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
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