Tuesday, October 8, 2024
Thursday, October 3, 2024
Wednesday, October 2, 2024
Delco warehouse trades for 41% more than it sold for two years ago
By Paul Schwedelson – Reporter, Philadelphia Business Journal
Velocity Venture Partners has sold one of the largest industrial buildings in Delaware County for $59 million, an increase of 41% from when the firm bought it two years ago.
The 468,000-square-foot warehouse at 6250 Baltimore Ave. in Yeadon was acquired by New York-based Lightstone Group, said Newmark’s Ryan Guittare, the listing agent in the sale that closed Monday. The deal is Lightstone Group's first in the Philadelphia area.
The price breaks down to $126 per square foot. The warehouse is just over the border from Philadelphia.
The property’s value increasing $17 million from the $41.75 million in paid two years ago speaks to the strength of Philadelphia’s industrial market, Velocity Founding Partner Zach Moore said. Bala Cynwyd-based Velocity spent $4 million renovating the roof, parking lot, exterior facade and other areas with significant deferred maintenance. The firm also signed about 200,000 square feet of new leases, adding to the building’s value.
“It’s obviously a great outcome for us from a sales perspective, number one,” Moore said. “But number two, I think it really shows we did a good job of identifying that infill marketplace is well in demand.”
Full story: https://tinyurl.com/tbkh9a3f
Tuesday, October 1, 2024
142-year-old Conshohocken property home to a bed and breakfast up for sale
By Emma Dooling – Reporter, Philadelphia Business Journal
A 142-year-old Montgomery County property currently home to a bed and breakfast is up for sale.
The six-bed, six-and-a-half-bath George Washington Wood Bed & Breakfast in Conshohocken is asking $3.2 million, owner Joe Rutkowski told the Business Journal.
The sale includes the three-story property along with its furnishings and the bed and breakfast business.
Rutkowski purchased the 0.19-acre property with his late wife Carol for $485,000 in early 2016. The duo spent about three years renovating the 6,100-square-foot building before opening it as the George Washington Wood Bed & Breakfast in March 2019.
Carol Rutkowski died in late 2020 following a battle with cancer. In the years since, Joe Rutkowski continued to operate the bed and breakfast, including using it as an event venue for nearby Conshohocken restaurant Brunch. The bed and breakfast shuttered over the summer.
Rutkowski said the property was his wife's "dream" and "labor of love." She grew up blocks away from the home and had told Rutkowski since they got married in 1979 that she would eventually buy the building. Without her to run the bed and breakfast with him, he has decided to offload the property.
“It was an adventure, but now it’s time to let it go,” Rutkowski said.
Located at 201 E. 5th Ave., the George Washington Wood Bed & Breakfast offers an office, a living room, a dining room, a half bath and a commercial kitchen on the first floor, according to Rutkowski. The second level offers four guest rooms, while the third floor houses a primary suite and a smaller suite.
Each of the six bedrooms has its own bathroom. The property also has a six-car parking lot in the rear.
Full story: https://tinyurl.com/5n8ctxmh
Industrial sublease space swells in Eastern Pennsylvania
By Brenda Nguyen CoStar Analytics
The eastern Pennsylvania region, which includes major areas such as Philadelphia, the Lehigh Valley, Scranton and Harrisburg, encompasses more than 1.4 billion square feet of industrial inventory representing more than 7% of the total industrial space across the United States. Its strategic location at the center of the country’s largest concentration of spending power has historically contributed to a strong overall performance.
However, over the past several quarters, the region has encountered a downturn in demand primarily attributed to a slowdown in consumer spending and elevated borrowing costs. In response, several big-box facilities have been listed for sublease. As of the third quarter, the sublet share of total available space has seen a notable increase rising from 2.3% to 11.3% in the span of two years. Struggling retailers and third-party logistics providers have been behind much of this increase in sublet availability.
Earlier this month, British fashion e-retailer BooHoo Group announced plans to close its 1.1-million-square-foot warehouse at the First Logistics Center @ 283 in Londonderry Township, Pennsylvania. This facility is expected to close by November 11.
The company’s decision to shut down its U.S. operations and fulfill orders from its automated distribution center in Sheffield, United Kingdom, suggests U.S. sales have not been as strong as expected just over a year since the company occupied the facility in 2023.
Back in May, Smuckers also listed its 1.14-million-square-foot facility in Newville, Pennsylvania for sublease. The company is open to subleasing anywhere from 525,000 square feet up to the entire facility. This listing is one of the largest sublet spaces on the market and is being marketed with an "aggressive sublease rate," according to real estate brokers.
The slowdown in home sales—currently at their lowest levels in over a decade—has also affected consumer spending on home improvement, furniture and home goods. Retailers in these segments have faced significant challenges. For example, Wisconsin-based kitchen and bath product manufacturer Kohler listed 425,000 square feet of its one-million-square-foot facility in Reading, Pennsylvania for sublease in March 2024 and Hollander Sleep & Décor put more than 350,000 square feet of its space in Pottsville on the sublet market last year.
Third-party logistics companies have not been spared from these economic pressures either. Broadrange Logistics, Returns Worldwide and All-Ways Forwarding are several logistics providers that have each listed more than 300,000 square feet for sublease in recent quarters.
As 2024 begins to draw to a close, CoStar is projecting the eastern Pennsylvania region to post the lowest level of industrial absorption for the full year—defined as the net change in occupied space—in over a decade. The first half of the year saw particularly challenging conditions, with negative absorption recorded for the first time since 2012 during the second quarter.
However, the adverse market conditions are expected to be temporary. Demand for goods is anticipated to increase throughout 2025 as the Federal Reserve has made one rate cut and indicated that lower interest rates are on the horizon.
