Wednesday, June 30, 2021

Pennsylvania Shopping Center Trades for $90M

 Ingrid Tunberg

Cedar Realty Trust has sold the 430,198-square-foot, Camp Hill Shopping Center in Camp Hill, PA to GSD CampHill Pradsavi Group LLC for $90 million.The 96% occupied grocery-anchored shopping center is anchored by Giant Food Markets and occupied by additional tenants including Boscov’s Department Store, Staples, Five Below, Barnes & Noble and LA Fitness.

Located West of Harrisburg, PA in the hub of Rte. 15 and Rte. 11, the former enclosed mall was redeveloped by Cedar Realty Trust in 2005.

Cedar Realty Trust will maintain property management responsibilities of the asset.

“Camp Hill Shopping Center is one of the many outstanding grocery-anchored shopping centers within the Cedar Realty Trust portfolio."

“There is tremendous demand for dominant grocery-anchored shopping centers nationally, given the rebound in the markets post-COVID and the attractive debt markets,” says Nathanson. “In fact, demand is outpacing the supply of first-class, high-performing assets like Camp Hill Shopping Center.”

Monday, June 28, 2021

Retail-to-Industrial Conversions (RICS) in the Industry: One Part Logistics, One Part Adaptive Reuse (Video)

How the Consolidation in Logistics Is Impacting Commercial Real Estate (Video)

Harbor Group International Pays $59.5 Million for Philadelphia-Area Apartment Complex

By Rachel Whaley CoStar Research

Harbor Group International has purchased Royal Athena, a 275-unit waterfront apartment complex in the greater Philadelphia area.

Harbor Group International acquired the multifamily property for $59.5 million, the privately owned investment and management firm said in a press release. The company didn't disclose the name of the seller.

Royal Athena is located at 600 Righters Ferry Road, about 6 miles from Center City in Bala Cynwyd within the newly rebranded Pencoyd Landing development, a $30 million, 11-acre redevelopment project. The apartment complex comprises a mix of one- and two-bedroom floor plans, according to CoStar data.

"Royal Athena is located in a strong Philadelphia submarket with healthy demographics and increasingly strong job drivers," T. Richard Litton Jr., president of Harbor Group International, said in the press release. "This strategic acquisition directly aligns with HGI's pursuit of luxury apartment communities that are attractive to residents."

Thursday, June 24, 2021

New Jersey Developer Pays $31.5 Million for Philadelphia Warehouse

 By Clarice King CoStar Research

Greek Development has purchased a fully occupied warehouse facility located about 5 miles from Center City Philadelphia.

The New Jersey-based developer acquired the property from 2121 Wheatsheaf Lane LLC for $31.5 million.

The warehouse facility totals 305,706 square feet and is situated at the base of the Betsy Ross Bridge at 2121 Wheatsheaf Lane along the Interstate 95 corridor. The property features clear heights ranging from 19 to 21 feet, 30 loading doors, one drive-in door and more than 350 parking spaces.

The mission-critical facility is occupied by Dependable Distribution Services, the largest cocoa bean distributor in North America, while a global e-commerce company uses the facility's vast parking spaces for its last-mile delivery strategy.

"This is an irreplaceable last-mile location with highly functional distribution space and ample parking," Alex Motiuk, Greek Development’s associate director of acquisitions, said in a statement. "We are excited to add this property to our presence in Philadelphia and bring it to its full potential."

"There continues to be strong demand for well-located, in-fill industrial assets within the Philadelphia region. The property offers attractive in-place cash flow with potential for future redevelopment into a new generation, Class A warehouse/distribution facility."

Why Retail Might Be The Best Value in Real Estate Today (Video)

Tuesday, June 15, 2021

Cabot Properties Buys Two-Building Logistics Complex in Elizabethtown PA

 By Rachel Whaley CoStar Research

Boston-based logistics real estate investor and developer Cabot Properties Inc. has purchased a fully leased, two-building logistics complex in Elizabethtown, Pennsylvania.

Cabot acquired the two buildings from a joint venture between Novaya Foxfield Industrial and Drake Real Estate Partners, which developed the complex in 2019. The buildings sold for roughly $21.9 million.

The two buildings are located within the 3 million-square-foot Conewago Industrial Park at 1405 and 1473 Zeager Road. Combined, the logistics buildings total 198,721 square feet and are 100% leased by Aqua Pool Supply Co. and Packaging Corporation of America.

The Elizabethtown location’s strong leasing fundamentals, labor force and proximity to major logistics infrastructure have attracted both institutional investors and a deep roster of regional and global tenancy.

"Clearly developers and investors are focused on the efficiencies of these labor-rich concentrations that tie directly into critical hubs like the FedEx Ground/Freight Hub in Middletown, Pennsylvania. The Novaya Foxfield Industrial team identified a uniquely infill opportunity and executed seamlessly in bringing the project to life."

Monday, June 14, 2021

New Jersey Cold-Storage Firm Expands Into Philadelphia

 By Linda Moss CoStar News

A growing New Jersey-based cold-storage company is expanding into Philadelphia and also plans to open another facility in the northern part of the Garden State.

FreezPak Logistics, a third-party food-logistics firm headquartered in Carteret, New Jersey, later this month is slated to debut a location at 1801 N. 5th St. in Philadelphia, its first foray into that market. The facility will be located in a property with more than 103,000 square feet that features all temperature zones — dry, cooler and frozen. The site will also have 15 loading docks, 26 trailer positions and parking for 80-plus cars.

With the rise in online grocery shopping, which got a big boost during the pandemic, the national and global demand for cold-storage warehouses has increased dramatically. FreezPak, a family-owned business that celebrates its 20th anniversary in August, has been expanding its network of distribution facilities, with four now in New Jersey and a fifth one under development.

Last November, Fidelco Realty Group and Elberon Development Group said they were constructing a 140,000-square-foot, build-to-suit facility for FreezPak at a vacant site at 1029 Newark Ave. on the border of Newark and Elizabeth, New Jersey.

In addition to Carteret, FreezPak's other Garden State facilities are in Clifton, Paterson and Wayne.

Company officials said there has been a call for them to debut distribution sites in new areas.

"Every day we are being pushed by our clients to open facilities in every major market," Dave Saoud, FreezPak's co-CEO, said in a statement.

FreezPak is designing an automated operation in Philadelphia, according to co-CEO Michael Saoud.

The company also said it will soon announce a sixth location in North Jersey to help "meet the continually growing demand for cold storage space."

The Philadelphia facility will offer cross-docking, transportation and repacking, all within 6 miles of the Packer Avenue Marine Terminal.

Cryptocurrency enters real estate industry (Video)

Thursday, June 10, 2021

Commercial REITS are delivering year to date and are up 25% (Video)

J.G. Petrucci Breaks Ground On Cigars International Expansion Project

J.G. Petrucci Company Inc. has broke ground on an expansion project for Cigars International's headquarters in Bethlehem, Pennsylvania.

The development and design/build firm is adding 100,000 square feet to the global cigar distributor's 113,500-square-foot facility at 1911 Spillman Drive in Lehigh Valley Industrial Park VII, which J.G. Petrucci developed. The facility is located on land formerly occupied by Bethlehem Steel Corp.

The additional space will serve as additional warehouse and humidor space for Cigars International. The expansion's interior fit-out will also include advanced material handling equipment and smart warehouse features, according to J.G. Petrucci.

The expansion project will be constructed by J.G. Petrucci's in-house construction group, Iron Hill Construction Management. Construction on the expansion project is set to be completed later this year.

Tuesday, June 8, 2021

TA Realty Picks Up Berks County Distribution Facility for $22.3 Million

 By Tyrone Leake CoStar Research

TA Realty has purchased a recently built distribution facility in Berks County, Pennsylvania, for $22.3 million.

The Boston-based real estate investment manager acquired the 149,632-square-foot building from a joint venture between The Keith Corp. and Kiel Group. The deal works out to about $149 per square foot.

Built in 2020, the distribution facility is located about 2 miles south of Interstate 78 and along Route 61 at 336 Logistics Drive in Shoemakersville. The building is situated on about 14 acres within Hamburg Commerce Park, a master-planned industrial development.

The facility is fully leased by S Walter Packaging and LTL Home Products. The building's features include a 32-foot clear height, LED Lighting, 24 overhead doors that are expandable to 33, two drive-in doors, ESFR sprinklers and ample parking.

Monday, June 7, 2021

Indus Realty Trust Buys Fully Leased Allentown Industrial Building

 By Rachel Whaley CoStar Research

Indus Realty Trust has purchased a fully leased industrial facility in Allentown, Pennsylvania, for $11.7 million.

The New York-based real estate investment trust acquired the single-tenant building from Jamble Enterprises, according to CoStar data. Indus used cash on hand to pay for the facility, the firm said in a statement announcing the deal.

Built in 1982, the facility is located at 6355 Farm Bureau Road within the Iron Run Corporate Center. The logistics building totals 127,500 square feet and is leased to LyondellBasell Industries.

"We believe this acquisition provides the opportunity to create significant value over time as the current in-place rent is below market and the excess land on the site provides options for potential future improvements.," Michael Gamzon, president and CEO of Indus, said in a statement. "The building complements our existing 1.3 million square foot Lehigh Valley portfolio and is located in the same corporate park as our Ambassador Drive building."

What is a Good Cash-on-Cash Return? (Video)

Cooper Health Buys Former Sears in Moorestown Mall for Outpatient Facility

 By Linda Moss CoStar News

A healthcare chain has acquired the former Sears anchor store at a New Jersey mall where it plans to open an outpatient facility.

Cooper University Health Care purchased the 165,000-square-foot vacant department store at the Moorestown Mall in Moorestown, New Jersey, from Pennsylvania Real Estate Investment Trust, according to the broker on the sale, Markeim Chalmers of Cherry Hill, New Jersey.

Terms of the transaction between Cooper and PREIT, which is based in Philadelphia, weren't disclosed.

In March, PREIT Chairman and CEO Joe Coradino announced his company and Cooper had executed a transaction for the outpatient location at the Moorestown Sears during a fourth-quarter earnings report. At the time, Coradino didn’t specify if Cooper was leasing the vacant Sears, which closed roughly a year ago, or buying it.

Cooper will transform the Sears space, which was home to the department store for decades, "into a state-of-the-art specialty care facility with an anticipated opening date in 2023."

"The landmark Moorestown Mall location has frontage on Route 38, ample parking and convenience to all major roadways," the brokerage said. "This project fits within PREIT’s business plans to expand and reposition its mall locations beyond retail. With the addition of the Cooper project alongside hospitality and housing development, this location will flourish and draw even greater regional use."

Back in March, Cooper said is was adding medical office space to meet the demand for its specialists at convenient locations near where consumers live.

Early this year PREIT, which emerged from Chapter 11 proceedings in December, said it was redeveloping Moorestown Mall and planned to add about 1,000 apartment units as well as a hotel to its Garden State retail property.

Like landlords across the country, the real estate investment trust is looking to create foot traffic and fill vacancies at its malls by adding nontraditional tenants, including healthcare and medical offices and facilities.

What the Labor Shortage Means for Commercial Real Estate (Video)

Multifamily Is CRE’s Most Liquid Sector

By Lynn Pollack

Multifamily transaction volume topped $138 billion last year and hit $32 billion in the first quarter of 2021, making the asset class the most liquid among all commercial real estate property types.

Closed-end fund closings targeting multi-housing assets have totaled $68.4 billion since 2016 and “will provide an ongoing source of liquidity,” especially as pricing discovery in the midst of COVID-19 resulted in more opportunities for private capital to invest in the space. That’s particularly true for high net worth individuals and institutional investors.  

“Amid record levels of dry powder targeting the sector and increased clarity as to rent collections and the stability of the sector, institutional investors have been becoming increasingly competitive in securing transactions so far in 2021,” the report notes. “Investors continue to target secondary markets, primarily located in the Sun Belt, as these markets are home to business-friendly regulatory and tax advantages.”

Dallas-Fort Worth, Atlanta and Phoenix emerged as the top most liquid markets in the US, supplanting the historical mainstays of Los Angeles and New York. Capital momentum is also increasingly targeting garden-style and mid-rise assets in less dense locations.

And both lenders and borrowers have strong appetites for commercial and multifamily mortgages, making debt liquidity “abundant,” the report states. Q1 multifamily mortgage borrowing totaled $51.8 billion in Q1, with agency lenders capturing 62% of loan originations. 

“First-quarter 2021 lending sources diversified as agency lenders started the year off slower following their robust originations last year,” the report states. “While banks, debt funds and insurance companies have more than filled the gap, agency lenders have taken a more competitive approach to winning business since April and we anticipate a strong second half of 2021.”

Supply continues to be a challenge for the sector, particularly among the renter-by-necessity and affordable housing segments, driving pricing. In addition, multifamily produces 4% to 6% dividend yields—better than both sovereign bonds and investment-grade corporate bonds, according to Yardi Matrix data.

Thursday, June 3, 2021

Black Creek Obtains $39.7 Million Loan To Build New Jersey Industrial Facility

 By Linda Moss CoStar News

Black Creek Group has obtained $39.7 million in construction financing for a 508,000-square-foot industrial facility it's building in Florence, New Jersey.

Black Creek's Class A industrial building at 1100 W. Front St., called Florence West, will be located on 51 acres along the Delaware River. It is near the Pennsylvania and New Jersey turnpikes and offers regional access to the ports of Philadelphia and Newark-Elizabeth as well as multiple international airports, a deep labor pool and a third of the nation's population within one-day's drive.

When it's completed, the property will feature 36-foot-clear ceiling heights, 92 loading docks and two drive-ins, as well as ample trailer, with 101 stalls, and car, with 434 stalls, parking.

"Florence West's blue-chip sponsorship, state-of-the-art design and strategic regional location were extremely appealing to lenders, who continue to increase allocations for industrial," John Alascio, Cushman & Wakefield executive managing director, said in a statement. "This drove a competitive marketing process where BMO Harris ultimately provided highly attractive terms and a seamless execution for our client."

Black Creek is building its Florence project on a speculative basis without having any tenants lined up for it yet.

The developer also has another industrial project in Florence in the works. Roughly a year ago, Black Creek paid $14.75 million for a nearly 31-acre parcel at 837 Railroad Ave. It plans to build a 300,700-square-foot warehouse-distribution facility on the site.

Where are the Commercial Foreclosures? (Summer 2021) - Video

Developer Secures $62 Million Loan To Develop Last-Mile Facility Preleased by TJX Companies

 By Charlie Dettbarn CoStar Research

New York developer DH Property Holdings has secured a $62 million senior construction loan from PCCP LLC to develop a last-mile distribution facility 100% preleased to TJX Companies Inc. in northeast Philadelphia.

The 282,737-square-foot facility at 9801 Blue Grass Road will serve as TJX's second distribution center in the city. The off-price retailer's first is its 1 million-square-foot mission-critical facility located 1 1/2 miles north of the Blue Grass road center.

"A key driver of the industrial market today is e-commerce, and there is high user demand for same day service and last-mile connectivity," Aaron Malitzky, vice president with DH Property Holdings, said in a statement. "This facility's pre-lease with TJX is one of many examples of large logistics and last-mile companies occupying space across Pennsylvania to serve the local population inland distribution markets."

Construction on TJX's second distribution facility is set to begin this month and is slated to be completed by the third quarter of 2022.

Wednesday, June 2, 2021

Joint Venture Pays $19.5 Million for Wayne Industrial Building

 By Ann Warren Harless CoStar Research

A joint venture between Mainstreet Capital Partners and Contrarian Capital Management LLC has purchased an industrial facility in Wayne, Pennsylvania, for $19.5 million.

The building is located on a 10-acre parcel just off the Swedesford Road corridor at 400 Devon Park Drive and totals 132,733 square feet. The joint venture acquired the building from Vimco Inc.

The joint venture plans to convert the building into a life science facility, which it has had success with in other markets such as North Carolina's Research Triangle region.

"This is our first acquisition into the Philadelphia market," Peter Tonon, partner at Mainstreet, said in a statement. "We think very highly of the area and hope to continue to do more transactions in the future."