Tuesday, September 20, 2022

Ipex USA Leases 251,200SF Warehouse in Middletown, PA

 By Caleb Hayes CoStar Research

Endurance Real Estate Group signed a full-building lease with plastic pipe extruder Ipex USA to fill its newly constructed Middletown Logistics Center in Middletown, Pennsylvania.

Located at 2070 N. Union St., the 251,200-square-foot bulk warehouse/distribution facility features 36’ clear heights, LED lighting and ESFR sprinkler systems, 21 door positions equipped with 40,000-lbs. mechanical levelers, bumpers and seals, one 14’-by-16’ drive-in door, 33 trailer stalls and 192 car parking spaces.

The property's location off the Middletown exit of S.R. 283 offers access to the Greater Philadelphia, Harrisburg, and Baltimore-Washington areas via I-83 and I-76, putting more than one third of the total U.S. population within a day's drive. The location's appeal to distributors is evident by the fact that four different FedEx warehouses and a new UPS Northeast Regional Super Hub are located nearby.

Based in Pineville, North Carolina, Ipex USA is the North American subsidiary of Belgium's Aliaxis SA, and specializes in extruding plastic piping for the building, industrial, agriculture and infrastructure markets.

"Our decision to develop this project on a speculative basis proved to be the catalyst in leasing the building simultaneously with its delivery to the market," said Endurance Senior Vice President Albert J. Corr in a statement. "Given Ipex’s new space requirement to the region and their desire to secure a state-of-the-art distribution facility, these factors proved to be the perfect combination to fulfill Ipex’s entry into the Central Pennsylvania market."


Saturday, September 10, 2022

Back to the Office: Employers Push for a Post-Labor Day Return

 By Katie Burke CoStar News

Employers have become increasingly adamant in their efforts to get workers to return to the office, with the week after Labor Day emerging as a turning point to reset workplace norms that for more than two years have been upended by the pandemic.

Companies ranging from small mom-and-pops to global financial giants are setting the calendar for an early September comeback that, if successful, would finally realize more than two years of efforts to get employees back working in office real estate.

Apple, Tesla, Disney and Goldman Sachs have each said they expect employees to work from an office on a more regular basis starting after the holiday weekend, a shift expected to kick off the next stage of the pandemic's impact on the country's economic landscape.

While the goal of getting workers back to some level of in-person interaction is the same, strategies in realizing it are varied. Some companies are doing away with vaccination requirements and enforcing strict return guidelines, while others are trying to lure employees back with perks such as gourmet catered lunches or renovated offices complete with game rooms, rooftop decks and coffee bars.

"The built environment has to be a place folks want to go," Rob Olivet, a senior vice president for global project management firm MGAC, told CoStar News. "Historically, office space was centered around how much square footage each person needed and economizing costs, but the pandemic has made it so that it isn't just about the dollars and cents. The COVID and hybrid workforce has prompted more attention to certain amenities, and those high-end amenities are definitely helpful in getting people back to the office."

The Labor Day 2022 return effort caps a series of delays companies made in their initial office reopening plans, with concerns stemming from a variety of COVID-19 variants, case spikes, local restrictions and mandates, as well as employee worries that kept a big chunk of America's office portfolios unoccupied at least on some days of the week since the onset of the health crisis in early 2020. However, with each postponement, workers' preference for remote or flexible work has strengthened, adding another complicated layer to employers' attempts to return to in-person operations.

Employee Retention Aid

While remote and hybrid work models were initially deployed in response to the pandemic, they have since become a significant benefit for companies looking to keep employees happy and for workers that value the flexibility, said Nicholas Bloom, a Stanford University professor of economics and a co-founder of WFH Research.

More than 90 million workers across the country, just shy of 60% of the American workforce, had the chance to work from home at least once a week in 2022, according to a report from global management consultant McKinsey & Co. Roughly 35% of the nation's workforce was able to work from home five days a week. That's a roughly sixfold increase compared to pre-pandemic days in 2019, when a little more than 5% of workers were able to operate primarily from home, according to U.S. Census Bureau data.

"The long-run trend of work from home is upwards, as it has been over the last 50 years," Bloom said, adding that work-from-home opportunities are now stabilizing as they become a permanent fixture in the U.S. economy.

As remote work became more common in the workplace, many employers were initially hesitant about if and how often workers would be allowed to remain at home.

"In late 2020 there was a big gap between how many work-from-home days workers wanted and how many employers were planning," Bloom said. "That gap has mostly gone."

Companies walk a fine line between mandating employee returns and the accelerating push for more flexibility, a trend that has been fueled by a tightened labor market and dire worker shortage. Yet, as part of the debate for when and how to get employees to return to the office, the big question emerging now is what strategy will end up sticking.

Here's a sampling of how some companies across the United States are asking workers to spend more time in the office:


Headquarters: Cupertino, California

Number of employees: More than 37,000 in the U.S.

Return-to-office schedule: The Silicon Valley tech giant told employees to prepare to return to the office for three days a week following the long Labor Day weekend. Workers will be required to head to an office on Tuesdays and Thursdays for mandatory in-person days, with a third day to be determined by individual departments. CEO Tim Cook said in June that the company's return-to-office initiative was "the mother of all experiments." The iPhone maker has received severe blowback from some employees, who argue the blanket return mandate doesn't take into account individual workers' situations.

Credit Karma

Headquarters: Oakland, California

Number of employees: About 1,300 across the country

Return-to-office schedule: The Bay Area fintech firm has been trying for the better part of the past year to get employees into its offices. The company, which relocated its headquarters to Oakland from San Francisco in 2021, recently told workers they would need to be in an office at least a few days a week on a schedule to be determined by individual teams. To make the space more attractive, Credit Karma stocked its new Oakland headquarters with perks such as a game room, coffee bar, rooftop lounge and events such as kombucha by the fire pit.

Goldman Sachs

Headquarters: New York

Number of employees: Nearly 44,000 around the world

Return-to-office schedule: The investment bank is a leader in a cohort of Wall Street powerhouses pushing employees to return to the office on a pre-pandemic schedule. While it has been competing in an increasingly tight labor market, emerging macroeconomic concerns and a volatile stock market bolstered Goldman's efforts to set a post-Labor Day return mandate. The company said Aug. 30th it would lift all COVID-related protocols such as vaccination requirements and masking, and employees would be required to return to an office on a full-time basis after the holiday weekend.


Headquarters: Philadelphia

Number of employees: Roughly 190,000 around the world

Return-to-office schedule: The cable, news and entertainment conglomerate will begin requiring a firm three-day workweek for employees across the country, with workers expected to come into an office on Tuesdays, Wednesdays and Thursdays starting Sept. 12. The schedule is a shift from an earlier policy that asked employees to be in an office for a few days each week but didn't specify when. "A big part of our culture is working together," Comcast Cable CEO Dave Watson wrote in a memo to employees last month. "It is clear that in-person interaction and collaboration is core to our company and culture. To optimize the experience while supporting the business, we’ve concluded that we need more certainty and direction to coordinate our in-office time better.”


Thursday, September 1, 2022

A recession could be great for the Philadelphia office market

 Natalie Kostelni Reporter Philadelphia Business Journal

Would a recession be just the thing the office market, landlords and central business districts need to get things back to — or at least close to — pre-pandemic levels of occupancy?

“If a recession were to occur, that balance between employee and employer could result in employers asking employees to come back into the office, and that would be great for the office market,” said Todd Briddell, CEO of CenterSquare Investment Management, which is based in Plymouth Meeting. “A recession could be a net positive for the office market, which is a little perverse.”

Briddell isn’t the only one who thinks this. Others have quietly murmured that a recession might be the way companies can flex their muscle and force employees to return to the office on a more regular basis. That said, Briddell acknowledged the labor market has proven it can maintain high levels of productivity while many employees have worked from home or maintained hybrid, flexible arrangements. Employers getting workers back to the office full-time or most of the time will need some coaxing.

“We need to earn the commute times,” he said. “I think Philadelphia needs substantial investment in infrastructure, especially in roads, to alleviate congestion and long commute times.”

Aside from the potential impact of a recession, Briddell shared his thoughts on how the firm’s focus on investing in infrastructure worked out, what investments CenterSquare is looking at these days, and where the firm is headed:

Full story: https://tinyurl.com/2mccae7u


Wednesday, August 31, 2022

Amazon Fresh to open in revamped Montgomery County shopping center

 Ryan Sharrow Editor in Chief Philadelphia Business Journal

A new Amazon Fresh grocery store is being planned for the Willow Grove Shopping Center, state filings show, as part of a multimillion-dollar overhaul taking place at the nearly 70-year-old Montgomery County retail complex.

Filings show Amazon Retail LLC has applied for a Pennsylvania liquor license to be used at 102 Park Ave., the address of a shuttered Barnes & Noble bookstore. In marketing material posted to its website, Federal Realty Investment Trust says an ongoing renovation of the 183,000-square-foot shopping center will include an unnamed "new-to-market grocery concept."

Amazon Fresh stores are considered a lower-price alternative to the company’s Whole Foods Market.

Amazon.com Inc. (NASDAQ: AMZN) opened its first Amazon Fresh store in the Philadelphia region in August 2021 in a 35,000-square-foot space at Creekview Center in Warrington. It is planning to open another store in Bucks County at a former Kmart at the Brookwood Shopping Center on Street Road in Bensalem, in addition to a location along Route 1 in Langhorne near the Oxford Valley Mall. Construction also continues on a planned site at a mixed-use project at 5th and Spring Garden streets in Philadelphia's Northern Liberties neighborhood.

The company is also planning a store at 2940 Springfield Road in Broomall, where it has also secured a liquor license to sell wine and beer, according to Marple documents. 

Full story:  https://tinyurl.com/5n7tsx5k


Tuesday, August 30, 2022

Workspace Property Trust expands suburban office presence with $1.1B deal

 Natalie Kostelni Reporter Philadelphia Business Journal

A three-story, 111,184-square-foot office building at 1200 Morris Drive in Chesterbrook is part of a $1.13 billion acquisition made by Workspace Property Trust that almost doubles the company’s real estate footprint to 18 million square feet.

Workspace has acquired 53 suburban office buildings totaling 8 million square feet from Griffin Realty Trust. The deal means that Workspace, which has offices in Horsham and Malvern, now owns 200 buildings in 22 markets across the country as the company doubles down on the future strength of the suburban office market.

Workspace first made a bet on the suburbs in 2015 when it paid $245 million to buy Liberty Property Trust’s Horsham office portfolio. A few months later, Workspace was at it again, this time spending nearly $1 billion to buy 108 office and flex buildings totaling 7.6 million square feet from Liberty. All of the buildings were in the suburbs of Philadelphia, Arizona, Florida and Minnesota.

Workspace’s initial desire seven years ago to concentrate on the suburban office market was met by skeptics who saw cities as the place for companies to attract the best talent. Many companies were also convinced of the same and established satellite offices in urban centers as alternatives to their suburban offices.

Workspace was confident in its strategy, which appears to be meeting a moment in which the pandemic is accelerating demographic trends that its executives had predicted would eventually come to fruition.

“When Tom [Rizk] and I started this in 2015, it was a huge contrarian play,” said Roger Thomas, co-founder and president of Workspace. “It was really difficult for us and we got shown the door a number of times.”

The conventional wisdom at the time was that millennials, even as they aged, would continue to live in cities because they didn’t want to drive cars or have a commute and preferred the vibrancy of urban environments over the suburbs.

Full story:  https://tinyurl.com/2p88b5xt


Encompass Health plans to build $55M rehab hospital in Norristown area

 John George Senior Reporter Philadelphia Business Journal

Alabama-based Encompass Health Corp. plans to build a $55 million inpatient rehabilitation hospital in the Norristown area.

The proposed freestanding, 50-bed medical center on undeveloped property at 2660 Audubon Road in Lower Providence Township will serve patients recovering from debilitating illnesses and injuries including strokes and other neurological disorders, brain injuries, spinal cord injuries, amputations and complex orthopedic conditions. The medical center will offer 24‑hour nursing care along with physical, occupational and speech therapies.

An Encompass Health spokesperson said the company has not yet set a timeline for when construction will begin and when the hospital will open.

The medical center will have between 125 and 175 full-time employees within five years of opening, and feature all private patient rooms, a therapy gym with advanced rehabilitation technology, a cafeteria, dining room, pharmacy and a therapy courtyard.

In a statement, Pat Tuer, president of Encompass Health’s Northeast region, said the company's business model is to improve access to "high-quality and individualized" rehabilitative care." He said the "new hospital will allow even more residents to receive specialized care close to home."

Full story: https://tinyurl.com/ytbrtfd3


Lehigh Valley industrial market spreads along Route 33, attracting developers and investors

 Natalie Kostelni Reporter Philadelphia Business Journal

Just off the Chrin interchange of Route 33 in Palmer, Carson Cos. is developing a 406,801-square-foot industrial building, adding to its 1.3 million square feet of warehouse space already built in the township.

Carson isn’t stopping with the development of 1051 Carson Court. The California company plans to construct five more buildings totaling 1.2 million square feet in Palmer, which has become a new frontier for industrial development in the Lehigh Valley.

“Route 33 is a relief valve,” said Eric Zahniser, an industrial broker with Lee & Associates of Eastern Pennsylvania. “The Route 33 corridor has really become where the expansion has been pushing. The Route 33 corridor, logistically, is ideal for companies in New Jersey looking to get out of really high lease rates and find opportunities to lease space.”

Other developers have also started to seize on the opportunity Route 33 in Palmer has to offer, including Duke Realty and J.G. Petrucci. Duke Realty is developing 33 Logistics Park, which at build-out will total 2.7 million square feet. In May, the real estate investment trust sold a 1.1-million-square-foot building it built and leased to Amazon there for $154.2 million.

Aside from Amazon, XPO Logistics, FedEx, Porsche and Mondelez International Inc. are among the tenants who have landed in Palmer, and developers such as Carson are betting more will find a place there.

Industrial development along Route 33 is relatively new and the space that has so far been built has occurred over the last five years. It has been spurred by the 2015 opening of a $40 million new Chrin interchange on Route 33 between I-78 and I-80 in Northampton County as a result of industrial submarkets morphing into one another.

Historically, submarkets — whether Bucks County, Northeast Philadelphia, South Jersey or Northern Delaware — were distinct and tenants focused on those narrow geographic areas when searching for space. Now tenants will cast a wider net and look in more expansive geographic areas such as Berks and Northampton counties when evaluating buildings to lease.

Located on the east side of the Lehigh Valley, Palmer is well positioned to capture trucks coming from the Port of New York and New Jersey as they travel west along I-78 and can jump on Route 33. The submarket also draws from Central Pennsylvania and the Philadelphia markets. It’s less than two hours from Harrisburg and just over an hour from the Port of Philadelphia.

Full story:  https://tinyurl.com/2p9x6ne9


Greek Development NJ to Redevelop Langhorne PA Warehouse for $32.1M

 By Linda Moss CoStar News

Greek Development and its partner have secured $32.1 million in financing to tear down a Pennsylvania warehouse and replace it with a new 210,564-square-foot industrial facility.

Greek Development, based in East Brunswick, New Jersey, and Principal Real Estate Investors of Des Moines, Iowa, obtained a construction loan from Provident Bank for their redevelopment of 900 Wheeler Way in Langhorne.

Greek Development and Principal Real Estate acquired the property in June 2006 for $7.9 million, according to CoStar data. They expanded the first of the two buildings on-site by 60,000 square feet in 2008. Now Greek is preparing for the demolition of a second, unrenovated building.

The new warehouse will feature 40-foot clear ceiling heights, 31 loading-dock doors, a 150-foot truck court, 80 trailer-parking stalls and parking for 242 cars. The Bucks County building is slated to be completed in the second quarter next year.

“As a best-in-class industrial warehouse in a prime last-mile market, the building’s design has been tailored to suit a variety of top-tier tenant needs,” David Greek, managing partner of Greek Development, said in a statement.“We’re eager to deliver this project in a historically supply-constrained area and to create a warehousing destination for blue-chip e-commerce, logistics and distribution companies.”

The construction loan was sourced by Greek Development’s in-house debt team in concert with the Principal’s project finance group.

The site on Wheeler Way is equidistant to the ports of Philadelphia and Newark.


Keystone Expands Life Science Conversion at Philly Landmark

 By Jack Rogers Globest.com

Keystone Development + Investment has secured a $265M loan from Nuveen Real Estate to expand its conversion of Philadelphia’s landmark The Curtis into life science lab space.

The financing from Nuveen, an affiliate of Teachers Insurance & Annuity Associates of America, will enable the developer to convert another 200K SF to lab space at the former home of Curtis Publishing, which published of the Saturday Evening Post.

A portion of the funding will be allocated to infrastructure upgrades and leasing costs at The Curtis, according to a release from Keystone.

The Curtis, a 12-tory Beaux Arts-styled structure at 699 Walnut Street, was built in 1910. The ornate building features two-story high columns on its entrance fa├žade, along with old-time street lights and steps.

Keystone purchased the 912K SF building in 2014. The developer renovated the building, adding a lobby atrium and converted existing office place in the former publishing house to luxury residential units.

Space that once held printing presses at The Curtis have been converted to wet lab space for life science companies including IMVAX, Vivodyne and Aro Biotherapeutics.

Some of the attributes that were built into The Curtis to support print publishing have made it particularly suitable to life science conversion, including 15-foor-plus ceiling heights, 200 psf vibration-resistant floors, and multiple loading docks and freight elevators.

Elements that have been added during the conversion to lab space include multiple fresh air intakes, dedicated laboratory backup emergency power and numerous venting chases.

Amenities at the property now include a 300-space covered parking garage, a childcare center, a tenant meeting and lounge suite, 24-hour card access and on-site 24/7 security.

BioLabs, a flexible lab space provider, is putting a 53K Sf incubator in The Curtis, offering life science startups turnkey space.

“We’re excited to give promising biotech startups a chance to start, grow and stay in building, embedded in a rich life science community,” said Dr. Melina Blees, site director of BioLabs Philadelphia, in a statement.

According to a Q2 2022 Venture Monitor report from the National Venture Capital Association, Greater Philadelphia has seen nearly $3.8B in VC invested in 241 deals in the region thus far this year, including an estimated $2.4B earmarked for life science projects.

Philadelphia, with an estimated inventory of more than 21M SF, is one of the five largest life sciences markets in the US, a list led by Boston, San Francisco and San Diego.

A block-wide life science campus is set to rise in Philadelphia’s Center City at 2300 Market Street, where a Breakthrough Properties, joint venture of Tishman Speyer and Bellco Capital, will develop a 200K SF life science facility.


Wednesday, August 10, 2022

REIT Buys Grocery-Anchored Center in Upland Square PA for $85.7 Million

A Singapore real estate investment trust co-sponsored by Hampshire Cos. has acquired a grocery-anchored shopping center outside of Philadelphia for $85.7 million, according to CoStar data.

United Hampshire US REIT, or UHREIT, purchased Upland Square, a 400,674-square-foot retail property at 180 Upland Square Drive in Pottstown, Pennsylvania. The seller was Paramount Realty Services of Lakewood, New Jersey, according to CoStar data.

The shopping center is 95% leased, with a tenant roster that includes supermarket Giant by Ahold Delhaize and T.J. Maxx, and is shadow-anchored by Target and AMC. Other occupants include Petco, Party City, Staples and Bed Bath & Beyond.

UHREIT is sponsored by Morristown, New Jersey-based Hampshire and UOB Global Capital. The latest transaction brings the REIT's holdings up to 23 properties. Spanning over 3.8 million square feet, UHREIT's portfolio now includes 21 grocery-anchored and necessity-based properties and two self-storage facilities along the Interstate 95 corridor, Hampshire said in a statement on Monday.

“The eastern United States’ combination of population density and high household income have ensured it continues to stand out among the nation’s retail markets," Derek Gardella, UHREIT's head of investments, said in a statement. "We expect this momentum to continue over the long-term."

Upland Square is located in Montgomery County, the third-most populous county in the Keystone State. It has a population of 836,948 with an average annual household income of $153,498.


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Tuesday, July 26, 2022

Ares Management Real Estate Secures $367M for Logistics Portfolio

 By Ingrid Tunberg Globest.com

An Ares Management Real Estate fund has secured $367.8 million to finance a 23-building logistics portfolio along the East Coast.

The 3,034,863-square-foot industrial portfolio is 100% leased to 41 tenants. The properties range in size from 7,238 square feet to 478,715 square feet.

The portfolio’s assets are located throughout the I-95 distribution corridor in the Mid-Atlantic region. Situated in New Jersey, Pennsylvania and Maryland, the portfolio includes 2000 Bishops Gate Blvd. in Mount Laurel, NJ, 3201 Pennsy Dr. in Landover, MD and 50 Route 46 E. in Totowa, NJ.

“We believe the East Coast logistics portfolio is well-situated to capitalize on the industrial sector’s rapid expansion within the Mid-Atlantic region with stable market rents and low vacancy rates. We were able to achieve competitive financing terms because of the portfolio’s ideal location throughout the most prolific industrial pockets in the country and its ability to greatly benefit from the sustained e-commerce growth.”


Thursday, July 21, 2022

NBA’s Philadelphia 76ers Plan $1.3 Billion Downtown Arena

By Andy Peters CoStar News

The Philadelphia 76ers pro basketball team plans to build a $1.3 billion arena with its own money at downtown Philly’s Fashion District shopping mall.

The 76ers reached an agreement with site owner Macerich Co. to develop the arena in a segment of the Fashion District. A new partnership created by 76ers principal owner Josh Harris, minority owner David Blitzer and student housing executive David Adelman will serve as lead developer. Harris is co-founder of private equity firm Apollo Global Management, Blitzer is an executive with private equity firm Blackstone Group and Adelman is CEO of Philadelphia-based developer Campus Apartments.

Pro sports franchises are increasingly developing stadiums and arenas surrounded by shopping districts, apartments, offices, hotels and concert venues. Mixed-use commercial districts are underway, or completed, next to facilities for the Milwaukee Bucks NBA team, the Atlanta Braves baseball team and the St. Louis City SC pro soccer team.

The proposed Philadelphia arena, to be called 76 Place, is penciled in for a site on Market Street between 10th and 11th streets. It would require the demolition of at least one building within the Fashion District complex.

The 76ers said they picked the site in part because it’s served by six mass-transit rail and trolley lines.

If the new coliseum is built, the NBA team would vacate the 26-year-old Wells Fargo Center in South Philadelphia.

Construction on 76 Place is not expected to begin “for several years” and will not be completed until 2031, when its Wells Fargo Center lease expires, the team said.

The 76ers did not say if the Philadelphia Flyers professional ice hockey team will also move to the new arena. The 76ers and Flyers share Wells Fargo Center.

Other NBA teams have recently renovated arenas or planned major upgrades, including the Charlotte Hornets, Phoenix Suns and Indiana Pacers.


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Friday, July 15, 2022

Rite Aid Downsizes Headquarters in Relocation to Philadelphia

 By Linda Moss CoStar News

Pharmacy chain Rite Aid has moved to accommodate a more remote workforce, downsizing and relocating its headquarters to Philadelphia and selling its former one in central Pennsylvania.

The retailer this week unveiled its new base on the second floor of 1200 Intrepid Ave. in Philadelphia’s Navy Yard district. It's a 23,000-square-foot space that Rite Aid in a statement called its Collaboration Center, a place that aims to bring the company's "remote corporate workforce and associates together in a modern space with state-of-the-art amenities."

Rite Aid last September announced it was moving its headquarters from a 205,000-square-foot office building it occupies at 30 Hunter Lane in Camp Hill, which is near Harrisburg.

The company owns its former headquarters property, and has put it on the block, Rite Aid spokeswoman Terri Hickey said in an email Thursday. 

Pharmacy chain Rite Aid has moved to accommodate a more remote workforce, downsizing and relocating its headquarters to Philadelphia and selling its former one in central Pennsylvania.

The retailer this week unveiled its new base on the second floor of 1200 Intrepid Ave. in Philadelphia’s Navy Yard district. It's a 23,000-square-foot space that Rite Aid in a statement called its Collaboration Center, a place that aims to bring the company's "remote corporate workforce and associates together in a modern space with state-of-the-art amenities."

Rite Aid last September announced it was moving its headquarters from a 205,000-square-foot office building it occupies at 30 Hunter Lane in Camp Hill, which is near Harrisburg.


Thursday, July 14, 2022

BioLabs To Expand Footprint in Center City Philadelphia

BioLabs, an incubator for life sciences companies, is expanding its presence in Center City Philadelphia by leasing additional space at Keystone Development + Investment's mixed-use property The Curtis.

Currently occupying 23,378 square feet at the 912,245-square-foot mixed-use property, BioLabs will expand by 30,151 square feet, totaling 53,529 square feet at the property. BioLabs' new lease will commence early 2023.

The Curtis is located at 601 Walnut St. in Center City near Independence Hall. The building was originally constructed in 1910, according to The Curtis' website.

In the past two years, Keystone has spent over $70 million in converting 200,000 square feet of traditional office space at The Curtis into labs. Keystone is looking to convert another 300,000 square feet of traditional office to life science space as well.

The Curtis' other life sciences tenants include Aro Biotherapeutics, Imvax Inc. and Vivodyne.


Wednesday, July 13, 2022

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Philly Navy Yard Plans $6B Development

 By Jack Rogers Globest.com

In the first update of its master plan since 2013, the Philadelphia Navy Yard has unveiled an ambitious blueprint for new development including almost 9M SF of mixed-use space in projects estimated to be worth up to $6B.

Last summer, PIDC, Philadelphia’s public-private economic development corporation and master developer of the Navy Yard, chose a joint venture of Ensemble Real Estate Investments and Mosaic Development Partners (Ensemble/Mosaic) to update the master plan for the Navy Yard.

The deal included a $2.6B commitment from Ensemble/Mosaic to develop 109 acres of the 1,200-acre Navy yard campus. The joint venture said $1B of its investment in the Navy Yard would be targeted for diversity, equity and inclusion (DEI) initiatives.

Ensemble/Mosaic chose James Corner Field Operations to design the master plan update, a 20-year blueprint that calls for a total of 4M SF of multifamily space, 2.8M SF of office and lab space, 1.5M SF of life sciences manufacturing, 440K SF of hospitality, 235K SF of retail and 1.6M SF of public space.

The updated master plan divides the Navy Yard into six sectors, including a Gateway District; Shipyard District; Greenway District; Waterfront District; Corporate Center and Historic Core. The plan specifies that all of the residential square footage, including a total of 3,900 multifamily units, will be located in the Historic Core and Waterfront District.

In the master plan update, Ensemble/Mosaic has increased its development commitment to $4.8B of an estimated total development worth $6B. In March, the partnership brought in Oxford Properties Group, based in Canada, as an equity partner to finance construction of the Navy Yard project.

The Historic Core includes several historic buildings protected by preservation laws and currently being used as creative offices.

The Gateway and Greenway Districts in the Navy Yard development will contain the bio-manufacturing facilities planned for the site, including a lab and a bioprocessing facility. In March, Ensemble/Mosaic broke ground for the 130K SF lab.

The new residential buildings will be the first at the Navy Yard since it housed barracks for Navy officers. Dating back to 1776—and known as the birthplace of the US Navy—the Philadelphia Navy Shipyard continued to operate as a naval base until 1996, employing more than 40,000 during WWII.

The base originally was set to close in 1991, based on a decision by the Base Realignment and Closure Commission (BRAC), an agency Congress formed to cull the US portfolio of military bases. The Philadelphia Naval Shipyard continued to operate for several years due to court challenges to the base closings.

The last ship-building project undertaken by the Philadelphia Naval Shipyard prior to its closure on September 26, 1996 was a two-year overhaul of the USS John F. Kennedy.


Tuesday, July 12, 2022

Cedar Realty Trust Sells 33 Shopping Centers for $879 Million

 By Mark Heschmeyer CoStar News

A deal for a portfolio of grocery-anchored shopping centers moves Cedar Realty Trust closer to completing the sale of itself and its remaining real estate to Wheeler Real Estate Investment Trust.

The sale of Cedar’s Northeast U.S. portfolio to DRA Advisors and KPR Centers for $879 million including assumed debt is the first step in the process.

Long Island, New York-based Cedar sold the portfolio of 33 centers and a redevelopment property to a joint venture fund managed by DRA.

Cedar previously announced the sale of itself and its assets in a series of related all-cash transactions to four different buyers, including Wheeler. The process is expected to be completed within four to six weeks, Cedar said in a release.

Cedar and DRA did not immediately respond to requests for additional information.

The deals, which combined amount to more than $1.2 billion, follow the real estate investment trust’s dual-track review of strategic alternatives last year.

Believing the real estate it owns is undervalued, In September they began exploring the sale of its entire portfolio of 53 primarily Northeastern U.S. shopping centers that collectively span more than 7.6 million square feet.

Investors are snapping up shopping centers with grocery stores as anchors because that type of tenant sparks repeat visits and generates foot traffic at a property — attributes that have become all the more valuable during the COVID-19 pandemic.


Monday, July 11, 2022

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New Jersey Office Portfolio Anchored by Lockheed Martin Trades for $16 Million Premium

By Linda Moss CoStar News

A New Jersey office portfolio with defense contractor Lockheed Martin as the main tenant has traded for $51 million, about $16 million more than it was purchased for last fall.

Regal Ventures, a real estate investment firm headquartered in New York City, on Thursday said it sold the group of five buildings, which totals 398,460 square feet, in Mount Laurel to Top Terraces, which is based in Santa Monica, California.

Regal Ventures, formerly known as Regal Acquisitions, had purchased the properties in September last year for $35 million, with joint-venture limited partner JDI Realty of Chicago. In a statement, Regal said it primarily attributed its ability to boost the portfolio's value "to the extension of existing leases with its tenants, as well as the removal of termination options."

Four of the buildings in Mount Laurel, which is about 20 miles east of downtown Philadelphia, are occupied by the Rotary and Mission Systems practice of Lockheed Martin. The company, based in Bethesda, Maryland, was ranked as America's largest defense contractor in 2021 by Bloomberg Government.

Each of the five properties is 79,692 square feet. The four buildings occupied by Lockheed Martin are 760, 770, 780 and 790 Centerton Road. The fifth one, 750 Centerton Road, is vacant.

"Regal Ventures quickly formed a solid working relationship with Lockheed Martin's lease management team," Alex Smith, co-managing partner of the firm, said in a statement. "Together, we agreed to lease modifications that enhanced the properties' overall value and elevated their appeal to prospective buyers."


Wednesday, July 6, 2022

PREIT Sells Two Parcels for $14.2 Million

 By Linda Moss CoStar News

As part of its continuing effort to pay down its debt, mall landlord Pennsylvania Real Estate Investment Trust has divested two parcels of land for $14.2 million.

PREIT, which is based in Philadelphia, on Tuesday said it sold land at the Moorestown Mall in Moorestown, New Jersey, for roughly $12 million. That site will be home to 375 residential units. The buyer is Bel Canto Asset Growth Fund, headquartered in Plymouth Meeting, Pennsylvania.

PREIT, a real estate investment trust, also reported that it had closed on the sale of an outparcel to Four Corners Property Trust, a REIT based in Mill Valley, California, for $2.4 million. That property is a Red Robin restaurant and is located in Maryland, according to Four Corners, which specializes in acquiring and leasing dining establishments.

“The property is located in a strong retail corridor in Maryland and is occupied under a triple-net lease to the corporate entity with approximately 4 years of term remaining,” Four Corners said in a statement.

PREIT, which emerged from Chapter 11 bankruptcy proceedings in December 2020, expects to close on six additional outparcels for $22 million in the coming weeks, it said in its statement. The company owns and operates shopping malls in 12 states on the East Coast, concentrated in the mid-Atlantic and greater Philadelphia region. But it has been attempting to diversify the uses at its malls, by adding healthcare tenants and multifamily units.

The Red Robin property is part of a deal that Four Corners announced in early June, where it said it had signed a definitive agreement to buy 11 outparcel properties from PREIT for $32.5 million. The portfolio includes eight single-tenant restaurants and three nonrestaurant retail properties.

“We have previously executed multiple out-parcel transactions with the PREIT team and they have been an exceptional partner for us,” Bill Lenehan, Four Corners’ CEO, said in a statement in June. “We are excited to announce this 11-property out-parcel portfolio and to continue our strategy of identifying low-rent out-parcel properties leased to strong-credit operators.”

The properties that Four Corners is acquiring from PREIT are located within highly trafficked and populated corridors in Maryland, Massachusetts, Pennsylvania and South Carolina. Each property has a separate, individual lease, and the leases have a current weighted average remaining term of about eight years, according to Four Corners.

On Tuesday, PREIT said it is continuing to implement its plan to raise capital by selling properties, with purchase and sale agreements executed for another $56 million and additional transactions in the pipeline. As part of its debt reduction plan, the company said it has applied asset-sale proceeds and excess cash from operations to pay down debt by $82 million through June 30.

“We are keenly focused on continuing to raise capital to improve our balance sheet as we simultaneously drive operational enhancements, improving the overall quality of our offering,” PREIT Chairman and CEO Joseph Coradino said in a statement. “The closing of the Moorestown land sale evidences the power of the portfolio and the real estate we have aggregated.”

The sale of land for multifamily units at Moorestown Mall “is a meaningful step toward PREIT’s vision to evolve its properties,” according to the company.

“PREIT is focused on evolving its properties into community hubs marked by a healthy mix of apartments, hotels, entertainment, dining, health and wellness, working space, and local small business retail,” the REIT said. “This initiative capitalizes on PREIT’s portfolio of bull’s eye locations to produce a broader consumer base, offering its communities more and driving success for its tenants.”

For example, Cooper University Health Care has taken over a 165,000-square-foot former Sears store at the Moorestown Mall.


Monday, June 27, 2022

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NFI Industries to occupy new 264,600-square-foot industrial building in Quakertown

Natalie Kostelni Reporter Philadelphia Business Journal

NFI Industries Inc. will occupy the Quakertown Logistics Center, a newly constructed 264,600-square-foot building just off the Quakertown Interchange of I-476.

The process that led NFI to take the space was circuitous but reflects the sometimes fast-changing needs of companies that manage the distribution of products for clients.

In July 2020, the Camden-based trucking and logistics company put 33 acres under contract just off Route 663 in Milford as Gorski Engineering Inc., the owner, sought to get the property approved for the development of a 264,600-square-foot warehouse. In October 2021, with the approvals secured, NFI closed on buying the land and moved forward with constructing the new warehouse.

In addition to trucking and logistics, NFI owns more than 60 million square feet of real estate that it uses or leases to tenants. Some of the properties are used for transportation purposes such as truck terminals and others are distribution centers.

Full story: https://tinyurl.com/mr227wv2


Thursday, June 23, 2022

Milbrook Properties Purchases Franklin Center in Chambersburg

 By Nathan Cloud CoStar Research

Milbrook Properties has closed on its first purchase in Pennsylvania as it continues to grow its shopping center portfolio.

The Manhasset, New York-based firm purchased the 174,063-square-foot Franklin Center in South Central Pennsylvania community Chambersburg from Coastal Equities. Milbrook paid roughly $20.35 million for the shopping center, according to Franklin County real estate records.

Franklin Center, located at 1320 Lincoln Way East, originally opened in 1990 and was recently renovated in 2015. The 91.5%-leased shopping center is home to a dynamic mix of anchor tenants, including Dick's Sporting Goods, T.J. Maxx, Ulta Beauty, Petco and Ollie's Bargain Outlet, which account for 78% of gross property income, according to JLL. The property also includes value-add opportunities through future building expansion and multiple out-parcel pad site development.

While this is Milbrook's first purchase in Pennsylvania, the company has been active in New Jersey. Milbrook recently paid $47 million for the 189,773-square-foot Essex Mall at 907 Bloomfield Ave. in West Caldwell — its ninth retail center in the Garden State.

"The retail sector continues to attract strong interest from institutional, REIT and private capital. "We saw a tremendous amount of investor interest for Franklin Center due to its best-in-class tenancy in T.J.Maxx, Dicks and Petco as well its irreplaceable location within the Chambersburg market."


Tuesday, June 21, 2022

Philadelphia Inquirer Inks Long-Term Lease for New Headquarters

 By Caleb Hayes CoStar Research

The Philadelphia Inquirer has signed a long-term lease at 100 Independence Mall West for its new headquarters, which is set to accommodate increased hybrid and remote work.

The 193-year-old newspaper is set to occupy 36,744 square feet on the sixth floor of 100 Independence Mall West, a 419,175-square-foot office building owned by Keystone Development + Investment that is now 97% leased.

"This move underscores our commitment to Philadelphia and our work by putting The Philadelphia Inquirer in the most historic setting in the country," Inquirer Publisher and CEO Lisa Hughes said in a press release. "We are eager to be in our new space, which we are designing to allow us to collaborate in new and innovative ways."

The Inquirer is expected to move into its new headquarters space during the first quarter of 2023. The newspaper is the latest major tenant at 100 Independence Mall West, joining The Macquarie Group, U.S. General Services Association and Nelson Worldwide.


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Monday, June 13, 2022

Singapore REIT Buys Grocery-Anchored Center Near Philadelphia

 By Mark Heschmeyer CoStar News

United Hampshire US REIT, a Singapore-based real estate investment trust, has added to its U.S. holdings, acquiring a grocery-anchored center in suburban Philadelphia.

United Hampshire acquired Upland Square Shopping Centre in Pottstown, Pennsylvania, for $85.7 million, the company disclosed in filings with the Singapore Stock Exchange.

The REIT is using money raised from the sale of self-storage properties earlier in the year to boost its holdings in grocery retail properties.

“Following the recently announced divestment of the Elizabeth and Perth Amboy self-storage properties, we are pleased to be able to achieve our goal of recycling the proceeds of the sale into a higher yielding, sizeable, stabilized grocery and necessity asset,” Robert Schmitt, CEO of the REIT, said in a statement. “Upland Square is set to substantially enhance [United Hampshire’s] income visibility and resilience.”

The 400,674-square-foot Upland Square is 100% leased with an average lease term of 6.3 years. The property is tenanted by a Giant grocery anchor, as well as off-price apparel, quick service food and beverage facilities, pet services, and a fitness facility.

With the acquisition, United Hampshire will broaden its tenant base. Rent from its top 10 tenants will reduce from the current 60.2% to 56.8%, providing increased tenant diversification and stabilizing the portfolio’s income, the company said.

Paramount Realty Services of Lakewood, New Jersey, was the seller and had purchased the property for $83.3 million in October 2016, according to CoStar data.


Saturday, June 11, 2022

Longfellow, University of Pennsylvania Partner On Life Science Facility in Philadelphia

 By Linda Moss CoStar News

Longfellow Real Estate Partners is teaming up with the University of Pennsylvania to plan and develop a 455,000-square-foot life science facility at the college's 23-acre innovation incubator, which is adjacent to its Philadelphia campus.

The project — a research, development and manufacturing hub — will mark Longfellow's first development in the Philadelphia market. The Boston-based firm is the largest privately owned commercial developer of life science buildings in the country, with offices in New York City, San Diego, the San Francisco Bay Area, and the Research Triangle area of North Carolina. Its portfolio spans nearly 15 million square feet.

The Philadelphia project will include two adjoining six-story buildings and is scheduled to open in the fourth quarter of 2025. It will be located at 3401 Grays Ferry Ave. at Pennovation Works, which was developed by the university to accommodates science facilities, researchers, entrepreneurs, and industry partners. Roughly 70 companies and an estimated 400 people are currently located at Pennovation.

The demand for purpose-built lab space is growing in the Philadelphia market, with the area now dubbed “Cellicon Valley” because of its track record of developing cell and gene therapies, according to a statement from Longfellow. The Philadelphia region is home to more than 350 life sciences firms, with many having ties to the city’s universities, research institutions, hospitals, and pharmaceutical companies.

The new project will have 387,000 square feet of research-and-development space, and 68,000 square feet of biomanufacturing space, according to Longfellow. It will feature rooftop terraces with views of Philadelphia’s skyline and Penn’s campus, as well as access to amenities at Pennovation Works. The project will include flexible lab/office space, which tenants can customize to meet their needs.

“Philadelphia and the University of Pennsylvania have a long history of academic excellence and fostering innovation," Jessica Brock, Longfellow Partner of Real Estate Operations, said in a statement. "As the region continues to be a leader in cell and gene therapy, Longfellow looks forward to delivering the infrastructure the life science industry needs to thrive.”

Partnering with an institution such as the University of Pennsylvania builds off Longfellow's track record of working with other schools such as Harvard, Duke, Stanford, and the Massachusetts Institute of Technology, according to the company's CEO and co-founder, Adam Sichol.

The new project will be near University City, home to the Hospital of the University of Pennsylvania, Amtrak’s 30th Street station, Drexel University, the University City Science Center, and Children’s Hospital of Philadelphia.

“The pace of innovation coming out of Penn is astounding. We have brilliant scientists generating a record number of new [Food and Drug Administration] approvals in the life sciences. ... Attracting Longfellow to Philadelphia and Pennovation is a vote of confidence in Penn’s efforts to grow Philadelphia’s innovation ecosystem and enable the Lower Schuylkill master plan to flourish,” Craig Carnaroli, the university's senior executive vice president, said in a statement.

Longfellow’s partnership with the University of Pennsylvania extends the firm’s East Coast presence. It has also acquired 43TEN Labs in Long Island City in Queens, New York, and partnered with the New York City Blood Center to develop Center East, a 13-story, 600,000-square-foot life science hub in Manhattan that is expected to break ground next year.


Tuesday, June 7, 2022

Walmart Goes Mega With Four New High-Tech Warehouses Including 1.5M SF in Greencastle, PA

 By Linda Moss CoStar News

Walmart, the nation's biggest retailer, is opening four new high-tech mega-warehouses to beef up its ability to get online orders to customers faster and compete with Amazon.

The Bentonville, Arkansas-based company unveiled its plans on Friday. Its expansion stood in stark contrast to those of Amazon, one of its main competitors. The Seattle-based e-commerce giant several weeks ago sent shock waves through the commercial real estate industry when it said it was slowing down distribution center development.

Walmart said it plans to open automated, state-of-the-art fulfillment centers, totaling 6.3 million square feet, in Joliet, Illinois; Lancaster, Texas; McCordsville, Indiana; and Greencastle, Pennsylvania. The one at 3501 Brandon Road in Joliet, 45 miles from Chicago, is set to open this summer. That facility is 1.1 million square feet.

The size and opening dates for the other three, which will all facilitate next-day and two-day shipping, are:

5259 W. 500 N in McCordsville, Indiana, 20 miles northeast of Indianapolis. The 2.2 million-square-foot facility is set to open spring 2023.

2500 E. Belt Line Road in Lancaster, Texas. The 1.5 million-square-foot facility is slated to open fall 2023.

1915 Ebberts Spring Court in Greencastle, Pennsylvania. The 1.5 million-square-foot facility is set to open in 2024.

Other national retailers such as Target, Macy's and Kroger have been bolstering their distribution networks — and adding advanced automation — to facilitate same-day, next-day and two-day delivery for e-commerce orders. That's an effort to put them in the same league as Amazon, especially when it comes to delivery speed. And it is also seen as enhancing their ability to increase their growing online sales.

The size of Walmart's new fulfillment centers, each over 1 million square feet, mirrors a strategy that Amazon has taken. The online retailer has built a network of mega-warehouses across the country.


Insomnia Cookies To Open New HQ & Storefront in Philadelphia

 By Michelle Stockner CoStar Research

Late-night cookie maker Insomnia Cookies is relocating its headquarters from Newtown Square to Center City Philadelphia.

Insomnia Cookies is taking the former Walgreens space at 1 S. Broad St. for its new headquarters, offering both a "store of the future" and corporate offices for about 80 employees across 26,000 square feet and three floors. Its space will also include a test kitchen.

The landlord is New York-based Aion Partners. It took three separate transactions related to Insomnia's headquarters deal. Walgreens, along with numerous large retailers, declined to renew its lease amid the coronavirus pandemic. Facilitating the complex deal required navigating retail lease terminations, leases for temporary office space and the final lease for the three-story space.

Insomnia Cookies founder Seth Berkowitz began the cookie chain out of his dorm room as a University of Pennsylvania student almost a decade ago.

In addition to opening a new headquarters, Insomnia Cookies also recently announced plans to triple its store count in the next five years to a footprint of 600 shops nationwide.


Monday, June 6, 2022

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Tennessee-Based Southern Land Co. Breaks Ground on Multifamily Project in Center City Philadelphia

 By Michelle Stockner CoStar Research

Southern Land Co. has started construction on its new 27-story multifamily development at 1620 Sansom St. in Center City Philadelphia.

The Nashville, Tennessee-based developer's latest Philadelphia project is set to include 254 luxury rental units, including multiple penthouses with private terraces. Southern Land Co. purchased the site for the development project, which was previously home to an aging parking garage, in December 2020 for $24.5 million, according to CoStar data.

The 320-foot tower will include 5,000 square feet of ground-floor restaurant space and 17,000 square feet of space on the second floor ideal for another restaurant or a health and wellness facility. Its amenities will include a club lounge, sky lounge with an outdoor rooftop pool, a fitness center with a yoga room, coworking space and resident storage. A unique feature of the building is its intentional five-foot set-back from the property line, which will widen the sidewalk along Sansom Street

Southern Land Co. utilized Philadelphia's Mixed-Income Housing Bonus program to incorporate an additional 75,000 square feet of residential space in the project, resulting in a $2 million payment to the Philadelphia Housing Trust Fund.

The 1620 Sansom St. project is set to be completed in winter 2023.

This is Southern Land Co.'s latest development project in Center City, following its under-construction, 48-story luxury condominium and apartment high-rise tower, The Laurel Rittenhouse Square, at 1911 Walnut St. That project is expected to welcome its first residents in fall 2022. The developer's first project in Philadelphia was a 28-story apartment tower at 3601 Market St., which was completed in summer 2015.


Friday, June 3, 2022

ATR Corinth Partners has sold West Manchester Town Center in York, PA

ATR Corinth Partners has sold West Manchester Town Center, a shopping center located in the southern Pennsylvania community of York.

The Dallas-based owner, manager and developer sold the 488,037-square-foot shopping center to a Paramount Realty joint venture, according to JLL, which brokered the deal. West Manchester Town Center sold for about $42.5 million, according to York County real estate records.

West Manchester Town Center is anchored by Kohl's, At Home, HomeGoods, Hobby Lobby and Burlington. Formerly operating as an enclosed mall, which opened in 1981, the property was completely redeveloped in 2014 into an open-air shopping center.

The shopping center is located on 94.1 acres at 415 Town Center Drive in an infill location. The center drew more than 4.2 million customer visits over the last year, making it the No. 2 most-visited open-air shopping center within a 15-mile radius.

"ATR Corinth did a phenomenal job executing the redevelopment by curating a dominant super-regional retail center with best-in-class anchor tenants and a complementary lineup emphasizing contemporary retail uses. We are excited to watch the Paramount Realty team continue to add value through future development, expansion of the property’s retail footprint and lease-up potential."

"We have seen renewed demand for best-in-class power centers over the last 24 months, which speaks to the positive macro performance of big box retailers as we exited the pandemic. With an extremely competitive bid process, West Manchester is a perfect example of this ongoing trend."


Wednesday, June 1, 2022

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PREIT Completes Land Parcel Sales Totaling $35M

 By Ingrid Tunberg Globest.com

PREIT has agreed to sell 11 outparcels and a vacant hotel land parcel for a total of $35 million.

The sale of the 11 outparcels will generate more than $32 million in gross proceeds for the firm.

The additional vacant parcel at Springfield Town Center in Springfield, VA sold for $2.5 million and will be developed into a hotel site. This transaction aligns with publicly-traded REIT’s mission to deliver one-stop destinations in its communities.

The firm expects the outparcel transactions to close in multiple phases, primarily before June 30, 2022. The hotel parcel transaction is expected close in Q4 2022.

The deals are included in the firm’s asset sale pipeline, which was presented in the REIT’s Q1 2022 earnings release earlier in May, and includes $275 million of in-process transactions.

“Our plan to raise capital is materializing as a result of a portfolio that is thriving due to our efforts to bring in dynamic and compelling uses and our optimally-located platform,” states Joseph F. Coradino, chairman and CEO of PREIT. “We have a clear mandate to raise capital and improve our balance sheet and we are unwavering in our commitment to generate results. As new opportunities continue to arise, we are confident we can strategically harvest value from our portfolio to reduce debt.”

By June 30, 2022, PREIT expects to close on asset sales totaling $109 million in gross proceeds.


Tuesday, May 24, 2022

Puttshack To Open First Philadelphia Location in Center City

 By Javon Roach CoStar Research

Puttshack, an upscale, tech-infused mini golf venue, has signed a lease in Center City for its first Philadelphia location.

Puttshack is set to occupy 26,000 square feet within the Shops at Liberty Place at 1625 Chestnut St. for its maiden Philadelphia venue. The Philadelphia location is expected to open in summer 2023.

Puttshack opened its first two U.S. locations in Atlanta and Chicago in 2021, joining its four locations in London. New locations in the United States will open this summer in Boston and Miami, followed by Denver, Houston, Pittsburgh, Scottsdale, St. Louis, Dallas, Nashville and its second Atlanta location in 2023.

Its Center City location is set to include four tech-driven mini golf courses powered by its patented Trackball technology that keeps score and a "globally inspired" dining menu and cocktail program, Puttshack said in a release. The venue will also have multiple semi- and fully private event spaces for parties and include full-service bars.

"Philadelphia's bustling Center City blends historic sites with skyscrapers and premier destinations, making it a perfect choice for Puttshack," Dave Diamond, president of Puttshack, said in the release. "We can’t wait to bring our tech-infused mini golf experience to Philadelphia and be a part of such a historic and bustling neighborhood of the city."


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Tuesday, May 17, 2022

Breakthrough Properties to Develop 200K-SF Life Science Project

 By Ingrid Tunberg Globest.com

 Global developer of life science real estate Breakthrough Properties has acquired a site in Philadelphia with plans to develop more than 200,000 square feet of best-in-class life science space.

Through the project, Breakthrough Properties aims to support Philadelphia’s growing demand for modern lab space.

Located on the 2300 Market St. block in Philadelphia’s Center City district, the site is situated near University of Pennsylvania, Drexel University and leading academic medical centers. The property is located between the lifestyle hubs of Rittenhouse Square and University City, and it offers nearby access to the 30th St. transit station, which provides access to the SEPTA bus, trolley and commuter rail lines and Amtrak train routes.

Greater Philadelphia is ranked first in the nation for the National Institutes of Health grant funding for cell and gene therapy. In 2021, the area attracted more than $3.8 billion in venture capital and NIH funding.

“Driven by a highly-educated workforce and an influx of funding flowing to its world-renowned academic research institutions, hospitals, biotech companies and innovative start-ups, Philadelphia has quickly established itself as a leader in the cell, gene and mRNA therapy space, which is driving increasing demand for high quality lab space,” states Aaron Kazam, SVP of acquisitions at Breakthrough Properties.

Kazam adds, “We are thrilled by this opportunity to deliver one of the premier research and development buildings in the country, just steps from 30th St. station and the institutional core at University City.”

For the project, Philadelphia-based D2 Capital Advisors assisted with site selection and will serve as financing advisor. Philadelphia-based architecture firm KieranTimberlake has been retained by Breakthrough Properties as project architect, and Cushman & Wakefield will serve as the development’s exclusive leasing agent.

The firm expects the project to be completed in 2024. The development represents Breakthrough Properties’ first project in Philadelphia.

The company now has more than 4.6 million square feet in its development and under-construction pipeline across the US and Europe. The firm targets LEED Gold certification at all of its US properties and BREEAM Outstanding certification in all of its projects across the UK and European Union.


Monday, May 16, 2022

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DH Property Holdings Acquires Philadelphia Industrial Asset

 DH Property Holdings, LLC, a leading developer and owner of urban infill industrial logistics facilities, has acquired 200 Pattison Avenue in Philadelphia, Pennsylvania, for $24 million. The fully tenanted 96,000-square-foot warehouse facility was formerly owned by Ivy Realty. The transaction marks DHPH’s sixth Class-B infill industrial asset acquisition in the last six months as part of the newly launched EIB Ventures I LP fund.

The Pattison Avenue property, set on 7.08 acres, features 25,000 square feet of cold storage, 19,000 square feet of freezer storage, 16 loading docks, 12-foot to 17-foot clear ceiling heights and additional features. 200 Pattison Avenue is fully occupied by tenants Preferred Meals, which has been a tenant for nearly 30 years, and Tristate Intermodal. Situated in South Philadelphia, only minutes from the city center, the property provides convenient access to the Philaport, I-95 and I-76.

This is the 4th  Class-B industrial building acquisition in Philadelphia for DHPH for a total capitalization of $49.2 million across 280,000 square feet of space. As part of EIB Ventures I, DHPH has acquired six Class-B industrial buildings in the Northeast since June 2021, for a total capitalization of $102.3 million across 548,000 square feet. 

In addition to its existing properties, DHPH currently has over 5 million square feet, or over $2.5 billion, of Class-A urban warehouses complete or under development throughout the Northeast, including in New York City, Boston and Philadelphia.

The Newmark team of Michael Margolis, senior managing director; David Dolan, senior managing director; J Eustace Wolfington III, senior managing director, and Ryan Guittare, associate director, represented DHPH and Ivy Realty in the transaction.

“The acquisition of 200 Pattison Avenue further expands and diversifies the company’s portfolio,” said Hertz. “The property is positioned to thrive as demand for logistics space in the market continues to grow, and it provides powerful long-term value.”

Founded in 2016 by Dov Hertz, DHPH is a Manhattan-based industrial real estate development, investment and management firm that has been at the forefront of the industrial logistics trend, developing best-in-class distribution warehouses in complex and challenging urban environments. The company developed 640 Columbia Street, the first multi-story logistics center in New York City.


NJ Based, Lamar, Real Capital Snap Up Sixth Shopping Center for $60 Million

 by Linda Moss Costar

New Jersey-based Lamar Cos. has purchased a shopping center in Pennsylvania for $60 million, one of a half-dozen acquisitions of retail properties it's recently closed totaling over $165 million.

Lamar, based in Fairfield, in conjunction with Real Capital Solutions of Louisville, Colorado, bought The Shops at Valley Square, a 293,550-square-foot "lifestyle center" in Warrington, Pennsylvania. The seller in the April transaction was Ares Real Estate Management Holdings of Los Angeles.

Prior to that, in February, Lamar and Real Capital acquired a four-shopping center portfolio in Puerto Rico. And in December last year, they purchased Stone Creek Towne Center, a shopping center in Cincinnati, for $25.8 million from DRA Advisors of New York City.

The Lamar-Real Capital partnership has acquired nearly $500 million in total over the past 11 years and is continuing to seek shopping centers across the United States and Puerto Rico.

The most recent purchase, The Shops at Valley Square, is a Class A, mixed-use lifestyle center with retail, office and the potential for multifamily development for over 300 units. It has roughly 293,550 square feet and was built in 2007.

The center is located in an affluent suburb about 16 miles north of Philadelphia at the intersection of Street Road and Easton Road, two of Bucks County's busiest commercial arteries, with cumulative traffic counts exceeding 69,000 vehicles a day, according to Lamar.

In addition to being shadow-anchored by a high-performing Wegmans supermarket, the Valley Square center features a tenant mix that includes Ulta Beauty, DSW, Banana Republic, P.F. Chang's, Playa Bowls and Panera Bread.


Friday, May 6, 2022

Philadelphia-based PREIT Mall Landlord Offers Long-Term Game Plan

 By Linda Moss CoStar News

Mall owner Pennsylvania Real Estate Investment Trust plans to raise capital, with $275 million in property sales in the works, to help pay down its debt and looks to unveil a long-term plan to address its nagging financial woes this summer.

Philadelphia-based PREIT reported its first-quarter earnings on Thursday, with CEO Joseph Coradino discussing the company's balance sheet, which at this juncture presents a much less rosy picture than its retail operations. The real estate investment trust, which is at risk of being delisted by the New York Stock Exchange, is poised to receive a one-year extension on its credit facilities, Coradino said during a conference call.

"It’s clear that the mission in front of us is to achieve the credit-facility extension and to raise capital to delever the balance sheet,” he said. "New opportunities to harvest capital are presenting themselves as a result of the strength of the markets we operate in and the compelling opportunity we’ve created."

PREIT said it expects $109 million of its $275 million in pending deals to close before June 30. The company already sold the Exton Square Mall in Exton, Pennsylvania, in March for $27.5 million.

The firm was one of three retail-property REITs to file for Chapter 11 bankruptcy protection in 2020 amid the pandemic, when temporary store closures to stop the spread of the coronavirus wreaked havoc on malls and retailers. PREIT emerged from the proceedings after restructuring about a month after it filed. But it hasn't been an easy road back since then, as PREIT has sustained more than $600 million in losses since 2021, with $39.3 million in the first quarter this year.

In its first-quarter supplemental materials, PREIT said as of March 31 it was in compliance with the terms of its credit agreements.

"However, a material decline in future operating results could affect our ability to comply with the financial covenants, including additional covenants that came into effect starting on June 30," PREIT said.

But on the call, Coradino was reassuring, saying, "We are developing a longer-term plan that will demonstrate value to shareholders and an improved balance sheet that we expect to detail for you this summer."

He touted the strong performance many PREIT malls have enjoyed in the wake of the pandemic. For example, mall sales per square foot hit $613 in March, up from $603 at the end of last year. And strong leasing activity led to core-mall occupancy reaching 94%. PREIT has also had success finding tenants for vacant anchor stores.

PREIT is reviewing its options for the upcoming debt maturity, later this year, for the Cumberland Mall in Vineland, New Jersey, the Woodland Mall in Grand Rapids, Michigan, and the Cherry Hill Mall in Cherry Hill, New Jersey, according to Coradino. All three of these properties have recently experienced strong sales and occupancy growth, he said.

The REIT's portfolio includes 25 retail properties, 24 of which are operating properties and one is a development property. The 24 operating retail properties have a total of 19.6 million square feet and include 20 shopping malls and four other retail properties.

In February, the NYSE informed PREIT it was out of compliance with the exchange's listing standards, which require a company's common stock to maintain a minimum average closing price of $1 per share over a consecutive 30-trading day period.

PREIT has until Aug. 4 to regain its compliance and is reviewing its options with its with advisers and board, according to Coradino.


Tuesday, April 26, 2022

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Exelixis Boitech Chose Philadelphia for Its East Coast Hub

 By Katie Burke CoStar News

It has roots in Boston and a recently expanded corporate headquarters in the San Francisco Bay Area, but life science firm Exelixis is planting a flag in the Philadelphia suburbs as demand for research and development space across the country fuels momentum in second-tier biotech markets.

The East Bay developer of cancer drug treatments is setting up a temporary office in King of Prussia, Pennsylvania, as it shops around for sites in the area that would accommodate an East Coast headquarters with up to 200,000 square feet. Exelixis said it is ultimately hoping to house between 135 to 140 employees at the location, which it is expecting to develop within the next two to three years.

The Alameda, California-based company signed a 23,000-square-foot lease at the Brandywine-owned Freedom Business Center to use as a placeholder until its "Exelixis East" hub is developed. The office — which Exelixis said it anticipates will be used for about two years — is slated to open in June.

“We’re growing and expanding our pipeline so our need to bring in talent is increasing,” Exelixis President and Chief Medical Officer Vicki Goodman said. “When we look at where the pharmaceutical and biotech talent is, there is a nexus on the West Coast, which is where the Alameda campus is, and there is one on the East Coast," she said, adding that the Philadelphia area "is an ideal place to set up a center of operations.”

And with fierce competition for space and employees in upper-tier biotech hubs such as Boston, Philadelphia's solid talent base, proximity to other major cities and universities, as well as cheaper lab space, combined to make it the choice from which to grow.

"We’re making a real commitment to the Philadelphia area, it's not a satellite campus for us," Goodman said, adding it could become a "launching pad to expand to Europe."

Exelixis was founded in the early 1990s in Cambridge, Massachusetts, and relocated to California several years later. In 2019 the company preleased a roughly 220,700-square-foot development at 1951 Harbor Bay Parkway to expand its headquarters, which is now moving through the final build-out stages.

Spillover Fuels Growth

The biotech firm is one in a string of research and development companies vying for a dwindling pool of available lab space across the United States. Advances in biotechnology and record levels of venture capital have resulted in the largest construction pipeline of life science projects in the nation's history, with about 25 million square feet of space underway in the nation's 12 largest biotech clusters.

Even with the unprecedented amount of new and incoming space, the gap between what's available and what tenants are demanding is widening, driving rents for life science space to all-time highs and pushing companies farther away from prime biotech clusters in pursuit of space that can accommodate their own unprecedented growth spurts.

In the San Francisco Bay Area, for example, about 3.3 million square feet of life science space was underway by the end of 2021, according to data from brokerage Kidder Mathews. It wasn't even close to the roughly 5.7 million square feet of space that prospective tenants were hunting for, however, and about 50% of the under-construction developments were already preleased.

With the shortage of space in top-tier biotech clusters such as San Diego, Boston, the Bay Area and Seattle becoming increasingly burdensome for tenants, some are beginning to shift their attention to alternatives such as Philadelphia in a move that has helped catapult the secondary city to the forefront of the life science sector's accelerating growth.

"Philadelphia is sitting in a terrific position both because of its own trajectory and because of its spot relative to other leading biotech clusters," Joseph Fetterman, Colliers' executive vice president of healthcare and life sciences, told CoStar News. "The Philadelphia area is proving to be increasingly attractive to companies on the West Coast looking East and those that are getting priced out of Boston. And there's a reason to look at Philadelphia since it's complimented by the fact that, relative to other markets, it offers a significant discount in terms of basic rent for space and the overall cost of living."

By the end of the first quarter this year, average rents for lab space in the Boston area were about $110 per square foot, according to CoStar and Colliers data. By comparison, typical rents in Philadelphia were less than $54 per square foot.

The city has also become popular among startups or firms preparing to graduate from incubator space. Nearly 2.25 million square feet of lab and research space is under construction in the Philadelphia area. Developers are pitching another 9.7 million square feet in order to capitalize on the swelling demand.

"We're looking at a strong pipeline here in Philadelphia that will be buoyed significantly by increased interest from outside the city that will absorb a lot of space," Fetterman said. "We're going to start seeing a dynamic shift in the market for larger spaces as companies relocate to the city and grow within it."


Ireland-based Applegreen To Relocate US Headquarters to Glen Rock, NJ

by Linda Moss Costar

Ireland-based Applegreen, the largest highway rest stop operator in the United States, plans to invest $126 million in New Jersey, opening an American headquarters in Glen Rock, revamping nearly two dozen of its Garden State locations and creating roughly 900 jobs.

The commitment, announced Monday, is the biggest news so far to come out of New Jersey Gov. Phil Murphy's four-day economic mission in Ireland, a trip where he's promoting investment in his state. At a joint news conference in Dublin, the governor welcomed Applegreen’s financial commitment and the improvement it will make to the area's travel infrastructure.

Applegreen, based in Dublin and a major highway service plaza operator in Europe as well as the United States, describes itself as "a major petrol forecourt retailer."

Applegreen said it will relocate its U.S. travel plaza headquarters to Glen Rock, a Bergen County municipality where it already has a presence, adding at least 100 new jobs in finance, administration, development and logistics to the region.

“Northern New Jersey proved an ideal location for our headquarters as it is centrally located amidst many states in which we operate, is close to several major airports and offers top talent for our rapidly growing business," Elizabeth Pierce, president of Applegreen USA operations, said in a statement.

The governor's office referred questions on the current location of Applegreen's U.S. base and exactly where it will be relocated in Glen Rock to the company. Applegreen didn't immediately respond to emails from CoStar News seeking comment.

Applegreen will also be redeveloping all of its New Jersey’s rest stops, a move that will create 800 new jobs over the coming years. The first two redevelopments, at the Woodrow Wilson and Molly Pitcher travel plazas, are expected to be completed before the Fourth of July holiday.

“Applegreen is a world-class travel infrastructure partner who will generate significant economic growth for the state and bring innovation and expertise to the redevelopment of New Jersey’s 21 on-highway services plazas," Murphy said in a statement, where he also described himself as a proud Irish American.

Applegreen has more than 250 sites across 18 states including New Jersey, where the redeveloped plazas will offer commuters the latest technologies and will focus on electric-vehicle charging. In the states, Applegreen is installing EV infrastructure throughout the Northeast, which is in addition to its existing infrastructure portfolio in Europe.

The company acquired the concession for its Garden State service plazas last summer. It has a U.S. workforce of more than 5,000 employees, and its plaza redevelopment project is expected to create at least 800 new jobs, in addition to the 100 skilled new positions created by the relocation of its headquarters.

“Our Northeast footprint is expanding rapidly. ... The creation of hundreds of new jobs through these exciting projects will deliver a significant boost to the New Jersey economy, and, as such, today’s announcement is a genuine Irish-American win-win,” Pierce said.

Applegreen was taken private in March 2021 by a partnership comprised of its founders, Bob Etchingham and Joe Barrett, and Blackstone Infrastructure Partners, a leading investor in U.S. infrastructure assets.