Friday, August 28, 2020
Thursday, August 27, 2020
Protecs Innovation Center in Blue Bell Lands Two Life Sciences Tenants
Protecs Innovation Center, a two-story lab and life sciences building in Blue Bell, Pennsylvania, has picked up two tenants.
KorGene, which develops targeted and molecular diagnostics, is leasing 8,259 square feet at the building, while ThirdLaw Technologies, which specializes in synthetic and computational chemistry, is taking 4,808 square feet at the 50,000-square-foot building at 512 Township Line Road.
Christopher R. DiPaolo, principal of 4 Valley Square Group, is also the president and founder of Protecs LLC, a national design/build firm and construction management firm focused on providing regulated high-tech industries with professional services for research and development and manufacturing operations.
"The suburban Philadelphia life sciences real estate market has remained very strong during the COVID-19 pandemic. These two tenants were attracted to the existing lab infrastructure and required quick occupancy of the space, a trend we are seeing more of during the pandemic."
The landlord is planning a capital improvement project for the Blue Bell building, which includes modernizing common areas and updating its facade and hardscaping. Renovations are set to be completed by the end of the quarter. It is also planning to building speculative lab space at the Protects Innovation Center in Blue Bell to accommodate fast-moving, turnkey requirements.
"The limited supply of lab space in the region, coupled with the increasing demand from life sciences occupiers bodes well for this asset going forward."
In addition to the Blue Bell location, Protecs has another Innovation Center in King of Prussia and two others in Plymouth Meeting that total 120,000 square feet and contain 16 technology and life sciences companies.
Canadian Joint Venture Pays $39 Million for South Jersey Industrial Site
By Rachel Whaley CoStar Research
Toronto-based WPT Industrial Real Estate Investment Trust and Investment Management Corporation of Ontario purchased an industrial land parcel in Mansfield, New Jersey, for $39 million.
The 61-acre site is located off Route 206 and is about two miles from the New Jersey Turnpike and Interstate 295.
The joint venture plans to develop about 772,000 square feet of modern distribution and logistics space at the site. A timeline for the development project has not yet been disclosed.
Tuesday, August 25, 2020
ShipHero Subleases 150K SQFT Lehigh Valley Warehouse
ShipHero has subleased a warehouse facility at 6736 Tilghman St. in Allentown, Pennsylvania.
The U.S. multinational e-commerce logistics company is taking the entire 150,0000-square-foot industrial building called Iron Run Distribution Center II. It is subleasing the space from True Value.
ShipHero will use the Lehigh Valley warehouse as a fulfillment center. It will be the company's ninth location in the country.
The 150,000-square-foot building was developed in 1975. Prologis acquired the property in January as part of the Black Creek Group portfolio deal.
Monday, August 24, 2020
Thursday, August 20, 2020
Wednesday, August 19, 2020
Pandemic May Deliver Final Blow to Struggling Malls- Including Montgomery Mall North Wales, PA
by Cheryl Miller Globest.com
The impacts of COVID-19 stay-at-home orders and business restrictions may seal the fate of regional malls that were already struggling before the pandemic, a report by DBRS Morningstar concluded.
The credit rating agency’s CMBS Weekly Chronicle notes that CBL Properties recently announced in its second-quarter financials that it is preparing to turn over to lenders three properties with secure commercial mortgage-backed securities loans: Burnsville Center in Burnsville, Minn.; Eastgate Mall in Cincinnati, Ohio; and Hickory Point Mall in Forsyth, Ill.
Those developments are not surprising given historical performance trends for those malls, the report concluded.
“The effects of the pandemic have exacerbated the existing stresses for underperforming regional mall properties, further diminishing the prospects for a turnaround for weaker performers in CMBS,” the report said. “As such, the likelihood of default and losses to the respective trusts are generally higher, particularly for less well-capitalized owner/operators such as CBL, The Pyramid Companies (Pyramid), and Washington Prime Group (WPG).”
According to a DBRS platform, approximately 70 loans and loan pieces backed by approximately 50 regional malls have transferred to special servicing since the pandemic began.
“While some of those transfers appear to be performing loans in need of temporary relief, many are loans that showed significant performance declines before the onset of the pandemic,” the DBRS Morningstar report said.
The report highlighted a number of malls at risk of “respective borrowers turning over keys.”
The loan on Simon Property Group-owned Montgomery Mall in North Wales, Penn. transferred to special servicing in July, according to the report. The special servicer cited imminent default due to COVID-19 effects as the reason for the loan’s transfer.
Occupancy at the CBL Properties-operated Southpark Mall in Colonial Heights, Va. dropped to 64.1% in 2018 after the Sears store there closed. The loan on the property was transferred to special servicing in March and an application for pandemic-related relief was ultimately withdrawn, according to the report.
The loan on the Washington Prime Group-Operated Oak Court Mall in Memphis, Tenn. is coming due in April 2021. “Given the weaker financial position of the loan sponsor, WPG, and the performance declines from issuance, we believe it will be significant[ly] difficult to obtain a replacement loan,” the report said. The loan transferred to special servicing in May and was more than 90 days delinquent as of July. The leases for 34 tenants expire in either 2020 or 2021.
Tuesday, August 18, 2020
Modular Rentals in Philadelphia Draw Strong Interest
by John Dougherty Costar
A pre-built modular apartment building in Philadelphia’s University City neighborhood has sold for $36 million.
The property at 4125 Chestnut St., known as LVL 4125, was acquired by a New York City-based family investment office. The seller was CRP Builders, also of New York.
The six-story, 141-unit building opened last year and is within walking distance of Drexel University, the University of Pennsylvania and that institution’s medical school and medical center. The fully leased complex was developed by Philadelphia-based Alterra Property Group in partnership with the Carlyle Group institutional investment firm.
Although it’s not dedicated student housing, the property is home to many graduate students, faculty and staff of the nearby schools.
Modular apartments — units that are prefabricated off site and then assembled at the new location — are a small segment of the overall multifamily market.
But they do provide some big advantages: The units assemble quickly, and developers do not have to rely on the vagaries of the local labor market during development.
Sellers conducted 40 tours despite the coronavirus pandemic and received 15 offers.
The property has central air-conditioning, granite countertops, washers and dryers in the units, a fitness center and a roof deck.
Thursday, August 13, 2020
Wednesday, August 12, 2020
Top Industrial Leases Recognized for Philadelphia Area
Prominent industrial leases signed by Target, Geodis and FedEx negotiated by top dealmakers from Cushman & Wakefield of New Jersey, JLL and ProVenture are among the second quarter industrial leases recognized by CoStar.
As big ticket items involving sizable investments, commercial property transactions often have a wider impact within the community.
TOP LEASE: 2858 US Route 322, Logan Township, NJ
Space Leased: 1,105,000 SF
Deal Type: New Lease
Sign Date: April 23, 2020
Size: 1,105,000 SF
Tenant: Target
Deal Commentary: Target signed the Philadelphia market's largest industrial deal of the second quarter when it agreed to lease a 1.1 million-square-foot distribution center currently underway in the new Logan North Industrial Park. Expected to create approximately 1,300 jobs, the facility will serve as a flow center to fulfill online orders and restock retail stores. Construction of the new warehouse is currently scheduled for completion in summer 2021.
TOP LEASE: 951 Willowbrook Road, Northampton, PA
Space Leased: 1,031,524 SF
Deal Type: New Lease
Sign Date: April 20, 2020
Size: 1,031,524 SF
Tenant: Geodis
Deal Commentary: Transport and logistics leader Geodis is slated to expand its U.S. footprint by taking just over 1 million square feet of distribution space at Rockefeller Group Logistics Park before the end of the year. The property, which offers immediate adjacency to the largest FedEx ground hub in the country and is less than two miles from Lehigh Valley International Airport, is owned by New York City-based firm Rockefeller Group.
TOP LEASE: 2400 South Weccacoe Ave., Philadelphia, PA
Space Leased: 283,500 SF
Deal Type: New Lease
Sign Date: June 8, 2020
Size: 283,500 SF
Tenant: Amazon
Deal Commentary: Amazon has leased the SoPhi Logistics Center and will begin to occupy the property in December of this year. The site will serve as a last-mile distribution center for the retail giant.
TOP LEASE: 180 Kost Road, Carlisle, PA
Space Leased: 487,080 SF
Deal Type: New Lease
Sign Date: April 4, 2020
Size: 487,080 SF
Tenant: Georgia Pacific
Deal Commentary: Georgia Pacific, maker of tissue, pulp, packaging, building products and related chemicals, expanded in the Philadelphia market with a lease to take all 487,080 square feet at a new warehouse owned by New York Life Real Estate Investors.
TOP LEASE: 2834 Schoeneck Road, Macungie, PA
Space Leased: 270,000 SF
Deal Type: New Lease
Sign Date: May 7, 2020
Size: 270,000 SF
Tenant: Silgan Plastics
Deal Commentary: The Lehigh Valley Crossings industrial park has a new tenant after Silgan Plastics, a packaging company serving the plastic bottling industry, leased the distribution center at 2834 Schoeneck Road in Macungie, Pennsylvania. The building has been empty since The Lehigh Group vacated in late 2018.
Boston Company Buys Southern New Jersey Warehouse for $23.2 Million
by Linda Moss Costar
Boston-based High Street Logistics Properties has purchased a 432,000-square-foot industrial facility in Southern New Jersey for $23.2 million.
Vineland Construction sold the property at 3100 N. Mill Road in Vineland.
Built in 1989 and expanded in 1997, the warehouse is currently 100% occupied by Ardagh Glass, a provider of sustainable packing products. The tenant’s customers include Coca-Cola, Heineken, Nestlé and Bacardi, among others. Earlier this year, Ardagh Glass committed to a 10-year lease extension through early 2030.
The building has clear ceiling heights of 28 to 34.5 feet, a cross-docked configuration, 40-by-50 column spacing, 24 dock doors, 18 trailer parking spots and 54 car parking spaces.
The warehouse is part of the Vineland Industrial Park, which includes 43 buildings totaling over 2.7 million square feet. The industrial park is located directly off Route 55.
“Although Vineland is a relatively small industrial market, it continues to be a strong submarket with minimal availabilities, great labor, low direct vacancy, good build-to-suit activity and Class A rents north of $5 per square foot."
Large Office Portfolio Trades in Lehigh Valley
By Ben Atwood Costar Market Analysts
Lehigh Valley’s office investment market starts the third quarter surprisingly strong thanks to a single purchase in late July.
The deal contained nearly half a million square feet in 13 offices, and included assets in neighboring Pittston and Phillipsburg.
Hammes Properties spent just over $137 million on the deal. The firm specializes in healthcare related real estate and owns properties across the country.
The assets were acquired from the former CEO of Coordinated Health, Emil DiIorio. Coordinated Health was acquired by the Lehigh Valley Health Network in late 2019, and they have taken over much of the space that Coordinated Health had leased within these properties. A mixture of other tenants in the medical field take up the remaining space in the properties, which are largely fully occupied and range in size from 10,000 to 100,000 square feet.
The financial issues of Coordinated Health do somewhat obscure the insight this sale can offer, but even as a distressed sale, it is interesting to dissect. The coronavirus has upended the commercial real estate world and investors are, for the large part, holding on to their cash. The office sector has been profoundly impacted by the virus and the general consensus is that total office demand will be reduced in the near future as remote working becomes more and more viable.
The properties sold for close to $300 per square foot, well above the market average. But Lehigh office is a relatively slow investment market. That average can be somewhat skewed by a lack of deals and this is one of the larger sales in recent years. Out-of-state money coming into the market is not unheard of, but it is uncommon.
That the properties catered to medical tenants was almost certainly a draw and many of the properties were well-positioned. The largest cluster of properties was off North Cedar Crest Boulevard, just outside the city of Allentown and well-positioned near large retail and residential areas.
But even healthcare tenants are subject to virus disruption and it could also be that Lehigh Valley itself is a draw. The market is one of the fastest growing in Pennsylvania and is well-positioned to endure the coronavirus and perhaps come out on top.
Don Cunningham, president and CEO of the Lehigh Valley Economic Development group, believes the deal is a source of optimism for the market.
"We are fortunate that even during these challenging times commercial and industrial properties in the Lehigh Valley do not stay dormant for too long, particularly in the health care sector," Cunningham said. "The Hammes purchase of the Coordinated Health properties is an indicator of the strong health care and medical office space market in the region."
Tuesday, August 11, 2020
Top Philadelphia Commercial Real Estate Leases and Sales
Top Property Sales Recognized for Philadelphia
TOP SALE: 1901 Market St., Philadelphia, PA
Sale Price: $360,000,000
Sale Date: June 25, 2020
Size: 801,000 SF
Buyer: Independence Health Group, Philadelphia, PA
Seller: Piedmont Office Realty Trust, Atlanta, GA
Deal Commentary: Piedmont Office Realty Trust exited the Philadelphia market with the $360 million sale of 1901 Market St. as the company looks to focus on the Sun Belt region. Independence Health Group seized the opportunity to reacquire the 45-story tower that houses the headquarters of its Philadelphia-based subsidiary, Independence Blue Cross.
4200 Braden Blvd. E, Easton, PA
Sale Price: $62,500,000
Sale Date: June 4, 2020
Size: 475,800 SF
Buyer: Black Creek Group, Denver, CO
Seller: Dermody Properties, Reno, NV, and PCCP, Los Angeles, CA
Deal Commentary: Black Creek Group finalized a deal in early June to acquire the Easton warehouse of e-commerce services provider, Radial. Dermody Properties developed the 475,800-square-foot property, named LogistiCenter at 33, in 2016, and sold the complex along with its partner, real estate finance and investment management firm PCCP, for $62.5 million. Radial has fully leased the property since late 2019.
TOP SALE: Portfolio of 7 Properties
Sale Price: $42,925,000*
Sale Date: April 10, 2020
Size: 107,168 SF
Buyer: Endurance Real Estate Group, Radnor, PA, and PCCP, Los Angeles, CA
Seller: Novaya Real Estate Ventures, Boston, MA
Deal Commentary: The Southern New Jersey Core Infill Portfolio attracted its new owner because of its desirable location with historically high occupancy and its rapid rent growth. The portfolio is also consistent with the venture's investment strategy. *Part of a portfolio sale
TOP SALE: Portfolio of 3 Properties
Sale Price: $27,025,000
Sale Date: April 24, 2020
Size: 380,274 SF
Buyer: Brennan Investment Group, Rosemont, IL
Seller: The Magellan Group, Los Angeles, CA, and Drake Real Estate Partners, New York, NY
Deal Commentary: Betting on the continued resilience of the industrial sector and strength of the Lehigh Valley industrial market, new owner Brennan Investment Group acquired a three-building, fully leased portfolio in Lehigh Valley Industrial Park II to increase its Northeast holdings to nearly five million square feet.
TOP SALE: 405 North King St., Wilmington, DE
Sale Price: Not disclosed
Sale Date: May 8, 2020
Size: 155,000 SF
Buyer: Amtrak, Philadelphia, PA
Seller: The Commonwealth Group, Wilmington, DE
Deal Commentary: Amtrak reached a deal in May to acquire the Renaissance Centre in Wilmington, Delaware, where the railroad service had occupied space as a tenant. With its lease set to expire, Amtrak elected to buy the building outright and expand its footprint to 79,465 square feet. This was a strategic move by Amtrak to reduce costs by having employees work out of owned property.
TOP SALE: 518 Township Line Road, Blue Bell, PA
Sale Price: $24,850,000
Sale Date: April 2, 2020
Size: 123,087 SF
Buyer: AFA Real Estate Partners, Yardley, PA
Seller: Kairos Real Estate Partners, Blue Bell, PA, and Artemis Real Estate Partners, Chevy Chase, MD
Deal Commentary: AFA Real Estate Partners added Blue Bell Plaza to its portfolio. This investment was attractive due to the updated building amenities and quality of tenants including accounting firm RSM, developer Skanska USA and Blue Bell Surgery Center.
TOP SALE: 1240 McKee Road, Dover, DE
Sale Price: $21,347,000
Sale Date: June 3, 2020
Size: 42,140 SF
Buyer: Anchor Health Properties, Charlottesville, VA, and Harrison Street Capital, Chicago, IL
Seller: MedCore Partners, Dallas, TX.
Deal Commentary: MedCore Partners sold the newly completed and fully leased Post Acute Medical Rehabilitation Center in Dover, Delaware, to a joint venture between Anchor Health Properties and Harrison Street Capital.
TOP SALE: 824 North Market St., Wilmington, DE
Sale Price: $16,550,000
Sale Date: April 8, 2020
Size: 207,005 SF
Buyer: Chopp Holdings, Lakewood, NJ
Seller: Ellington Management Group, Old Greenwich, CT
Deal Commentary: Chopp Holdings scored a value-add investment with its $16.55 million purchase of 824 N. Market St. in downtown Wilmington. The 10-story property is 67% leased with the U.S. Bankruptcy Court occupying more than 65,000 square feet.
TOP SALE: Portfolio of 3 Properties
Sale Price: Not disclosed
Sale Date: June 12, 2020
Size: 78,194 SF
Buyer: The Leser Group, Brooklyn, NY
Seller: Rockland Capital, Philadelphia, PA
Deal Commentary: Rockland Capital sold a portfolio of office and retail properties in Philadephia, totaling 78,194 square feet, to Brooklyn-based investor The Leser Group in June. The new owner has real estate development and property management experience and focuses on commercial and industrial properties.
TOP SALE: 1 Storm St., Stroudsburg, PA
Sale Price: $15,180,000
Sale Date: June 26, 2020
Size: 37,976 SF
Buyer: IRA Capital, Irvine, CA
Seller: Doctors Investment Group, Stroudsburg, PA
Deal Commentary: IRA Capital bought the Pocono Ambulatory Surgical Center in Stroudsburg because it fits the company's investment criteria, which is primarily focused on healthcare real estate. This acquisition further expands the equity firm's national footprint, which currently spans across 25 states and exceeds 6 million square feet of property.
Top Retail Leases Recognized for Philadelphia
TOP LEASE: 104-108 Bartlett Ave., Exton, PA
Space Leased: 37,275 SF
Deal Type: New Lease
Sign Date: April 22, 2020
Size: 79,601 SF
Tenant: Lidl
Deal Commentary: German discount supermarket chain Lidl is continuing its U.S. expansion spree with the signing of a 37,275-square-foot deal in Exton, Pennsylvania. The grocer is filling a void at Main Street at Exton that was previously left when Toys R Us went bankrupt a few years prior.
TOP LEASE: 871 East Lancaster Ave., Downingtown, PA
Space Leased: 37,126 SF
Deal Type: New Lease
Sign Date: June 2, 2020
Size: 140,858 SF
Tenant: The Edge Fitness Clubs
Deal Commentary: Continuing its East Coast and Midwest expansion plan, The Edge Fitness Clubs has signed its sixth deal in Pennsylvania with a 37,126-square-foot deal at Ashbridge Square.
TOP LEASE: 1301-1325 Churchmans Road, Newark, DE
Space Leased: 22,000 SF
Deal Type: New Lease
Sign Date: June 15, 2020
Size: 256,119 SF
Tenant: Ross Dress for Less
Deal Commentary: Opening its third location near Christiana Hospital, Ross Dress for Less signed a deal to take over space previously left dark by Babies R Us in late 2018. Ross will join center anchor Home Depot and other stores and restaurants.
TOP LEASE: 770 State Road, Lehighton, PA
Space Leased: 25,700 SF
Deal Type: New Lease
Sign Date: June 10, 2020
Size: 42,502 SF
Tenant: Harley-Davidson
Deal Commentary: Harley-Davidson leased back space at 770 State Road until its new location at 2800 Eberhart Road in Whitehall Township opens in fall 2020.
TOP LEASE: 180 Susquehanna Blvd., Hazleton, PA
Space Leased: 24,072 SF
Deal Type: New Lease
Sign Date: June 12, 2020
Size: 32,968 SF
Tenant: Geisinger Health Systems
Deal Commentary: Geisinger Health Systems is expanding its 65 Forward program with a new health center located in a former Staples store in Hazleton. Forward 65 is a holistic approach to senior primary care created exclusively for people 65 and older. Geisinger is also building a new 65 Forward center in downtown Wilkes-Barre.
TOP LEASE: 832-880 Plaza Blvd., Lancaster, PA
Space Leased: 14,400 SF
Deal Type: New Lease
Sign Date: April 15, 2020
Size: 143,275 SF
Tenant: Just Furniture
Deal Commentary: Just Furniture is opening a new 14,400-square-foot location at Parkview Plaza where the retailer will offer affordable home furnishings to residents in the Lancaster area.
TOP LEASE: 3285 Black Gap Road, Chambersburg, PA
Space Leased: 31,080 SF
Deal Type: New Lease
Sign Date: April 4, 2020
Size: 31,080 SF
Tenant: Sportsman's Warehouse
Deal Commentary: Sportsman’s Warehouse took over the 31,080-square-foot building at 3285 Black Gap Road. The property had been vacant since late 2019 when Gander Mountain moved out.
TOP LEASE: 7700-7780 Crittenden St., Philadelphia, PA
Space Leased: 6,510 SF
Deal Type: New Lease
Sign Date: June 11, 2020
Size: 47,739 SF
Tenant: Anytime Fitness
Deal Commentary: Anytime Fitness renewed its lease at Market Square in Chestnut Hill. The fitness chain, with over 3,000 locations, has occupied space at this center since 2014.
TOP LEASE: 125-131 Shoemaker Road, Pottstown, PA
Space Leased: 12,280 SF
Deal Type: New Lease
Sign Date: June 26, 2020
Size: 48,239 SF
Tenant: Harbor Freight
Deal Commentary: Harbor Freight, a provider of quality tools for over 40 years, will join Ollie’s Bargain Outlet at West Pottstown Shopping Plaza after signing a 12,280-square-foot lease. With the lease, the retailer adds another location to its existing 1,000-plus stores.
TOP LEASE: 4321-4403 Swamp Road, Doylestown, PA
Space Leased: 7,200 SF
Deal Type: New Lease
Sign Date: June 29, 2020
Size: 152,468 SF
Tenant: FiveBelow
Deal Commentary: Five Below signed a lease for 7,200 square feet to open a new location at Cross Keys Place. The value-driven retailer, known for offering a variety of products at a cost of $5 or less, will add another location to its existing 950-plus stores across 38 states.
Monday, August 10, 2020
Wednesday, August 5, 2020
Will Downtown Office Towers Continue to Command Top Rents?
Tuesday, August 4, 2020
More Renters Are 'Ghosting' Landlords, Apartment REIT Complains
Monday, August 3, 2020
Apartment Construction Starts Slowed Nationwide, but Some Southern Cities Bucked the Trend
