Friday, March 31, 2023
Thursday, March 30, 2023
Wednesday, March 29, 2023
BioMérieux tripling Philadelphia footprint with first lease at new Navy Yard building
Paul Schwedelson Reporter - Philadelphia Business Journal
Development of 1201 Normandy Place, a life sciences and lab building at the Navy Yard, is nearing completion. The 137,000-square-foot building is planned to open in June.
Fast-growing French biotechnology company bioMérieux has outgrown its space at the University City Science Center and will relocate into 32,000 square feet at a building under development at the Philadelphia Navy Yard.
It’s the first lease signed for the new building at 1201 Normandy Place, a project scheduled to open in June. BioMérieux plans to move there in early 2024. The building is being developed by Ensemble Real Estate Investments and Mosaic Development Partners in partnership with Oxford Properties.
BioMérieux bought Philadelphia-based Invisible Sentinel in 2019 for $75 million. The new site will house Invisible Sentinel, a provider of DNA detection tools to protect against impurities in food, beer, wine and medical cannabis production.
“This is going to be a showcase for our company,” said Ben Pascal, bioMérieux’s global head of its xPRO Program and chief business officer of Invisible Sentinel
For now, there’s about 45 employees working out of Invisible Sentinel’s 10,000 square feet at the Science Center. The new space allows for the company’s significant growth to continue and for the company to add “quite a number of jobs over the next few years” in both biotech research and development and also in manufacturing, Pascal said. The lease is for 10 years, he said.
Since bioMérieux bought Invisible Sentinel, Pascal said Invisible Sentinel has seen "significant double-digit growth year over year" in both revenue and production volume. Space in its University City location had become tighter as the company increased its employees and operations, creating a need for what 1201 Normandy can provide.
“It’s beautiful. The space and the building we’re moving into is top of the line, state of the art,” Pascal said. “[It] can support our manufacturing operation, has the equipment, has the infrastructure.”
1201 Normandy is the first speculative multi-tenant research and development lab building at the Navy Yard in South Philadelphia. The 137,000-square-foot building is designed to be optimized for cell and gene therapy companies and able to accommodate all life sciences users.
Ensemble Managing Director Mark Seltzer said bioMérieux’s lease proves speculative life sciences development in the Navy Yard can be successful. BioMérieux is taking most of the second floor of the four-story building, which leaves about 100,000 square feet remaining. The Navy Yard is a 1,200-acre campus that's become a hub for life sciences companies. The team of Ensemble and Mosaic is developing part of the property with a $6 billion development plan scheduled to take place over the next two decades.
Invisible Sentinel was founded in 2006 in University City and Pascal said it was important to remain in Philadelphia. He’s found it beneficial to be in a life sciences hub like University City to be aware of new industry trends, innovations and in close proximity to similar companies and workers. Being in the Navy Yard could provide a similar experience near other life sciences companies. And a brand new building means more opportunities.
Full story: https://tinyurl.com/ctancuer
Tuesday, March 28, 2023
Monday, March 27, 2023
Wednesday, March 22, 2023
Tuesday, March 21, 2023
Monday, March 20, 2023
Friday, March 17, 2023
Penn State puts two Philadelphia Navy Yard buildings up for sale
Paul Schwedelson Reporter - Philadelphia Business Journal
Penn State's building at 1101 Kitty Hawk Ave. is up for sale. It was built in 2015 and has 26,709 square feet.
Penn State University has listed two Philadelphia Navy Yard buildings totaling 65,057 square feet for sale as the school relocates remaining offices at the locations elsewhere.
The buildings had been used for academic programming, research, startup incubator space and events. Those uses have already moved out while some administrative offices remain but will also eventually relocate.
Penn State spokesperson Wyatt DuBois said the school is selling the properties because they have been underused. Penn State is still planning where the administrative offices will move, he said.
The pair of two-story buildings for sale are at 4960 S. 12th St., also known as Building 661, and 1101 Kitty Hawk Ave., or Building 7R. The two buildings face each other with South 12th Street in between. League Island Park is just north of Building 7R and the Delaware River is two blocks to the south.They could be sold together or separately, said CBRE broker Robert Fahey, who has the listing.
Either way, Penn State is looking for a combined $20 million for the buildings, Fahey said.
Building 661 was built in 1942, renovated in 2014 and has 38,348 square feet. Building 7R was built in 2015 and has 26,709 square feet. Both are in a CMX-3 zone, which allows for office, life sciences, medical office, industrial, multifamily and retail. The two buildings will be fully vacant once sold.
“They’re both very adaptable to a series of potential uses that fit in very well in that innovation system that’s thriving in the Navy Yard,” Fahey said.
Full story: https://tinyurl.com/25y5hxsx
Thursday, March 16, 2023
Monday, March 13, 2023
Philadelphia Emerges as Top Mid-Atlantic Industrial Market in 2023
While fluctuating market conditions and increased construction expenses have led to a slowdown in financing and groundbreakings for some new projects, many that are already underway are continuing. Even though demand has softened, supply-side dynamics in early 2023 remain robust due to the delayed nature of real estate development.
The categories where Philadelphia has eclipsed other Mid-Atlantic markets include the most new industrial space added over the past 12 months, at 15.3 million square feet; the most new space under construction, at 27.7 million square feet; and the highest annual absorption volume, at 11.1 million square feet. Of the industrial property projects under construction in the Philadelphia region, approximately 25% have been pre-leased.
By comparison, New York, the second highest performer across the Mid-Atlantic, delivered 9 million square feet in the past 12 months, has 21.8 million square feet under construction and clocked in a negative annual absorption rate of -1.2 million square feet.
Philadelphia’s proximity to one of the largest ports in the country, the ports of New York and New Jersey, has positioned the metropolitan area to capture spillover demand from New York and Northern New Jersey. The port’s 25% increase in processing volumes from 2020 had temporarily elevated the port to become the country’s busiest in late-2022, further fueling strong industrial growth in nearby locales.
Philadelphia was equipped to attract occupiers seeking alternatives to New York and Northern New Jersey’s highly saturated, traffic-burdened and costlier markets. Operationally, the Philadelphia area can serve the country’s densest populations within a day’s drive at about half the rent expenses of New York and a steep discount to average industrial rents in Washington D.C., Northern New Jersey and Boston. These factors have geographically and economically positioned the Philadelphia area to capitalize on recent spillover demand. Additionally, Philadelphia's port is the largest refrigerated port in the country.
Burlington County in southern New Jersey has helped to significantly drive the Philadelphia area’s recent industrial real estate performance. This county alone accounts for 32% of Philadelphia’s inventory under construction, 36% of annual delivery, and nearly 50% of annual net absorption. When evaluating smaller locales across the U.S., Burlington County is among the top 10 highest-performing industrial submarkets among the 2,900 covered by CoStar. Cecil County and Gloucester County have also significantly contributed to Philadelphia’s overall industrial performance.
Philadelphia’s supply-side metrics are solid, but at the same time, it begs the question of whether demand is sufficient to absorb the immense amount of new space that will hit the market over the next couple of years. While 7 million square feet, or 25%, of developments under construction, have already been pre-leased, 31 million square feet remains available across existing industrial sites in the Philadelphia area. In a simplified snapshot, this results in 52 million square feet of available spaces actively looking for occupants.
It will be interesting to see if leasing momentum keeps up with the performance seen between 2020-22, which averaged 28.5 million square feet of space absorbed annually. At that rate, the numbers look manageable, even with moderately softened demand ahead.
Given Philadelphia’s recent absorption performance, strategic location and economic advantages mentioned earlier, it is a well-established contender to continue attracting retailers, manufacturers and third-party logistics companies over the short and long term.
by By Brenda Nguyen Costar
Friday, March 10, 2023
Wednesday, March 8, 2023
Monday, March 6, 2023
Wednesday, March 1, 2023
Tuesday, February 28, 2023
Monday, February 27, 2023
Subleases: The Rising Tide That Floods the Office Market
By Phil Mobley Market Analyst
The onset of the COVID-19 pandemic in early 2020 plunged the U.S. office market into an extended period of stagnant demand.
Since the beginning of 2020, office tenants have given back a cumulative 115 million square, and true recovery has yet to begin, with net absorption, the difference between move-ins versus move-outs, remaining negative for an unprecedented third consecutive year in 2022, albeit only marginally so. Meanwhile, the national average vacancy rate at the end of 2022 was 12.5%, 300 basis points above where it sat at the end of 2019. Entering 2023, both office performance metrics were still trending negatively.
But these weak fundamentals are not the only sign of the pandemic’s unique impact on the office sector. A sustained surge in sublease availability may be the surest signal of a persistent pivot in the way tenants use office space—one that could still be reverberating for years to come.
A Massive Wave
The most striking aspect of the recent rise in sublease inventory is its sheer size, the impact of which loses nothing in comparison with the much smaller increase that occurred during the Great Recession. Office sublease availability started rising at the beginning of 2007, even before the recession. By mid-2009, it would grow from around 95 million square feet to just over 147 million square feet, an increase of 55%.
The sublease inventory increase in the current cycle has been far greater, exploding from 121 million square feet at the end of 2019 to 245 million at the end of 2022. This 103% increase is more than twice as large in square footage as the one during the Great Recession and has also already lasted six months longer before reaching a peak.
When tenants make space available for sublease, they are often attempting to cut their own short-term losses on space they no longer need. Thus, they are sometimes willing to offer the space at rents well below what it would cost a new tenant to acquire it directly from the landlord. In some markets, this discount can be 30% to 40% or more. Thus, while the landlord may not suffer lost revenue immediately, a large amount of sublease inventory can depress the market by holding down the price of competitive space.
Furthermore, the longer this excess inventory lingers on the market, the greater the risk that it will eventually become direct vacancy, taking income out of the landlord’s pocket. The fact that the current sublease wave does not appear to have crested means that this downward pressure on rent and net operating income could last for some time.
A Broad Landfall
The impact of the surge in office sublease space is as broad as it is deep. Only a handful of primary and secondary markets have seen anything other than a substantial increase in sublease availability since 2019. For most, the increase in the amount of sublease space has been at least 50%; for many, it has been double, triple or more.
Nationally, the sublease availability rate, or the amount of sublease space available as a percent of total inventory, reached nearly 2.5% at the end of 2022, but for some markets, it is much higher. San Francisco, which has been particularly affected by changes in office usage patterns since the pandemic, now has a sublease availability rate approaching 6%.
The sublease wave has crashed across various markets with no clear pattern as to size. While secondary markets have generally weathered the past three years better than gateway cities in terms of office vacancy and net absorption, they have not escaped this particular indicator of softening tenant demand. With a few exceptions, such as Miami, Las Vegas and California's Inland Empire, sublease levels have been meaningful enough in most markets to weigh on rental growth, even as they portend a higher ceiling on vacancy.
Surging Across Both Downtowns and Suburbs
Just as markets of all sizes have generally seen similarly large increases in office sublease inventory, so too have downtown and suburban areas—at least in the aggregate. Central business districts and other urban areas have historically seen a higher sublease availability rate, which stands to reason as they also tend to have a greater share of large blocks of market-leading space. For this and similar reasons, urban core areas bore the brunt as tenants vacated space in 2020 and 2021, while the suburbs initially proved more resilient.
But the spring tide of sublease inventory has flooded into the suburbs as well, signifying a general decline in demand that appears to reflect more than a changing preference for location. Suburban offices, too, find themselves in a new competitive environment.
New Buildings Not Immune
One recessionary trend that has proven reliable in the post-pandemic era is the flight to quality. This is clearly visible in the stability of demand for space at newer-vintage buildings. While tenants have fled more than 300 million square feet in older-vintage buildings since 2019, net absorption has been positive in each of the past three years at buildings delivered in 2015 or later.
Yet the post-COVID sublease surge shows that even newer, high-quality office buildings are far from bulletproof. Among four- and five-star buildings—those at the top of the quality scale—sublease availability is now well over 4% at both newer- and older-vintage properties. Furthermore, it has increased at a similar rate for both.
This is a pointed reminder that the long-term implications of the pandemic are still playing out, even as the prospect of a new recession clouds the horizon. Such a recession could alter the balance of power in the labor market, and it is possible that this could lead to increased office utilization by motivating employees to come in more frequently.
But any impact on office demand would take time to occur, and the associated job losses from a recession would do little to stimulate office demand in the short term. With a tidal wave of sublease inventory already washing through the market, the bottom may be further out than it appeared a year ago. In any case, the office sector looks to be facing a slow road to recovery.
Could more than 1B square feet of US office space become obsolete?
Ashley Fahey Editor, The National Observer: Real Estate Edition
As much as 1.4 billion square feet of U.S. office space could become functionally obsolete by the end of the decade.
That's according to a new analysis by Cushman & Wakefield PLC (NYSE: CWK), which examined which categories of office space could become outdated in the coming years. When factoring in the national office market's natural vacancy — 13% before the pandemic — the decade could end with 330 million square feet of excessive vacant office space, according to Cushman.
Unsurprisingly, it's expected obsolete space will be largely contained within older office buildings that aren't renovated, sustainable or in desirable locations for today's office tenants.
Another analysis by CoStar Group Inc. (Nasdaq: CSGP), per a request by The Business Journals, found about 20,000 office buildings completed before 2014 are at least 25% vacant and comprise about 1.1 billion square feet, or about 13.4%, of total inventory nationally. That type of space accounts for 54.2% of the 580 million-plus square feet currently vacant nationally, signaling it's fallen out of favor with tenants making real estate decisions in the wake of pandemic-induced hybrid work trends and a rockier economy.
Abby Corbett, global head of investor insights at Cushman, said despite the growing obsolescence of some office space, there's potential opportunity for office buildings at risk of becoming irrelevant to be reimagined once the economy strengthens.
"The relationship between office employment growth and office demand is going to re-solidify and strengthen in the coming era," Corbett said. "It's going to get worse before it gets better."
While conversions into residential, medical office or labs have become a trendy solution to deal with the growing glut of office space nationally, it's a challenging design, engineering and financial feat to get those projects across the finish line.
Full story: https://tinyurl.com/4snzywhk
Friday, February 24, 2023
Thursday, February 23, 2023
Wednesday, February 22, 2023
Tuesday, February 21, 2023
South Jersey shopping center sells for $36.5M; developer buys Fishtown site with plans for 7-story project
Paul Schwedelson Reporter - Philadelphia Business Journal
The View at Marlton, a shopping center in Marlton, New Jersey, sold for $36.5 million.
A roundup of recent real estate transactions across the Philadelphia region:
$36.5 million
A Philadelphia-based partnership between Abrams Realty & Development and Lazgor Co. sold The View at Marlton for $36.5 million to Lakewood, New Jersey-based Paramount Realty Services as part of a 1031 exchange.
The 91,000-square-foot Marlton, New Jersey shopping center was built in 2017 and is 98% occupied. Tenants include LA Fitness, AAA, Truist Financial Corp., Dunkin’ Donuts, several beauty tenants and more.
$4.6 million
Lifelong Commercial Real Estate bought a 4,460-square-foot Wawa store at 949 Montgomery Ave. in Narberth from a national real estate investment trust for $4.6 million. The property is near the intersection of Montgomery Avenue and Old Gulph Road.
$4.2 million
Velocity Venture Partners sold a 48,000-square-foot industrial building at 436 Commerce Lane in West Berlin, New Jersey, to an undisclosed buyer for $4.2 million. Velocity bought the property in August 2020 for $2.7 million.
The building is fully occupied by site investigation contractor Conetec, drywall contractor P&B Partitions, Walmart, and Closet & Storage Concepts.
$2.175 million
A private group sold the property at 130 W. Girard Ave. in Fishtown for $2.175 million to Philadelphia-based High Top Development, which plans to build a seven-story, 84-unit building on the site.
The triangular-shaped property is on the southwest corner of West Girard Avenue and North Howard Street on the border of Fishtown and Northern Liberties. It was previously a Truist bank branch and was marketed as a development opportunity.
Friday, February 17, 2023
Court Street Ventures Completes Last-Mile Delivery Facility in Philadelphia's I-95 Corridor
By Taylor Collins CoStar Research
Court Street Ventures, a New Jersey real estate firm founded in 2020 by Evan Kleppe, has completed construction on a new 381,200-square-foot, last-mile urban distribution center on the site of the former Crown Cork & Seal manufacturing site in Philadelphia at 956 E. Erie Ave.
Developed as a joint venture between Court Street Ventures and Walton Street Capital, a Chicago-based real estate investment firm, the Crown 95 Logistics Center includes 3.5 acres of secure, off-street parking, 36' clear ceiling heights and parking for 199 cars and 104 trailers located less than 1.5 miles from I-95 within a Keystone Opportunity Zone, offering tax incentives through 2028.
Tuesday, February 14, 2023
PREIT sells Plymouth Meeting Whole Foods site for $27 million
Paul Schwedelson Reporter - Philadelphia Business Journal
The Whole Foods Market at Plymouth Meeting Mall.
PREIT has sold a Whole Foods-leased parcel at Plymouth Meeting Mall for $27 million, part of the Philadelphia real estate investment trust's ongoing plan to raise capital.
The buyer was Agree Realty (NYSE: ADC), a REIT based in Bloomfield Hills, Michigan.
Since the beginning of 2022, PREIT has sold assets generating $141 million. Asset sales and excess cash from operations went toward paying down $184 million in debt in 2022.
Philadelphia-based PREIT (OTCMKTS: PRET) reported a net loss of $71.3 million in the third quarter of 2022 and was delisted from the New York Stock Exchange in December. The company has said it will explore its options, including positioning itself to become more attractive to another company for a potential merger.
The 65,000-square-foot Whole Foods at the Plymouth Meeting Mall opened in 2010 and the grocer has a long-term lease on the property. PREIT will continue to own the rest of the mall outside of the Whole Foods site at 500 W. Germantonwn Pike.
Agree Realty owns and operates 1,839 properties in all 48 states, containing about 38 million square feet of gross leasable space, as of December. Agree owns more than 50 properties in New Jersey and about 75 properties in Pennsylvania. The properties include a variety of retail stores like Dollar General, Home Depot, AutoZone and stores with smaller footprints like CVS and Wawa.
Full story: https://tinyurl.com/bdzhm629
Monday, February 13, 2023
Friday, February 10, 2023
Thursday, February 9, 2023
Rockefeller Group Trades South New Jersey Warehouse for $83 Million to Expanding Food Firm
By Linda Moss CoStar News
Rockefeller Group has sold a recently completed 345,600-square-foot distribution center in the southern part of New Jersey for $83 million, as industrial projects continue to make their way out of the densely developed northern area of the Garden State.
New York-based Rockefeller on Wednesday said Glendale Warehouse and Distribution Corp. had acquired the Rockefeller Group Logistics Center at 2575 Route 206 in Eastampton. The industrial facility is located on roughly 28 acres about 8 miles from Exit 7 of the New Jersey Turnpike. Rockefeller Group purchased the property in September 2021. The buyer, a growing company, is consolidating some of its operations from Edison, New Jersey.
The new Class A distribution center is in one of New Jersey’s fastest-growing industrial markets, Burlington County, according to Zac Csik, vice president of Rockefeller New Jersey-Pennsylvania development. The complex "drew significant interest from both local and national users during the construction of the core and shell," he said in a statement.
New Jersey is one of the most in-demand markets for industrial users, because of its proximity to major airports and seaports and its location in a highly populated region. But industrial space is extremely tight in North Jersey, with record-low vacancy rates and little open land left to build on. So for several years now real estate firms have increasingly been buying parcels and building warehouse father and farther south. They have clustered those distribution centers along the turnpike.
Glendale will use its newly acquired warehouse to distribute spices and other food products, according to Rockefeller. The distribution center includes 96 trailer spaces, 384 auto-parking spaces and a 185-foot truck court with a 60-foot concrete apron. The property also features 54 dock doors with two drive-in doors, 36-foot-clear ceiling heights, 4,000 square feet of speculative office space and 3,000 amps of power.
Glendale is expanding its business in New Jersey, according to the company's president, Frank Collette.
“With this new facility, developed by a terrific partner in Rockefeller Group, we are consolidating operations from multiple buildings in Edison to this larger building and will be able to better serve our customers and utilize multiple ports of entry for our imported products,” he said in a statement.
Glendale will employ about 30 workers at the new facility, many of whom are coming over from its sites in Edison, according to Rockefeller.
Wednesday, February 8, 2023
Monday, February 6, 2023
Friday, February 3, 2023
Thursday, February 2, 2023
Jefferson Apartment Group & CP Capital Purchase 14-acres in Fort Washington, PA
By David Hoffman Globest.com
Jefferson Apartment Group (JAG) and equity partner CP Capital have purchased 14-acres in Fort Washington, PA, a suburb of Philadelphia, to build a luxury apartment complex.
The community, located at 1125 Virginia Drive, will be comprised of 310 units across three five-story mid-rise buildings. A pedestrian promenade will connect the buildings, which will be situated among eight acres of open space. The promenade will also connect directly to Fort Washington walking and biking trails and provide access to adjacent retail.
The project will have 12,000 square feet of interior amenity space including a grand clubroom with a bar, lounge and double-sided fireplace; game area with billiards, shuffleboard, and pinball; poker room; leading-edge fitness center; resident movie theater; private dining room; and co-working area with micro-offices.
In addition, outdoor amenities will feature a resort-style courtyard area with swimming pool, grilling stations, fire pits, and abundant lounge areas. JAG is also debuting its first pickleball courts at this new community. There are also plans for a large dog park, along with two pocket parks across the property. The site will feature surface parking, garage parking options, and EV charging stations.
The project is expected to break ground in February 2023 with delivery in late 2024.
Tuesday, January 31, 2023
Monday, January 30, 2023
D2 Capital Advisors explores conversion of Collegeville office building after refinancing
By Paul Schwedelson – Reporter, Philadelphia Business Journal
Owner D2 Capital Advisors is exploring new uses for 1000 Campus Drive, a four-story office building in Collegeville.
With uncertainty facing the office market, D2 Capital Advisors is keeping all options open for its vacant four-story, 81,400-square-foot office building in Collegeville.
D2 recently arranged an $8.5 million refinancing of the property, giving the company flexibility for a potential conversion of the building.
David Frankel, D2's chief operating officer, said the simplest option would be to continue with office space, but the building has sat vacant for the past two years. The property could be converted for life sciences, residential, self storage or other uses.
“We’re talking to different groups that have interest in it,” Frankel said. “We’re exploring what those options are.”
D2 Capital Advisors bought the building at 1000 Campus Drive in 2017 for $13.3 million. The building was fully leased at the time to Iron Mountain, a Boston-based information management company that had occupied the space since 1999. In late 2020, Iron Mountain (NYSE: IRM) struck a deal with D2 to leave the building despite having several years left on the lease. Iron Mountain moved to Royersford, consolidating its operations and leaving the building empty.
D2, headquartered in East Norriton, initially marketed the building to tenants and prospective buyers, but the effects of the Covid-19 pandemic and resulting rise of remote work eroded demand for office space dramatically.
Frankel and D2 Capital Advisors Vice President Jack Cortese secured refinancing of the property through TriState Capital Bank. Besides refinancing acquisition debt, the loan will be used to pay for improvements to the building. Cortese said securing the loan gives D2 an advantage over competitors that may be marketing conversion opportunities because the money is already in place rather than needing to line it up later on.
Full story: https://tinyurl.com/yck8kw7r
Investment firm acquires 8 PJW Restaurant Group properties, including 6 P.J. Whelihan’s locations, for $34.78M
Emma Dooling Reporter - Philadelphia Business Journal
P.J. Whelihan's Pub and Restaurant at 396 S. Lenola Road in Maple Shade, N.J.
A Princeton real estate investment firm has acquired at least eight properties housing P.J. Whelihan’s restaurants and other concepts from the hospitality group behind the popular eatery for a total of $34.78 million, according to New Jersey and Pennsylvania property records.
Essential Properties Realty Trust (NYSE: EPRT) bought the properties over the last four months of 2022. Each location is a single-tenant, standalone building, the kind of property that the investment firm typically looks to acquire and manage.
PJW Restaurant Group is the entity behind P.J. Whelihan’s Pub and Restaurant and five other concepts: The Pour House, The ChopHouse, ChopHouse Grille, Central Taco and Tequila, and Treno Pizza Bar. The South Jersey hospitality group was founded in 1983 by Bob and Donna Platzer and is based in Westmont. It employs more than 1,800 people.
In December 2021, New York City investment firm Garnett Station Partners acquired PJW Restaurant Group for an undisclosed amount. The firm’s portfolio includes similar concepts, with equity investments in Fat Tuesday and Primanti Bros. Restaurant and Bar, and credit investments in Checkers and Out West Restaurant Group Inc., an affiliate of Outback Steakhouse.
Dan Gagnier, a spokesperson for Garnett Station Partners and PJW Restaurant Group, said the sale of the real estate does not include the businesses themselves and will not impact restaurant operations.
Essential Properties did not respond to a request for comment.
Property records from New Jersey and Lehigh County, Pennsylvania, show that Essential Properties purchased the P.J. Whelihan’s locations at 425 Hurffville-Cross Keys Road in Washington Township, New Jersey, for $6.5 million; 4595 Broadway in Allentown for $2.6 million; and 1658 Hausman Road in Allentown for $1.32 million in September.
In November, Essential Properties purchased two more P.J. Whelihan’s locations in Maple Shade and Medford, New Jersey, for $6.15 million and $4.51 million, respectively. The firm also acquired the brand's Cherry Hill outpost at 1854 Route 70 E. for $5.15 million, although the date of the sale is unknown.
Full story: https://tinyurl.com/yckn5fhp
Thursday, January 26, 2023
Wednesday, January 25, 2023
Tuesday, January 24, 2023
Brandywine lists five-building Plymouth Meeting Executive Campus for sale
Paul Schwedelson Reporter - Philadelphia Business Journal
The office building at 630 W. Germantown Pike in Plymouth Meeting is one of five buildings in the Plymouth Meeting Executive Campus that's up for sale.
Brandywine Realty Trust has listed its five-building Plymouth Meeting Executive Campus for sale with some in the industry estimating it could sell for more than $100 million.
The five office buildings total 521,288 square feet. Four of the buildings have four floors and the fifth stands at six floors.
The property could sell for over $200 per square foot, according to an industry source, a figure that would equate to more than $104.3 million.
Spanning 22 acres, the Plymouth Meeting Executive Campus was built between the mid-1980s and early 90s.
Philadelphia-based Brandywine (NYSE: BDN) bought four of the buildings in 2002 for $67.2 million, according to filings with the U.S. Securities and Exchange Commission. It bought the fifth, at 660 W. Germantown Pike, in 2012 for $9.1 million. That building has six floors rather than four.
The five buildings are:
600 W. Germantown Pike: 89,626 square feet;
610 W. Germantown Pike: 90,088 square feet;
620 W. Germantown Pike: 90,183 square feet;
630 W. Germantown Pike: 89,870 square feet; and,
660 W. Germantown Pike: 161,521 square feet
Full story: https://tinyurl.com/2r5ubejc
Monday, January 23, 2023
Thursday, January 19, 2023
Campbell Soup To Relocate Offices From NC & CT to NJ HQ
By Linda Moss CoStar News
Campbell Soup Co. plans to invest roughly $50 million in its Camden, New Jersey, headquarters as it consolidates and brings its snack-business operations in North Carolina and Connecticut to its corporate campus.
Campbell, based at 1 Camden Place, on Wednesday said it is looking to relocate 330 jobs from its snack offices in Charlotte and Norwalk and close those buildings. Then, over the next three years, the company aims to update and renovate its Camden site so it can accommodate the more than 1,600 employees who will end up being located at the campus. Local media reported that the Norwalk closing will be the shuttering of Pepperidge Farm's headquarters at 595 Westport Ave.
Campbell said it campus upgrade "will create a contemporary work environment that fosters connectivity and faster decision making" in a project that includes upgrading existing space and constructing new buildings, including a new research and development center and pilot plant. Capmbell is looking "to enhance work spaces, meeting and multi-purpose rooms, and communal spaces to support a wide variety of work styles," it said.
Those adaptable work spaces will be complemented amenities such as on-site day care, a cafe, a complimentary health-and-fitness center and other services, according to Campbell. Construction is expected to start in March.
The consolidation is a win for the Garden State and Gov. Phil Murphy. New Jersey saw an exodus of corporate headquarters and operations a few years back, and Murphy's administration has been trying to keep businesses in place or lure new ones with financial carrots such as a revamped state tax incentive program. Campbell's expansion is also a boost for Camden, a city plagued by crime, poverty and other urban issues.
“Campbell is an iconic New Jersey company, and I’m pleased with their commitment to invest and grow in our state,” Murphy said in a statement. “This plan will create jobs, stimulate economic development, and strengthen Campbell’s roots in Camden where their efforts have played an essential role in the continued transformation of the city.”
Consolidation, Cost Savings
The company said it expects to realize cost savings from consolidating the snack buildings beginning in fiscal year 2024 and to reach $10 million in annual cost savings by fiscal year 2026. The savings will be partially reinvested in the business and are included in the company’s plan to increase margins in the snacks division, according to Campbell.
No commercial roles are being eliminated due to the closing of the Charlotte and Norwalk office buildings, and Campbell said it will provide eligible employees with comprehensive relocation support.
Campbell has called Camden its home for more than 150 years, since 1869, according to President and CEO Mark Clouse.
“We remain committed to our two-division operating model and are confident that being together in one headquarters is the best way for us to continue building a culture that unlocks our full growth potential," he said in a statement. "This investment will ensure Campbell remains a great place to work and a compelling destination for top talent.”
Campbell has been evaluating plans to unify its snacks' headquarters following the acquisition of Snyder’s-Lance, a maker of salty snacks like pretzels, in 2018. At that time, Campbell merged Synder's-Lance with its Pepperidge Farm unit to create what it called "a unified snacking organization in the U.S. called Campbell Snacks." The division currently operates across multiple office locations, mainly split between Camden, Charlotte and Norwalk, according to Campbell. The Charlotte office building has 104,368 square feet, according to CoStar data.
Investing in Camden Campus
Campbell said it determined that investing in Camden and unifying most of the company’s office-based employees in one location "provides the greatest benefits for the business and will provide the snacks division with significantly improved facilities, resources and services than those that exist in Charlotte or Norwalk.
Employees in Charlotte and Norwalk will relocate to Camden in phases starting in mid-2023. For employees who choose not to relocate, Campbell will provide job placement support and severance-benefits commensurate with level and years of service.
The snacks building closings will not impact Campbell’s other operations in Connecticut and North Carolina. In Connecticut, Campbell will continue to operate its Pepperidge Farm bakery in Bloomfield. Opened in 2002, the bakery employs nearly 400 people, is actively hiring and has plans to expand this year.
In North Carolina, in Charlotte Campbell will remain a manufacturing and distribution center, with about 1,400 employees in the Pineville area. Combined with the company’s Maxton manufacturing site, Campbell employs roughly 2,500 people in the state.
“We have a long history in Connecticut and North Carolina and will continue to have key operations in both states,” Clouse said. “The decision to close these offices was difficult but it is the right thing to do for our business and culture. Unifying the company in one headquarters increases connectivity, collaboration and provides enhanced career opportunities for our team.”
Campbell has been at its current spot in Camden since 1957, when the corporate headquarters was moved roughly one mile from its original manufacturing plant. The company last completed a major expansion and renovation of its campus in 2010 at a cost of roughly $132 million. At that time, Campbell also purchased vacant buildings and parcels surrounding its headquarters, which spurred the redevelopment of Camden’s Gateway District and the location of other major businesses to the city, including Subaru of America.
Wednesday, January 18, 2023
Tuesday, January 17, 2023
Major Student Housing Developer Plans Second Project Near Drexel University in Philadelphia
By Richard Lawson CoStar News
One of the nation’s largest student housing developers and investors plans to build its second project near two Philadelphia universities.
Landmark Properties announced Thursday that a new 363-unit tower called The Mark will rise 34 stories within a few blocks of the University of Pennsylvania, an Ivy League school, and Drexel University.
The project also includes 55,938 square feet of existing historic office space next to the tower. Renderings provided by the developer appear to show the tower rising next to The Ralston House, a building constructed in the 1880s as a home for indigent, elderly women, according to documents on file with the city of Philadelphia. The University of Pennsylvania currently uses The Ralston House as office space.
The Athens, Georgia-based firm is well underway on construction of The Standard at Philadelphia, a 280-unit property a short distance from The Mark. The Standard is scheduled to open this fall with The Mark following in 2026.
Last year was a record year for Landmark. It did $4.7 billion in transactions to bring assets under management to $10.4 billion, the most in the company’s 20-year history. The firm also struck two deals with the Abu Dhabi Investment Authority, a sovereign wealth fund that invests on the Middle Eastern country's behalf, totaling $3 billion to buy properties and build new ones. Landmark closed out the year teaming up with Canadian investor Manulife Investment Management to build student housing, starting with a development near the University of Connecticut.
Monday, January 16, 2023
Friday, January 13, 2023
Wednesday, January 11, 2023
Apartment Owners Face Increased Lease-Up Competition As Apartment Development Ramps Up in and Around Center City Philadelphia
The record-breaking supply surge will temporarily outpace renter demand during this cycle. Subsequently, marketing efforts aimed at a more constrained renter pool have already ramped up in these neighborhoods, and lease-up competition will likely continue through mid-2024. If overall macro environment confidence improves near-term, the springtime may unlock pent-up renter demand. However, this supply wave will still moderately exceed even the highest demand levels seen throughout the golden period between late 2020 and early 2022. As vacancy trends upward alongside the wave of new additions, daily asking rent growth is expected to moderate, while concessions will become more widespread throughout 2023.
A review of Apartments.com listings indicates that concessions have returned in early 2023. Nearly half of the top properties in each area offer some form of concession, from a $500 move-in credit to a generous two months of free rent plus a $1,000 move-in credit for city, education and health professionals. Several stabilized properties with occupancy above 90% are even offering concessions.
As renters digest recent rent surges, landlords will need to re-evaluate what 2023 rental rates are competitive to lease up individual developments in a sea of high-end options for renters. Across three-star properties in these five areas, vacancy is 6.5%. Meanwhile, across four- and five-star properties, vacancy is already at 10% and is expected to increase in the near term with the large number of new deliveries. While rent differentials may fluctuate drastically across individual properties, the average market rent differential between three-star and four- and five-star properties is $445 per month for studio units, $540 per month for one-bedroom, and $860 per month for two-bedroom units in these five areas.
In 2023, four- and five-star multifamily owners will need to prepare for the heavy competition ahead, but there should be a reprieve by late 2024 from a significant slowdown in new large-scale supply entering the market. Until then, property owners should focus on renter retention as much as renter attraction to maintain a well-occupied, competitive development.
