Monday, August 30, 2021

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EQT Exeter picks up 8 buildings in Delaware County for $48.45M

EQT Exeter has purchased a portfolio of buildings at Naaman's Creek Business Center in Delaware County, Pennsylvania, from SSH Real Estate for $48.45 million.

The portfolio, which was 100% leased at the time of the sale, comprises eight industrial and office buildings totaling 265,757 square feet in Boothwyn on Route 322 near Interstate 95.

All eight buildings are situated on about 45 acres and feature a diverse tenant roster of 16 companies that use the properties for warehouse, logistics, office, lab, pharmaceutical and showroom space. The largest tenant is Pentec Health, a pharmaceutical manufacturer. Other tenants included in the portfolio are Nielsen-Kellerman Co., UnitedHealth Group, Federated Healthcare Supply Inc. and Patterson Dental.

SSH, along with its family office joint-venture partner, assembled the portfolio through three separate transactions between August 2017 and April 2021. The firm paid a total of $28 million for the eight buildings.

"While we had underwritten a longer hold, the combination of value creation, and incredible investor demand for warehouse and life science product made the timing ideal for a sale," Greg Muller, partner of SSH Real Estate, said in a statement. "We and our investors are extremely pleased with the outcome and look forward to continuing to seek additional value-add investments.".

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Thursday, August 26, 2021

CoreOne Sells South Jersey Industrial Facility for $26 Million

By Teresa Blackmon CoStar Research

CoreOne Industrial LLC has sold an industrial facility in Logan Township, New Jersey, for $26 million, or about $102 per square foot.

The Connecticut-based industrial investor sold the facility to Black Creek Industrial REIT IV, CoreOne said in a statement announcing the deal. CoreOne paid $12.4 million for the property in November 2017.

The industrial facility is located at 405 Heron Drive and totals 245,220 square feet. It was built in 1980, according to CoStar data.

"The Pureland Industrial Complex is Southern New Jersey’s premier industrial park," Joe Burton, president of CoreOne, said in the statement. "We have continued to invest in the park since our first acquisition in Pureland in January, 2017 and it has been consistently rewarding. The sale of our 405 Heron Drive asset will afford us the ability to immediately reinvest back into the market as we continue to uncover value and drive return for our investors."

SK Realty Management Pays $73 Million for York Logistics Hub

By Rachel Whaley CoStar Research

SK Realty Management has purchased York Logistics Hub, a three-building complex comprising 1.4 million square feet of industrial and manufacturing space in York, Pennsylvania, for $73 million.

The real estate investment group acquired York Logistics Hub from Patriot Equities. SK Realty Management also secured a $48.2 million loan for the acquisition through a regional bank.

Located at 601, 621 and 631 S. Richland Ave., York Logistics Hub comprises three buildings called South Campus, North Campus and West Office Tower, which together were 72.5% occupied by 13 tenants at the time of the sale.

South Campus totals 743,413 square feet and is anchored by Johnson Controls, which occupies 71% of the building for its mission-critical manufacturing operation. North Campus total 548,632 square feet and has redevelopment potential. And the West Office Tower totals 116,255 square feet and can potentially be redeveloped into industrial space

York Logistics Hub is located along Route 30 and 2 miles from Interstate 83, providing access to the region's critical highway infrastructure. Its location allows tenants to reach about 412,000 residents within a 30-minute drive, along with access to over 40% of the U.S. population, six of the top 10 metropolitan areas and more than 50% of the Canadian population.

"York is a fantastic industrial location, as it has a strong labor base and good connectivity to Harrisburg and Baltimore. The sales process saw very strong interest from a wide array of investors and developers, given the great in-place cash flow with the potential in the future for re-development of new Class A warehouse."

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Wednesday, August 25, 2021

S. Jersey Industrial Buildings Built on Speculation set record with $108M Price Tag

 Natalie Kostelni Reporter Philadelphia Business Journal

A California real estate company has paid $107.74 million, or $201 a square foot, for a pair of industrial buildings in South Jersey.

Watson Land Co. bought a 283,040-square-foot building at 100 Huff Lane, and a 252,750-square-foot building at 191 Harmony Road, enters South Jersey with the purchase and expands its East Coast presence. The company, which focuses on buying and developing industrial real estate, owns properties in the Lehigh Valley.

The sale of the Cubes at Huff Lane and the Cubes at Harmony Road in East Greenwich sets a new high water mark on a per-square-foot basis for traditional a warehouse in South Jersey, according to JLL.

The seller was CRG, the real estate development and investment arm of Chicago-based Clayco.

The transaction embodies all of the aspects of the industrial market these days, particularly in South Jersey.

Banking on continued robust demand, CRG developed the two buildings in 2020 on speculation, or without any tenants lined up to fill the space. The location of the two buildings had all of the elements for success since it was adjacent to Interstate 295, a half mile from the New Jersey Turnpike and about 20 miles from Interstate 95.

The gamble CRG took paid off as have most of the speculative developments undertaken throughout the region. The real estate company landed long-term tenants for the buildings. Jaguar Land Rover North America, which is headquartered in Mahwah, New Jersey, leased the Huff Road building. Elogistics, a rapidly expanding Chinese-based third-party logistics provider, leased the Harmony Road property.

“When I first developed in Central New Jersey in 1999 at Exit 8A, I remember I was accused by my own company as being a renegade,” said Frank Petkunas, who is Northeast industrial leader for CRG and was then with a different company.

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Monday, August 23, 2021

DHL Supply Chain Begins Work on Life Science Warehouse Facility in Lebanon

 By Mannie Rivera CoStar Research

DHL Supply Chain has started construction on a new warehouse facility in Lebanon, Pennsylvania.

This warehouse is part of DHL Supply Chain's $88 million investment that includes the construction of two facilities at 3100 State Drive. The first building is a 970,000-square-foot manufacturing, warehousing and distribution facility that is set to help optimize logistics in the Northeast for a leading life science and pharmaceutical company, DHL Supply Chain said in a statement announcing the project.

"Life sciences and healthcare logistics is complex with no margin for error given the life-sustaining and life-saving nature of the equipment and supplies moving through our supply chains," Scott Cubbler, president of life sciences and healthcare at DHL Supply Chain, North America, said in a statement. "At DHL Supply Chain, we understand this complexity and have developed the industry leading team of logistics experts to implement cutting-edge solutions. Our investment in Lebanon Valley will enable our life science partner to fulfill their commitment to excellence in patient care."

The 970,000-square-foot facility is expected to be operational by the end of the first quarter of 2022 and is set to create at least 200 jobs, according to DHL Supply Chain.

Investors Spending Big on Lancaster County Industrial Properties

 By Ben Atwood CoStar Analytics 

Data shows investors have taken quite an interest in the industrial assets in Lancaster County, Pennsylvania, this year.

They've spent over $315 million buying them over the course of 2021, which is already the highest figure ever recorded in this small central Pennsylvania market. Their interest speaks to the strengths of both the logistics sector and Lancaster itself.

The coronavirus pandemic fueled an absolute surge in demand for shipping, leading to preposterous levels of industrial leasing activity across the country's major shipping nodes. This effect is particularly pronounced across central and northeast Pennsylvania, where markets such as Scranton and Lehigh Valley continue posting some of the nation’s strongest levels of demand and rent growth.

Lancaster's position on the supply chain is nowhere near as strong as either of those markets. While this county does offer direct access into Philadelphia's wealthier suburbs, it lacks the north/south highway routes that many of its neighbors offer.

But that doesn't mean there isn't demand for Lancaster space. The market's vacancies are nearly nonexistent, and there'd probably be quite a bit more leasing activity if it were easier to build here. Unfortunately for warehouse builders, Lancaster County’s residents are big on preserving their agrarian heritage and have it made it rather difficult to bring large-scale projects on line.

Barring some drastic change to local politics, there likely won't be a supply surge in Lancaster like what's being experienced in Lehigh Valley, Scranton or Reading. So, with limited supply and nearly endless demand, it's no surprise at all that prices are going up.

Take a look at this transaction involving 601 Stony Battery Road. It was completed in February 2021, and the 250,000-square-foot asset was completely vacant when it sold shortly after coming online. TA Realty out of Boston bought the property for $23.7 million, or nearly $95 per square foot.

Those prices are significantly higher than the market’s three-, five- and 10-year averages, and what’s even more interesting is TA Realty sold this same property in July. It was still completely vacant, and they weren’t marketing it for sale. But industrial investor and developer Dalfen Industrial made an off-market bid too good to pass up.

Equally curious is the fact that other markets along the North Atlantic Trade Corridor are not experiencing this same surge in investment. Sales volume for 2021 has notably dropped in Scranton, Lehigh, Harrisburg, York and Reading.

There are still four months left in the year, so obviously all of that could change. But right now, Lancaster appears to be the hottest industrial investment market in Pennsylvania.

Dalfen Industrial Picks Up Pair of Lancaster County Distribution Facilities

 By Rachel Whaley CoStar Research

Dalfen Industrial has purchased two distribution facilities in Lancaster County, expanding its portfolio in Pennsylvania.

The industrial investor and developer acquired the pair of properties from TA Realty for $70 million. TA Realty acquired the two buildings in separate transactions between December 2020 and February 2021.

The two properties involved in the deal include a brand new, 252,800-square-foot facility at 601 Stony Battery Road in Landisville and a 320,000-square-foot facility at 35 Conewago Road in Elizabethtown that was built in 2018. The Elizabethtown facility is fully leased by Grove Collaborative, according to CoStar data. Both buildings feature characteristics highly demanded by e-commerce tenants, including high clear heights, a large number of loading docks, ample parking and modern office space, according to Dalfen.

"The fundamentals of this market and location near multiple major cities such as New York City, Philadelphia, Baltimore, and Washington D.C make these assets a great fit for our portfolio," said Sean Dalfen, President and Chief Investment Officer. "In addition to the proximity to major cities, the great workforce demographics, accessibility to major highways, and robust demand in the area further substantiate the strategic fit of these properties."

With this purchase and its development in Lehigh Valley, Dalfen now owns and operates close to 2 million square feet in Pennsylvania.

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Mainfreight Inks Lease for LogistiCenter at Lehigh Valley East Facility

 By Chris Sangiuliano CoStar Research

Global supply logistics provider Mainfreight has leased an entire facility within Dermody Properties' LogistiCenter at Lehigh Valley East in Wind Gap, Pennsylvania.

Mainfreight is taking the 207,900-square-foot facility at 460 E. Moorestown Road, which was built in 2020, according to CoStar data.

"We are excited to grow our footprint to eastern Pennsylvania, further extending the capabilities and network reach we offer to our customers," René van Houtum, president of warehousing for Mainfreight, said in a statement. "With this site, our North American footprint now covers 1.8 million square feet across ten North American regional sites."

The Lehigh Valley is a desirable location for a company like Mainfreight, which was looking to expand its retail and direct-to-consumer fulfillment operations in the Eastern United States, according to Gene Preston, east region partner at Dermody Properties.

The other building at LogistiCenter at Lehigh Valley East, a 349,920-square-foot facility at 450 E. Moorestown Road, is currently available for lease.

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Tuesday, August 3, 2021

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Developer Picks Up Proposed 2.4 Million-Square-Foot Rausch Creek Logistics Center in Valley View, PA

By Mannie Rivera CoStar Research

Panattoni Development Co. has purchased a development site in Valley View, Pennsylvania, that's set to host a 2.39 million-square-foot logistics park.

Tremont FT LLC, an affiliate of brownfields redeveloper Viridian Partners, sold the site for the proposed Rausch Creek Logistics Center to the Irvine, California-based developer for $25.75 million.

Building 1, totaling 1.35 million square feet, is set to be completed by the third quarter of 2022. Building 2, totaling 1.04 million square feet, is set to be pad ready for construction in early 2022. Both Rausch Creek Logistics Center buildings are being developed on a speculative basis. The development is located at 978 Gap St., sitting immediate off Exit 107 of Interstate 81 and 18 miles from Interstate 78.

"Located in the heart of Pennsylvania’s I-78/I-81 Industrial Corridor, Rausch Creek Logistics Center will offer tenants superb access to major industrial markets in the Northeast," Hess said in a statement. “Panattoni Development specializes in build-to-suit and speculative industrial development. With limited inventory in Central Pennsylvania and the Lehigh Valley, and with a 75% LERTA tax abatement available, this state-of-the-art industrial park will attract an array of prominent industrial users.”