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.