Monday, November 30, 2020
Burlington to Shrink Store Footprints, But Still Expand Its Brick-and-Mortar Network
By Linda Moss CoStar News
Unlike many retailers, Burlington Stores is still adding brick-and-mortar locations in the pandemic. But it will be doing so while reducing the store footprints by more than half, to 25,000 square feet from 40,000.
Michael O’Sullivan, CEO of the Burlington, New Jersey-based off-price chain, on Tuesday said the company is developing a national prototype for a “smaller box size” for its stores, which “are bigger and less productive than our peers.”
The goal of the retailer, which has roughly 770 stores, is to reduce real estate occupancy costs and to improve store-level efficiency, he said in a third-quarter earnings call with Wall Street analysts.
“Our real estate and store operations teams have done a lot of work in the past year on a 25,000-square-foot store prototype,” O’Sullivan said. “We feel good about the merchandising and operational plan that we have developed for this smaller prototype. We expect the economics of this format to be very favorable and we anticipate that it will become a central part of our new store opening and relocation programs, especially from 2022 onwards.”
Burlington raised eyebrows in March when it announced it was pulling the plug on its e-commerce business to focus on increasing its store fleet. It continues to open brick-and-mortar sites, even as this year has seen the demise of a number of retail chains and the downsizing and bankruptcies of others.
“Here at Burlington we have ambitious growth plans over the next several years,” O’Sullivan said. “We believe, as I described in my prepared remarks, that we have an opportunity to take significant market share in the years ahead.”
Store Portfolio Changes
As “the smallest, least-developed and least profitable of the major off-price retailers,” Burlington is in a position to benefit from the national retail trends that have been exacerbated by the COVID-19 outbreak, according to O’Sullivan, who joined the New Jersey company from one of its much bigger rivals, Ross Stores. Consumer desire for value has risen, as has e-commerce at the expense of full-price bricks-and-mortar retailers, according to the CEO.
Value-oriented shoppers will migrate to off-price retail, O’Sullivan said.
“This is consistent with what has actually been happening over the last several years," he said. "E-commerce has been growing rapidly, and bricks-and-mortar off-price retail has been growing in parallel. In the category that where compete, and the low-price points that we offer, e-commerce is much less effective or competitive in meeting the needs of value-oriented shoppers. As the [full-price] store closings that I described play out, there will be an opportunity for bricks-and-mortar, off-price retail to gain significant share.”
During the third quarter Burlington opened 30 new stores, bringing its total store fleet to 769, according to Chief Financial Officer John Crimmins.
“In the fourth quarter, we do not expect to open any new stores but do expect to close eight stores, resulting in an expected fiscal year-end store count of 761 stores,” he said.
In its statement, Burlington reported it will have a total of 34 net new stores in fiscal 2020.
The retailer plans to open 18 new stores in fiscal 2021 whose debuts were shifted from fiscal 2020, according to Crimmins.
One of Burlington’s strategies has been to operate with leaner inventories, and as a result it’s been able to begin reducing its store footprints, Crimmins said.
“This year our average store size is just under 40,000 square feet,” he said.
The 25,000-square-foot prototype is likely to “be a central element” to the retailer’s new store and existing store-relocation plan, according to Crimmins.
Joint Venture Buys Former NE Philadelphia Sears in Redevelopment Play
By Ann Warren Harless CoStar Research
A joint venture between Abrams Realty and Development and Bock Development has purchased a former Sears store in Northeast Philadelphia and plans to redevelop it.
Abrams and Bock acquired the three-story, 237,151-square-foot retail property located in the Great Northeast Plaza from Rialto Capital Advisors for $28.75 million.
The Great Northeast Plaza Sears store closed in April 2018 when parent company Sears Holdings announced it was closing over 100 Sears and Kmart stores across the country.
Abrams and Bock plan to redevelop the former Sears store into a new retail center called the Court at Cottman, which is named after the store's address, 2201 Cottman Ave. Details regarding the redevelopment project, though, have not yet been disclosed.
"Our team has an exciting and creative game plan to bring this outstanding real estate back to life," Peter Abrams, owner of Abrams Realty and Development, said in a statement.
Monday, November 23, 2020
Friday, November 20, 2020
Target to Open New Store at Former Kmart Location in Somers Point, NJ
Target is set to open a new 101,000-square-foot store within the Somers Point Plaza shopping center in Somers Point, New Jersey.
The national retailer will be taking the former Kmart space within the South Jersey shopping center. The Kmart store closed last year when parent company Sears Holdings closed four additional stores across the Garden State.
Somers Point Plaza landlord Brahin Properties is planning to complete extensive renovations to the shopping center facade, parking lot and lighting in conjunction with the new Target store.
Somers Point Plaza totals 279,026 square feet and is located on a 35-acre site at 212 New Road. The shopping center includes over 25 stores, including ACME Markets, PetSmart, West Marine, Big Lots, Verizon Wireless and Chipotle Mexican Grill.
Thursday, November 19, 2020
Wednesday, November 18, 2020
Tuesday, November 17, 2020
More Positive Developments in Allentown’s Neighborhood Improvement Zone
It was a busy week for the commercial property market in downtown Allentown, Pennsylvania.
For those tracking the growth and development occurring within the unique tax-incentive program contained entirely within Pennsylvania’s third largest city, the past 10 days have offered plenty of reasons for optimism.
The biggest news is the Jaindl Group’s announcement that it will be proceeding with construction on a 125,000-square-foot Class A office on Allentown’s riverfront before the end of the year.
Last week, the local developer told the Neighborhood Improvement Zone authority it would soon break ground on the first project on its long-planned Riverfront development.
Jaindl, one of the region’s largest land owners, has long had big plans for the riverfront, but redevelopment proved trickier than anticipated. It has put more than $18 million into getting the infrastructure set in the 26-acre site, which sits alongside the Leigh River.
If Jaindl fully follows through with its current plans, it will put more than $425 million into the Waterfront development before it’s all said and done. That would bring 690,000 square feet of premium office space, 165,000 square feet of retail and more than 550 units of four-star multifamily to Allentown's 6th Ward.
Jaindl will have some help from the state of Pennsylvania. The entirety of the Waterfront is contained within Allentown's "Neighborhood Improvement Zone," which incentivizes developers to build within the city by offsetting the financial risk of doing so.
So far, only one group has taken advantage of this plan. City Center, another local developer, has put more than $700 million building modern offices, apartments and retail in the Hamilton District. These projects have been largely successful at lease-up, and the firm recently notched up another pair of wins.
In the past 10 days, the group has filled nearly 20,000 square feet at Five City Center, its newest four-star office. One of those firms to take space, Raymond James and Associates, consolidated three regional offices across the Lehigh Valley for city space.
Monday, November 16, 2020
Utopia Fulfillment Expands Lease at Pennsauken Logistics Center in S NJ
E-commerce company Utopia Fulfillment has expanded its footprint at the Pennsauken Logistics Center, taking an additional 103,275 square feet of industrial space at the South Jersey warehouse facility it began occupying just two months prior.
Utopia originally leased 120,000 square feet at the 355,000-square-foot industrial building after it was made available by Velocity Ventures following its purchase and subsequent renovation of the complex. With this expansion, Utopia will now occupy 223,275 square feet at Pennsauken Logistics Center.
Located at 9600 River Road in Pennsauken, New Jersey, the logistics center was originally built in 1964 and recently underwent a full renovation from Velocity Ventures. Property improvements included white boxed interior, roof replacement, new LED lighting, repaving the parking lot, exterior painting and loading dock upgrades. The facility features clear heights ranging from 20 feet to 35 feet, a 100% wet sprinkler system, 28 tailgate loading docks with four drive-in doors and over 3 acres of dedicated trailer/vehicle storage.
Something Big is Going on in Little Reading, PA for Real Estate and Development
by Ben Atwood Costar
Reading is officially Pennsylvania's most mysterious market.
Those following the industrial development unfolding along the Interstate 81 corridor can't help but notice some anomalies in this small market's data set that might indicate something big is afoot.
For instance: This was a dormant region until 2017 when, out of nowhere, construction popped off like a firecracker. Over the past four years, there’s been more than 11 million square feet of industrial construction, but in the 20 years prior to that period, developers added just over 7 million square feet.
In the midst of a pandemic, Reading isn't letting up. Since July, developers have broken ground on nearly 4 million square feet of new space here. That’s roughly equivalent to the market's total inventory expansion between 2004 and 2016, and much of this is speculative, meaning no tenant has been locked in before construction began.
On the surface this makes some sense, as Reading is in a nice spot for shippers. It sits on I-81, which allows goods to be moved into New York City and its sprawling suburbs in a few hours, and the interstate also serves as a direct pipeline from shipping nodes from the west and south. Reading’s also close to the I-476/I-81 intersection that makes Lehigh Valley so popular, and most of the new and underway facilities can reach that interchange within half an hour.
But it takes a lot of conviction to build on spec, and Reading's overhead data does not inspire confidence. The vacancy rate is near 13% and demand has not kept pace with the recent supply wave at all. Absorption levels from 2016 to 2019 were piddling, and a survey of the new properties shows that more than 65% is empty.
Obviously, the companies behind these projects don’t throw darts on a map when deciding where to build next. For some reason, these developers with decades of experience felt confident enough to commence construction on these massive facilities, even with the market’s historic lack of demand.
Why? The coronavirus probably plays a big part. While the pandemic has created enormous uncertainty in the office and retail sectors, it has sent e-commerce traffic through the roof and likely changed how Americans shop forever.
Across the country, industrial demand is heating back up. CoStar data shows national leasing activity for the third quarter was at some of the highest levels seen in a decade, and sifting through Reading’s data and local news reveals peculiar anecdotes.
For instance, Amazon is bolstering its presence notably within the market. Since August, the e-commerce titan announced its intentions to expand its Reading footprint by more than 1.5 million square feet in two distribution centers. Interestingly, local officials say they didn’t court Amazon — the behemoth just showed up.
Previous CoStar Insight articles noted a number of at-risk tenants occupying large space in Reading and warned some softening could be possible. But as we enter the last few months of 2020, this hasn’t happened.
In fact, local industrial demand has strengthened, and the market’s vacancies are tightening.
Amazon isn't the only tenant sniffing around and other large deals have been closed since the second quarter. CoStar forecasts Reading will absorb just over 3.5 million square feet of industrial space by the end of 2020, which is more than the combined demand the market saw between 2014 and 2019.
Where Reading goes from here is anyone’s guess. This situation has never happened before, and the coronavirus still casts a shadow of uncertainty across everything. But the acceleration of e-commerce, the strengthening local demand and the confidence national logistics developers are showing in the market mean that lots of eyes may remain glued on central Pennsylvania for some time.
TJ Maxx parent company signs lease for build-to-suit distribution center in Philadelphia
By Natalie Kostelni – Reporter, Philadelphia Business Journal
The parent company to TJ Maxx, HomeGoods and Marshalls has signed a long-term lease on a proposed 300,000-square-foot building in Northeast Philadelphia that will be developed for the company.
Once built, TJX Cos. will use the building at 9801 Blue Grass Road to expand it local warehouse-distribution operations, according to market sources. The company has maintained a 1.015-million-square-foot distribution center at 2760 Red Lion Road since 2001.
DH Property Holdings, a New York real estate firm run by Dov Hertz, owns the 21-acre property and will have Bridge Development of New Jersey build the project. A representative from TJX and DH Property couldn’t be reached for comment.
The property had been owned by Sant Properties, a Huntingdon Valley real estate firm, since 2015 when it was purchased for $1.65 million, according to Philadelphia property records. Sant sold the property to DH Property in May for $10.5 million.
The Blue Grass Road property is part of a bygone era in Philadelphia. Hostess Brands Inc. once made Twinkies at the property and ceased operations there in 2012. A vacant 446,000-square-foot food processing facility on the site was bought in 2013 by Hackman Capital Partners of Los Angeles. Hackman paid $62.5 million for the real estate and other Hostess property, such as machines and equipment, at a bankruptcy auction.
Full story: https://tinyurl.com/y295e8sm
Friday, November 13, 2020
King of Prussia's Apartment Market Bounces Back After Rough Start to 2020
By Adrian Ponsen CoStar Analytics
The initial weeks of the coronavirus pandemic were challenging times for luxury apartment properties across America. But King of Prussia, one of the Philadelphia area’s recent hotspots for suburban multifamily construction, faced particularly challenging circumstances heading into the crisis.
As developers sought to diversify King of Prussia’s office- and retail-heavy built environments, more than 1,800 new luxury apartments completed there between 2017 and 2018, doubling the local inventory of high-end units.
Property managers were pleased to see occupancy rates within most of these new projects surpassing the 90% benchmark for the first time heading into early 2020. Proximity to the more than 27 million square feet of office parks within a 5-mile radius proved key as many renters jumped at the chance to live closer to work and shorten their commutes. The newly built Villages at Valley Forge mixed-use development had also begun to differentiate King of Prussia from its surrounding suburbs, providing an oasis of walkable restaurants and other retail options in a county otherwise inundated with congested interstate highways.
Unfortunately, just as this new generation of apartment properties were nearing stable occupancy levels, public health concerns, mass layoffs and government-imposed business closures ground leasing to an almost complete standstill during the initial months of the pandemic.
To make matters even more difficult, another 638 units had just delivered in King of Prussia during late 2019 and early 2020. This tally was made up of two large projects, Le Cesse Development's Skye 750, and Hanover Cos.' Hanover Town Center. The pandemic thrust these properties into one of the most challenging periods for lease up in decades.
In order to coax new tenants into filling King of Prussia's large batch of vacant units, landlords of high-end properties dropped average asking rents by almost 6% between March and June, a time of year when rents normally rise coming out of the slow winter leasing period.
Skye 750 and Hanover Town Center, the pair of apartment communities that completed during late 2019 and early 2020, reached occupancy rates of 71%, and 41%, respectively, by the fall of 2020. Together, the two projects have averaged 17 move-ins per month since opening, a healthy pace that is slightly ahead of Philadelphia’s average lease-up rates during the three years prior to the pandemic.
King of Prussia has also had one advantage many other apartment development hotspots in and around Philadelphia haven’t. Residential development sites are beginning to run low in the Villages at Valley Forge master-planned community. After Hanover Town Center completed in February 2020, there were no other apartment projects left under construction in King of Prussia, and none have broken ground since.
All of this means that King of Prussia's latest batch of luxury communities won’t have to compete with any newer projects delivering nearby until at least mid-2022. This leaves King of Prussia’s high-end properties well positioned to outperform most luxury apartments in the Philadelphia area during the months ahead.
Thursday, November 12, 2020
Speculative Project’s 57-Acre Site Was Recently Acquired in NJ
Owners have kicked off construction of a two-building warehouse project, without any tenants lined up, in Burlington, New Jersey.
The developer secured the necessary entitlements and will serve as development manager for the 289,042-square-foot project at 2609 Rancocas Road on behalf of its partner Cabot Properties, a private equity firm. The buildings, being built on speculation, are expected to be completed by early in the fourth quarter next year.
The first building, at 217,986 square feet, will offer 36-foot-clear ceilings and will be equipped with 42 loading docks, two drive-in doors, LED lighting, 180 car-parking spaces and 28 trailer-parking spaces. The second building, at 71,056 square feet, will feature 32-foot-clear ceilings, 13 loading docks, one drive-in door and 69 car-parking spaces.
The development is located in the central New Jersey industrial market of Burlington, with quick access to Exit 47 of Interstate 295 and Exit 5 of the New Jersey Turnpike
"Despite the current health crisis, the strength of the Burlington County submarket and all of New Jersey has not slowed a bit and, if anything, tenant demand has accelerated."
Cabot Properties purchased the nearly 57-acre Burlington site for the development this month.
Earlier this year, Endurance and PCCP acquired a seven-building industrial portfolio totaling 554,000 square feet in southern New Jersey for roughly $43 million. Those properties were located in Delran, Mount Laurel and Swedesboro.
Industrial Remains 2020’s Top Performer in Commercial Real Estate Sector
By Les Shaver Globest.com
While most commercial real estate sectors are suffering from rising vacancies and falling rents during the pandemic, industrial keeps outperforming its peers.
Buoyed by continuing strength in e-commerce, the warehouse/distribution vacancy rate was unchanged in the Q3. It posted positive net absorption for the 40th quarter in a row.
Overall, net absorption came in at 20.74 million square feet in the quarter, increasing from 15.2 million in the second quarter. However, the third quarter’s net absorption was lower than the 41.7 million square feet posted in 2019.
Construction fell to 17.6 million square feet in the quarter, down from the 29.2 million square feet added in Q2. According to Moody’s Analytics, the vacancy rate remained unchanged at 10.5% in the Q3 but increased from 10.1% year-over-year.
Average asking and effective rents grew 0.2% and 0.3%, respectively, in Q3, which was an increase over the 0.1% both posted in Q2.
The flex and R&D space didn’t do as well in the quarter. Its vacancy rate increased by 0.2% to 10.3%, while it incurred negative net absorption. Overall, net absorption was negative 2.4 million square feet, which was an improvement compared to Q2’s 4.0 million square feet decline.
New completions of flex and R&D space came in at 240,000 square feet, which was the lowest quarterly change since 2012. Rent growth in flex and R&D space was nearly flat at 0.1% for asking rents and 0.0% for effective rents. In Q2, the average rent grew by 0.2%, and the effective rent fell 0.1%.
“In short, the warehouse/distribution sector is withstanding the pressures from the pandemic, while the flex and R&D sector is showing some signs of distress, similar to the office sector,” according to Moody’s Analytics. “With two full quarters into the pandemic and no end in sight, these trends of a flat warehouse and distribution and weakness in flex and R&D should continue over the next quarter and next year.”
In a separate report, Moody’s Analytics projected that industrial vacancy rates are expected to rise to 11.8% in 2021. It projects that the sector will incur its most significant drop in effective rents in 10 years, down 4.5% in 2021.
The downturn shouldn’t last long, though. Moody’s predicts that online commerce will drive a rebound in industrial. As vacancy rates decline steadily over the next five years, effective rents will rise by 1.4% in 2022.
Wednesday, November 11, 2020
A Pivotal East Coast Trade Network Looks Primed for More Industrial Development
Even before the pandemic hit, markets along vital trade arteries were experiencing rapid logistics development because of an increasing preference by consumers to shop online.
Retailers were restructuring company supply chains and leasing tens of millions of square feet of warehouse space across the country to remain competitive in a world where overnight delivery was becoming the norm.
This shopping shift set off a frenzy of development along the North Atlantic trade corridor, a region that runs roughly from Hagerstown, Maryland, to Scranton, Pennsylvania. These markets provide immediate access to every major city along the Northeastern shore, as well to respective ports and sprawling suburbs.
Since the virus has rapidly accelerated, and necessitated, the expansion of e-commerce, growth in the 10 markets that make up the North Atlantic trade corridor could continue into the future. The corridor already contains more than 1,400 warehouses and distribution centers of at least 100,000 square feet, and have a collective logistics footprint of over 445 million square feet.
“The region is just so well connected with all the nearby cities that more growth wouldn’t be surprising at all,” Doug Enck, vice president of ECD Services in Camp Hill, Pennsylvania. Enck’s firm is a third-party logistics provider, and a substantial chunk of his company’s revenue comes from driving goods from one warehouse to another. “Our biggest issue isn’t demand. It's labor.”
Since 2016, the region’s logistics stock has grown by 25%. That’s nearly 85 million square feet of commercial real estate development in a little less than five years. Much of the new inventory has consisted of buildings measuring at least 500,000 square feet, and a substantial chunk of it was contained in Harrisburg and the Lehigh Valley.
These markets are the hearts of Pennsylvania logistics. Both contain multiple major interstates, and from there, New York, Philadelphia and Baltimore can be reached in under two hours.
Lehigh’s growth over the past five years is particularly remarkable. In that time, developers have added more than 40 large-scale logistics facilities over 500,000 square feet and expanded Lehigh’s overall inventory by about 27%. In that same time, developers have added 10 massive logistics centers in Harrisburg, and demand has since spilled over into neighboring markets.
Lebanon, Chambersburg, Reading and York have experienced a remarkable uptick in construction of large-scale centers. These markets are particularly useful for servicing densely populated Maryland nodes. Hagerstown’s supply of large-scale facilities grew by over 30% since 2016, while Chambersburg’s grew by nearly 25%.
Even in large cities such as Baltimore that are not necessarily known for their logistics prowess, there has been notable growth in large facilities. About 72% of Baltimore’s logistics growth since 2016 has come by way of large-scale facilities, slightly outpacing the 68% average rate of growth of large-scale facilities across these 10 mid-Atlantic markets over the past five years.
This growth was occurring pre-pandemic, and the coronavirus has spiked e-commerce levels into the stratosphere. This has led to a surge of industrial demand across the country, and CoStar’s national-level data shows that third quarter industrial leasing volume is at the highest levels in over 15 years.
In spite of the recent wave of supply, vacancy rates in the markets along the North Atlantic corridor align with the respective historical averages. Leasing activity remains strong and, according to local shippers, the markets quickly recovered from the coronavirus.
“We saw a drop off in late April, but by June everything had normalized,” Enck said.
The shutdown brought an end to construction for much of the second quarter, but groundbreakings have ticked back up in the second half of the year. Across these 10 markets, more than 6.4 million square feet of logistics space of at least 100,000 square feet broke ground in the third quarter alone.
That marks the highest single quarter total since 2018, further underscoring developers’ eagerness to bring additional supply to these emerging nodes across Maryland and Pennsylvania.
Monday, November 9, 2020
Lowe's Inks Massive Industrial Lease in Central Pennsylvania
Lowe's has inked a massive distribution warehouse lease in Shippensburg, Pennsylvania, as the home improvement retailer is expanding its supply chain.
Lowe's signed a 10-year deal with Equus Capital Partners to occupy an entire 1.1 million-square-foot distribution facility within the Shippensburg 81 Logistics Center, the private real estate investment firm said in a statement.
The distribution facility is located at 1 Walnut Bottom Road and was built this year. It sits on a 100-acre site with frontage along Interstate 81. The cross-docked facility features a 36-foot clear height, 50-foot by 50-foot column spacing with 60-foot speed bays, 189 dock doors, 185-foot truck court and 631 trailer spaces with concrete dolly pads.
This deal comes amid Lowe's plan to grow its supply chain to improve same-day and next-day fulfillment options for customers and speed up e-commerce shipping across the country. In an August announcement, the North Carolina-based retailer unveiled its plans to open 50 cross-dock terminals, seven bulk distribution centers and four e-commerce fulfillment centers over the next 18 months. It also said it would open a West Coast e-commerce fulfillment center in Mira Loma, California, in October. Lowe's opened its first direct fulfillment center in Nashville, Tennessee, in 2018.
"Providing customers more ways to shop has never been more important," Don Frieson, Lowe's executive vice president of supply chain, said in the August announcement. "Opening these new facilities will allow our stores to operate more efficiently through improved flow management and inventory visibility and improve the customer experience with more predictable deliveries, better in-stock rates and faster fulfillment options."
Sunday, November 8, 2020
HQ in Wayne, PA Pet Valu to Shut Nearly 360 Retail Stores and Warehouses in US
By Linda Moss CoStar News
In yet another casualty of the pandemic, pet-supply retailer Pet Valu plans to shutter all its nearly 360 U.S. stores and warehouses.
The chain said it is winding down its operations, its brick-and-mortar sites in the Northeast and Midwest, as well as closing its corporate headquarters in Wayne, Pennsylvania.
"The company's stores have been significantly impacted by the protracted COVID-19-related restrictions," Jamie Gould, Pet Valu's recently appointed chief restructuring officer, said in a statement. "After a thorough review of all available alternatives, we made the difficult but necessary decision to commence this orderly wind down."
Pet Valu joins a long and seemingly ever-growing list of brick-and-mortar retailers that have been put out of business amid the COVID-19 outbreak, including Lord & Taylor and Pier One Imports.
Pet Valu U.S., operating for more than 25 years, licenses its name and contracts for services from Pet Valu Canada, a separate company headquartered in Markham, Ontario. The Canadian business, a chain with about 600 stores, is not affected by the U.S. move.
Pet Valu is owned by Roark Capital Group, a private equity firm based in Atlanta. The retailer operates small-format stores that sell premium pet food and supplies.
All Pet Valu's U.S. stores currently remain open, but the retailer said it expects to start store-closing sales in the coming days.
Friday, November 6, 2020
TSW Alloy Wheels to Open New Lehigh Valley Distribution Center
TSW Alloy Wheels has purchased an industrial building in Pennsylvania's Lehigh Valley and will be using it as a new distribution center.
The aftermarket automotive alloy wheel maker acquired the building, located at 4650 Braden Blvd. E. in Easton, from developer J.G. Petrucci Company Inc., which completed construction on the distribution warehouse this year.
TSW was drawn to the Braden Boulevard facility's access to the Northeast's major metropolitan regions, allowing TSW to further expand into the Northeast. The property's location puts more than 40% of the nation's population within a single-day's drive and will allow TSW to provide customers with their products within 24 to 48 hours, J.G. Petrucci said in a statement.
TSW's new distribution property totals 105,840 square feet and features a 36-foot clear height, a capacity of up to 26 dock doors, two drive-in doors, motion sensor LED lighting, ESFR fire sprinkler system and 4,000 amps of power. The industrial building will be divided into two suites, with TSW occupying about 60,000 square feet of the building.
TSW first opened a distribution center in Southern California before expanding its presence in the United States to eight distribution centers.
Tuesday, November 3, 2020
Monday, November 2, 2020
Mall Owners Pennsylvania REIT and CBL File for Chapter 11
By Mark Heschmeyer CoStar News
Just as the holiday shopping season swings into gear, two major shopping center and mall real estate investment trust have succumbed to the hardships retailers are facing after the pandemic forced many businesses to close and led to a rapid and massive shift in consumer spending.
Pennsylvania Real Estate Investment Trust and CBL & Associates Properties filed for Chapter 11 bankruptcy reorganization overnight after vying unsuccessfully for months to restructure their debts out of court. The REIT has owned and operated millions of square feet of retail space in more than a dozen sites up and down the East Coast and Michigan.
The owners and operators of enclosed malls and shopping centers were among the first REITs to acknowledge last spring that ongoing retailer bankruptcies and consumer and government responses to curb the COVID-19 pandemic made bankruptcy a real possibility.
PREIT filed a prepackaged financial restructuring plan under which the company seeks to be recapitalized and have its debt maturities extended.
PREIT announced last month that it had entered into restructuring agreement with more than 95% of its bank lenders. The deal was contingent upon getting approval from 100% of its lenders.
The plan calls for providing an additional $150 million to recapitalize the business. The Chapter 11 filing looks to secure court approval for a similar plan.
“We are grateful for the significant support we have received from a substantial majority of our lenders, which we expect will enable us to complete our financial restructuring on an expedited basis,” Joseph F. Coradino, CEO of PREIT, said in a statement. “With the overwhelming support of our lenders, we look forward to quickly emerging from this process.”
CBL & Associates and 176 affiliated companies also each filed petitions in the bankruptcy court seeking relief under Chapter 11, retaining the Berkeley Research Group to advise it.
CBL owns and manages more than 100 properties in 26 states, including dozens of enclosed, open-air and outlet retail centers. It said the bankruptcy filing came after months of discussions about alternatives, before executives decided Chapter 11 offered the best choice.
“With an aggregate of approximately $1.5 billion in unsecured debt and preferred obligations eliminated and a significant increase to net cash flow, upon emergence, CBL will be in a better position to execute on our strategies and move forward as a stable and profitable business,” Stephen D. Lebovitz, CEO of CBL, said in a statement.