn Medicine’s largest ever capital project, a 1.5 million-square-foot hospital, dubbed the Pavilion, is on track to complete construction in University City by early 2021. Jefferson Health recently received a $70 million donation, bringing it closer to groundbreaking on a 225,000-square-foot biomedical research facility at 9th Street and Locust Street, and also announced plans to build a 23-story ambulatory care center at 11th Street and Chestnut Street.
2. Millennials’ Preference for Urban Philadelphia Living is Not a Fad

America’s largest demographic cohort, the millennials, are fast aging into their early 30s. Many believe this will create and exodus from cities back to the suburbs, as growing numbers of middle-aged urban professionals have kids, demand more space and seek better-funded public schools.

In Philadelphia, the data does not support this thesis, at least not for college-educated millennials.

The NAHB has been surveying individuals born between 1980 and 1996 on their housing preferences for more than 10 years. Even as more of their survey respondents age well into their 30s, their preference for urban living has only grown dramatically.
Meanwhile, Philadelphia is vastly more affordable than most large U.S. cities. The housing cost constraints that force other cities’ millennials into the suburbs are not as strong here. This has helped not only retain millennials from nearby suburbs, but also attracted larger numbers of them from more expensive cities nearby.

Growth in college-educated residents aged 18-34 has continued at a rapid pace in Philadelphia, while remaining relatively flat in most nearby suburban counties.
The city has even outperformed the suburbs in growth of college educated residents aged 35-44. This is a harbinger of future housing demand within city limits, and a clear sign that aging into the mid-30s doesn’t automatically prompt a move to the suburbs as some fear.
3. Emerging Shortages of Skilled Workers Will Pull Employers Into Central-Locations

With members of the massive baby boomer generation continuing to pass retirement age during the 2020s, America is on track for by far the slowest working age population growth in its modern history.
This will likely bring more intense skilled labor shortages and competition for knowledge workers, making it more and more critical for companies to locate close to universities and close to the neighborhoods where recent grads prefer to live, all to better compete at building internship pipelines and hiring young talent.

Skilled labor shortages should also incentivize companies to grow in locations that can source workers from the widest possible areas. In that environment, Center City’s vast public transit network, which pulls in commuters from across three states, could prove even more critical.

There’s no question that Center City’s economy and real estate markets are in for a rough patch over the next several months. The city’s sheer number of job losses, degraded tax revenues, and crippled hospitality industry present immense challenges. But Philadelphia’s long-term re-urbanization of wealth is not likely to reverse over the next decade. There are too many powerful forces pushing in the opposite direction.

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Thursday, June 18, 2020

Veltek expanding Exton footprint by 115,000 square feet

by Natalie Kostelni Philadelphia Business Journal
Veltek Associates Inc., a privately held maker of sanitizers, sterile disinfectants and other products for the pharmaceutical and health care industries, is expanding by 115,000 square feet in Exton.

West Whiteland officials approved a land development plan for the construction of what will be an addition to an existing two-story, 60,000-square-foot building at 475 Creamery Way in the Oaklands Corporate Center. E. Kahn Development Co. owns the property and will develop the addition for Veltek. 

Veltek has had a presence in Exton since 2010. Earlier this year, the company renewed its lease for 150,000 square feet at 1 Tabas Lane. It operates a facility at 15 Lee Blvd. in Malvern.

The company was formed in 1981 by Arthur L. Vellutato Sr., a former Merck & Co. researcher. When the senior Vellutato died in 2009 his son, Arthur L. Vellutato Jr., took over as CEO of the company. It has several divisions that thrive under regular circumstances but has found increased demand during the coronavirus pandemic.

The company makes a variety of sanitizers, disinfectants, cleaners and other related products used by pharmaceutical, biotechnology and healthcare companies in their manufacturing facilities. In addition, it has what it refers to as a "disposal products manufacturing" division that makes sterile and non-sterile disposable garments, face masks and other items used by the healthcare, biotech, medical device and electronics industries.

At the end of 2018, E. Kahn bought what was then a vacant 55,000-square-foot office and lab building on nearly 17 acres off Creamery Way from Sabic Innovative Plastics, a chemical and plastics company that is part of Saudi Arabia-based Aramco. The company had closed its Exton office in 2017. It also ceased manufacturing operations at a 110,000-square-foot facility at 251 S. Bailey Road in Thorndale in March 2016. Kahn had also purchased the Bailey Road building from Sabic when it shuttered that factory.

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Wednesday, June 17, 2020

The Office Hub and Spoke Model is Coming to Office Space

by Les Shaver Globest.com
The office hub-and-spoke concept is nothing new. Companies have used it for years.

Their headquarters serves as the hub of the business, while the spokes are a geographically distributed network of offices, usually based on talent and client needs. The headquarters is generally in a core location accessible to public transportation, and it acts as the cultural center of the business.
Like many things in commercial real estate, COVID-19 has acted as an accelerant for the hub-and-spoke model.

“It’s inevitable that COVID has forced companies to rethink their space and logistical needs, and this model is evolving,” says Bryan Murphy, CEO of Breather. “With more and more companies becoming comfortable with their employees working from home and as a result, extending their work from home policies comes a change for the future of work.”

As companies have grown more accustomed to their employees working remotely, Murphy says they’re now looking to downsize their headquarters.

“HQ will still be the cultural hub but may have only 30% of employees working from there on a day-to-day basis,” Murphy says. “Ultimately, executives want more flexibility when it comes to real estate—both for their people and their leases. They’re looking to supplement with flexible spaces that serve the needs of their employees.” 

“Larger spaces typically work better for hubs as they’re equipped with the tools, features and layouts needed for acting as a business’s core location,” Murphy says. “Typically, a hub space would include multiple breakout rooms, different areas of soft-seating and areas for large team meetings.”
Since the hubs serve as a company’s headquarters, they often have a larger employee count. “When employees from out of town (or who typically work in a spoke) meet as an entire team, they will usually meet in the hub,” Murphy says. “Larger spaces that are built and designed specifically for fuller teams can fulfill the needs and purpose of a hub.”

Spokes are traditionally smaller locations that are often designed as an open space to accommodate the needs of a single team or company function. They can be appropriate for sales, marketing, call centers and special projects.

“These spokes will range from drop-in spaces located closer to their homes to reduce commuting time, to spaces where they can drop in for some quiet time, to spaces built for collaboration where teams can come together to ideate and plan,” Murphy says.

The implications of more companies adopting the hub-and-spoke model could be huge for office landlords. “This will impact landlords because the hub and spoke model means that tenants don’t have a need for a massive HQ,” Murphy says. “We expect to see tenants move away from 10-year leases, and instead add spokes on flexible terms based on the current needs of the business.”

The move away from long-term leases will force landlords to offer more flexibility. “People want space solutions that provide flexibility and options,” Murphy says. “Companies that are able to provide flexible space and, more specifically, private space options, in particular, will continue to see upticks and grow in popularity as people seek alternatives to traditional office space.”

JV Breaks Ground on Philadelphia Area Multifamily

By Ingrid Tunberg Globest.com
The joint-venture partnership of GMH Capital Partners LP and AEW Capital Management LP has broken ground on its four-story, multifamily development in Malvern, PA.

The 225-unit community, The Pendleton at Malvern, is slated to open in summer 2021.
The Pendleton at Malvern will offer a variety of floorplans to future tenants, including studios, one-bedroom units and two-bedroom units. Each residence will feature stainless steel appliances and state-of-the-art interiors, and certain residences will offer private balconies.

The property’s outdoor amenities comprise a resort-style pool, entertainment areas, a beer garden and a bocce court within a private, half-acre courtyard. The community will additionally feature a fitness center, motion studio, e-lounge, conference rooms, concierge, a dog-wash area, a gaming room and a kitchen/bar.

Situated on Lancaster Avenue, the property will be offer access to Philadelphia through its close proximity to major roadways, such as Route 202, Interstate 76, The Pennsylvania Turnpike and Route 29. The community will also be located near The Great Valley Corporate Center, which hosts companies such as Microsoft, Siemens, IKON and Johnson & Johnson. 

“We believe The Pendleton at Malvern’s central location in a live, work, play environment fits right into the township’s comprehensive plan to promote Route 30 as a corridor with a diverse mix of land uses and improved multimodal transportation options,” said Gary Holloway Jr., GMH Capital Partners president. “We are excited to work alongside AEW in establishing yet another exceptional apartment community right in our backyard, and we look forward to welcoming new residents upon completion.”

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Thursday, June 11, 2020

Red Solo Cup Manufacturer to Consolidate Footprint, Open New Facility in Delaware

By Cara Smith-Tenta 
CoStar News

The company that manufacturers red Solo cups plans to fill up some industrial space in Delaware.

Dart Container Corp, based in Mason, Michigan, agreed to occupy a 1 million-square-foot distribution center in New Castle, Delaware. The distribution facility is expected to open later this year and employ between 60 and 70 workers.

Dart’s new Delaware facility is reportedly planned to open in Delaware City Logistics Park, a 190-acre business park that is being developed by Northpoint Development, a commercial developer based in Riverside, Missouri, according to media reports. Dart declined to comment on the location of its new Delaware facility, and Northpoint Development declined to comment on Dart’s behalf.

The new facility is meant to replace two of Dart’s distribution centers in Maryland, one in Havre de Grace, and another in Hampstead, the spokesman said. Collectively, those facilities employ more than 80 workers, and around 15% of those employees are expected to be transferred to the Delaware distribution center.

Dart’s 607,987-square-foot facility in Havre de Grace sits at 1900 Clark Road, while its 1.03 million-square-foot facility in Hampstead sits at 630 Hanover Pike, according to CoStar data. Dart has occupied its Hampstead facility since 2001.

Dart operates a facility in Federalsburg, Maryland, at 1000 Industrial Park Road that employs 650 people. The spokesman said that facility will remain open.

New Castle sits right outside Wilmington and around 40 miles outside of Philadelphia, within the city’s metropolitan area. The narrative surrounding Philly’s industrial market, even throughout the coronavirus pandemic, remains “bullet-proof,” Adrian Ponsen, director of market analytics with CoStar in Philadelphia, writes in his most recent report on the city’s industrial market. The city’s industrial stock is just 5.1% vacant, compared to the national average of 5.5%, according to CoStar data, and Philadelphia is a strong East Coast distribution market that has attracted major retailers, including Amazon, Target and Walmart.

Though, there is something that could give investors in the city’s industrial market pause: More than 3 million square feet of distribution space in Philadelphia are occupied by troubled brick-and-mortar retailers, including Kmart, Sears and Office Depot, according to CoStar research, and the city is running the risk of having an overbuilt industrial market in the months and years to come.

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Tuesday, June 9, 2020

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Buccini/Pollin Group Buys $80M deal to buy Baltimore hotel

By Amanda Yeager  – Reporter, Baltimore Business Journal

A local real estate firm has put out a call for investors to join in on a distressed acquisition of the Renaissance Baltimore Harborplace hotel.

The Buccini/Pollin Group is preparing to close on a sale of the 622-room hotel at the end of June. The expected acquisition price is $80 million, which breaks down to nearly $129,000 per room, according to a listing on the investment platform CrowdStreet.

The firm, which has offices in Conshohocken and Wilmington, Delaware, is soliciting investments of up to $20 million in Class A membership interests, per the listing, which says offers are due by June 19. The minimum investment is $40,000.

The hotel, located at 202 E. Pratt St. in the heart of downtown Baltimore, last sold for $157 million in 2005. Current owner Sunstone Hotel Investors has spent nearly $40 million on the property over the past decade, the listing says, including a $24.1 million overhaul of the hotel's guest rooms, bathrooms and suites completed last year.

After the acquisition, the Renaissance Harborplace will become a franchise under the Renaissance brand and will be managed by the PM Hotel Group. The Buccini/Pollin Group, which will co-invest $7.1 million into the purchase, plans to sell the property after five years for $144.6 million.

The Renaissance Harborplace is among the Baltimore hotels that are accepting guests at a time when travel has suffered a massive blow due to the novel coronavirus outbreak. The occupancy rate for hotels in the city's central business district was 19.9% for the week of May 24-30, according to hotel data company STR.

Friday, June 5, 2020

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Century Therapeutics lease 32,500 SF in Philadelphia

By Ingrid Tunberg Globest.com

The lease encompasses 32,500 square feet of new office and lab space within in One uCity Square, a 400,000-square-foot mixed-use community, comprising class-A office, lab and retail space. Located in Philadelphia’s University City neighborhood, the mixed-use community is a joint-venture between University City Science Center, Wexford Science & Technology LLC and Ventas Inc.
The development recently broke ground and is expected to deliver in early 2022. Century Therapeutics will occupy the space within the city’s growing life science ecosystem, upon completion.

Pennsylvania’s life sciences venture capital funding has totaled more than $392 million year-to-date, compared to $86.7 million within the first half of 2019; representing a more than 350% increase. The funding in Pennsylvania ranges from $250,000 to $200 million, with firms growing and in need of various-sized space of all sizes.

Century Therapeutics launched in 2019 to focus on developing cell therapies.

Thursday, June 4, 2020

Scout Capital Partners Finalizes Terms to Buy Cold Storage Logistics Center Underway Near Philadelphia

Scout Capital Partners, a Florida-based real estate investment and development firm, has recently entered into a contract to purchase Scout Cold Logistics Center - South Jersey upon completion.

The 332,000-square-foot facility located just 18 miles outside central Philadelphia will serve tenants in the perishables industry including online retailers, supermarkets and pharmaceutical companies.

Pent-up demand for cold storage facilities has been accelerated by the coronavirus pandemic and is expected to intensify due to the continued growth of online grocery shopping, according to a press release.

The building at 450 Swedesboro Ave. in East Greenwich Township has 97,000 square feet already pre-leased to a perishable logistics company.

“Our leasing strategy for Scout Cold Logistics Center - South Jersey will target local, regional and national perishable operators seeking flexible, climate-controlled space who want to be within a three-hour drive of more than 40 million consumers."

Scout was founded by Vincent Signorello and its industrial investment and development platform is led by Dan Marcus, a partner at the firm and longtime associate of Signorello.

“America’s supply of cold storage facilities is wholly inadequate to match the increasing demands of food distribution and online shopping, not to mention the need for storing highly-perishable pharmaceuticals and medical supplies,” Signorello said. “Scout Cold Logistics Center, in the heart of the Eastern Seaboard, will be a core asset within our national network of climate-controlled facilities.”

The facility, which will sport 80 loading docks and a 36-foot clear height, is slated to be completed this summer.

Tuesday, June 2, 2020

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Warehouse Leasing Picks Up as Consumers and Businesses Begin Spending Again

Industrial leasing is increasing as more states gradually reopen their economies from coronavirus-related closings and businesses get more comfortable committing to warehouse space.

Demand began slowing in mid-March, and CoStar logged some of the lowest levels of activity in history in April as skyrocketing numbers of Americans filed unemployment insurance claims, which totaled more than 40 million as of May 28. But consumers’ attitudes toward spending, which indirectly influence demand for logistics and distribution buildings, have begun to improve, CoStar managing director and senior economist Abby Corbett said in a new state of the market video.

Warehouse lease deals have gradually increased since the middle of April, and during the week that concluded May 23, more than 500 new leases were signed totaling nearly 13 million square feet, which is in line with the average weekly dealmaking collected throughout 2019, Corbett said.

Once again, e-commerce, medical, pharmaceutical and logistics operators such BMS Logistics led the charge. Amazon, among the most prolific users of industrial space before and during the coronavirus pandemic, signed a massive deal for 2.85 million square feet in Erlanger, Kentucky, near Cincinnati-Northern Kentucky International Airport.

Atlanta-based furniture store chain Haverty Furniture Companies Inc. raised $70 million by selling warehouses in Florida, Texas and Virginia. Havertys agreed to remain the tenant, and CoStar expects to see more sale-leaseback transactions as distressed retailers such as department store chain J.C. Penney look for ways to increase liquidity and pay their bills, Corbett said.

Meanwhile, CoStar has detected a major shift in construction from industrial projects built for specific tenants to warehouses built on speculation without signed tenants, Corbett said. Some industrial hubs such as Philadelphia and Pennsylvania's Lehigh Valley are seeing some problems with leasing up of new buildings.

"Tenants looking for modern space have far more options than they did just two or three years ago," Corbett said. "Over 600,000 square feet of space with 30-foot clear heights is now available, compared to just 400,000 square feet in 2018."