By Charlie Dettbarn and Rachel Whaley CoStar Research
Velocity Venture Partners, a value-add industrial investment firm formed in 2016, has bolstered its Philadelphia-area portfolio with its latest purchase, a 677,000-square-foot distribution facility fronting I-476 in Eastern Montgomery County, Pennsylvania.
The real estate investment firm acquired 2750 Morris Road in Lansdale from a joint venture between Advance Realty Investors and The Davis Cos. The building sold for $33 million, or about $44 per square foot, according to CoStar data.
The Flynn Co. represented the buyer in the acquisition of the property and has been retained by Velocity to handle leasing and property management. Cushman & Wakefield represented the seller.
The distribution facility, which Velocity plans to renovate and rebrand as Velocity Park, was originally built in 1989 by Ford Motor Co. and housed the auto maker's electronics division until 2010. The building was about 60% leased at the time of the sale, providing a partially occupied property with leasing upside, according to Velocity. About 230,000 square feet of warehouse space and 50,000 square feet of office space is available.
Velocity's latest purchase continues its rapid growth throughout Pennsylvania and New Jersey, specifically Eastern Montgomery County. With its latest acquisition, Velocity's portfolio now totals about 3 million square feet.
Industrial remains as the Philadelphia region's healthiest commercial property type six months into the coronavirus pandemic, CoStar director of market analytics Adrian Ponsen notes in a recent market report. The industrial market still faces challenges but retailers' ongoing shift to e-commerce sales and faster delivery times has continued to drive industrial leasing as tenants store more of their inventory in local logistics centers as close to their customers as they can, Ponsen wrote.
Velocity said it has experienced "overwhelming success" with its last-mile industrial properties in Pennsylvania and New Jersey, and the company is confident that the property will "absorb tenants benefiting from the surge in e-commerce growth," Zach Moore, a founding partner at Velocity, said in a statement.
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