Friday, May 30, 2025
Wednesday, May 28, 2025
Mega-warehouse lease is Philadelphia region's largest so far this year
By Paul Schwedelson – Reporter, Philadelphia Business Journal
Logistics firm Performance Team has signed a lease to occupy the entire 1.2 million-square-foot Box Park Logistics Center in Cinnaminson, according to industry sources, marking the largest industrial lease in the Philadelphia region this year.
The deal — two years after developer Logistics Property Co. completed the building — takes a big chunk of vacant space off the market.
California-based Performance Team was acquired by Denmark-based ocean shipping giant Maersk in 2020 for $545 million.
Box Park Logistics Center is at 995 Taylors Lane in Cinnaminson off of Route 130 and nine miles from the Port of Philadelphia. The South Jersey building has 40-foot clear height, 216 dock doors, four drive-in doors, 549 car parking spots and 216 trailer parking spots.
At 1.2 million square feet, the building ranks among the largest warehouse distribution centers in the Philadelphia region. The property also has room for the building to potentially expand up to an additional 300,000 square feet.
“This project, in size alone, was a tremendous undertaking,” Logistics Property Co. Northeast Region Senior Vice President Mark Glagola said in a statement.
Performance Team did not immediately provide comment on Tuesday.
Chicago-based Logistics Property Co. has been active in the Philadelphia region and has nearly completed the South Penn Logistics Center, a 973,000-square-foot development in Bucks County’s Morrisville, approximately 20 miles over the Delaware River from Box Park Logistics Center.
In 2023, Logistics Property Co. signed chemical giant DuPont as a tenant at the 385,000-square-foot First State Logistics Park in Newark, Delaware.
The 1.2 million-square-foot lease bucks the emerging trend in Philadelphia’s industrial market that tenants are typically looking for smaller spaces often less than 200,000 square feet in a post-pandemic world.
After Philadelphia’s industrial market reached record-low vacancy around 2% to 3% in 2022, the vacancy rate has been steadily rising since then. To respond to the e-commerce boom and address the need for warehouse distribution space, developers rushed to build more supply.
With that new supply being completed around the same time, industry insiders are closely monitoring how that space is absorbed before they consider moving ahead with future projects.
Full story: http://tiny.cc/wz9l001
Local PA developer acquires another Amazon warehouse in FLA as part of $55M deal
By Brian Bandell – Real Estate Editor, Philadelphia Business Journal
Radnor's EQT Real Estate has made another acquisition involving an Amazon.com-leased warehouse.
The real estate investment firm purchased a pair of South Florida warehouses, located in Deerfield Beach and Pompano Beach, for a combined $55.35 million.
The warehouse in Deerfield Beach serves as an Amazon.com delivery station.
Miami-based Elion Partners was the seller. Property data firm Vizzda confirmed the buyer was EQT Real Estate.
In the bigger deal, Elion Partners affiliate EV 1111 SW 30 LLC sold the 165,540-square-foot warehouse at 1111 S.W. 30th Ave. in Deerfield Beach for $37.95 million to Exeter 111 30th LLC. The price equated to $229 per square foot.
The Deerfield Beach warehouse last traded for $22 million in 2020, so it gained in value. It was built on the 13-acre site in 1985.
Meanwhile, Elion Partners affiliate EV 1121 LLC sold the 63,000-square-foot warehouse at 1121 N.W. 31st Ave. in Pompano Beach for $17.4 million to Exeter 1121 31st LLC. The price worked out to $276 per square foot.
Built on the 3.5-acre site in 1989, the Pompano Beach warehouse last sold for $15.25 million in 2022.
This is the third major deal in South Florida for Exeter in the past six months. In November, Exeter bought a Doral warehouse for $20.6 million. In early May, it paid $16.75 million for another Doral warehouse.
EQT Real Estate is formerly known as EQT Exeter and Exeter Property Group. Exeter Property Group was acquired in 2021 by Stockholm private equity firm EQT AB for $1.9 billion.
Full story: http://tiny.cc/5z9l001
Thursday, May 22, 2025
Tuesday, May 20, 2025
Tenants emerge as top buyers of Lehigh Valley industrial warehouse properties
By Brenda Nguyen CoStar Analytics
There's been a significant shift in the Lehigh Valley industrial market as large industrial space users and tenants increasingly opt to buy their formerly leased warehouse and distribution properties.
Recent transaction data from the first quarter reveals that building acquisitions by local users have gained substantial market share during the latest real estate down cycle, especially as institutional investors and REITs have pulled back.
This trend is a notable reversal from previous years when institutional capital dominated the industrial property acquisition market. While REITs, public companies and institutional investors moved to the sidelines amid a higher-risk environment, end-users now have less competition in pursuing property ownership.
Owner-occupant transactions have buoyed recent sales volumes by dollar, accounting for over 40% of the total industrial property sales volume, a notable surge from the 6% to 7% share of the total sales volume in 2022 and 2023.
Current market conditions have created a unique window of opportunity for tenants to become owners. Smaller companies that previously couldn't compete with deep-pocketed institutions are now finding themselves at the negotiating table with a chance to acquire their operational facilities. These owner-user sales could stay elevated as long as investors have difficulty underwriting and financing property purchases.
Monday, May 19, 2025
Wanamaker Building heads to foreclosure auction with $120 million starting bid
By Katie Burke CoStar News
After about two years of foreclosure threats, the historic Wanamaker Building in downtown Philadelphia is headed for auction.
The 114-year-old Center City office property will be up for bids as part of a Philadelphia Sheriff's Office sale in which TF Cornerstone, a New York-based investment firm and the property's primary lender, already has a $120 million head start. The auction will begin on June 3 for the roughly 1.4 million-square-foot building, which has an occupancy rate of about 20% after years of depressed demand and a string of large tenant move-outs.
Similar to other older office properties throughout Philadelphia, the Wanamaker at 100 Penn Square East has struggled to find its post-pandemic footing as companies have both shrunk their real estate footprints and prioritized space in some of the city's newer and nicer options.
The building — which is split between about 950,000 square feet of office space and a recently shuttered Macy's department store — is primarily owned by Rubenstein Partners, a locally based investment firm that paid $114 million for a 60% stake in the property in early 2017 when it was roughly 97% occupied, according to CoStar data.
Yet Rubenstein's financial troubles began to mount shortly thereafter.
In the earlier years of the pandemic, tenants including the Children's Hospital of Philadelphia, the United States Army Corps of Engineers and the federal Housing and Urban Development agency vacated about 500,000 square feet after exercising options to terminate their leases.
Rubenstein was unable to backfill the spaces, and in 2021, tried landing a buyer for the building after investing upward of $30 million in capital improvements as part of a plan to upgrade and reposition the property.
That plan fell flat, however, and a couple of years later, the $124 million loan on the Wanamaker Building fell into receivership. The servicer slashed its appraised value from $185.7 million when the loan was issued in 2018 to less than $54.5 million, equating to a roughly 72% drop.
Betting on a turnaround
While most lenders are reticent to transition into landlords, TF Cornerstone began building up its stake in the historic building when it purchased a majority of the property's debt last year. The investment firm purchased the retail portion of the Wanamaker for $40 million in late 2019, at which point the space was still fully occupied by Macy's. Since then, it has reportedly been exploring a potential residential conversion plan for the remainder of the building.
Given TF Cornerstone's credit for the auction, any interested bidder would have to submit an offer of more than $120 million in order to remain competitive.
Distressed properties have fueled Philadelphia's office sales market in recent years as the city struggles to work through a record amount of available space. Companies in the area handed back more than 7.6 million square feet between 2019 and 2023, according to CoStar data, and rents have fallen alongside the decline in tenant demand.
What's more, about 3 million square feet of leases are set to expire through the remainder of this year, an amount that could prolong the market's recovery even as large employers such as Chubb, FS Investments and Vanguard have expanded their office stakes in the region.
Even so, Philadelphia's roughly 14% availability rate is the second lowest in the country, according to the data, and the city's diverse economic base has made eager investors optimistic about a prospective rebound. Private buyers and investment firms have accounted for about 60% of the sales that have closed in the area over the past year, many of which traded at just a fraction of their previous prices.
Thursday, May 15, 2025
Philadelphia’s medical office sector experiencing hiccups in early 2025
By Brenda Nguyen CoStar Analytics
Medical offices have outperformed traditional office space in Philadelphia's commercial real estate market, though signs of deceleration have begun to emerge in early 2025.
Annual absorption, the net change in occupied space, contracted to 49,000 square feet in the first quarter of 2025, down from 185,000 square feet in the previous quarter. Although still quite healthy, Philadelphia’s medical office vacancy ticked up to 8.3%, rising 30 basis points from its seven-year low at the end of 2024.
Philadelphia's nationally recognized healthcare anchors—the University of Pennsylvania, Thomas Jefferson Health, and Children's Hospital of Philadelphia—have historically proven to be a stable base for Philadelphia's office sector, even during downturns. These institutions were behind several of the region’s largest medical office leases and acquisitions in recent years.
However, recent funding cuts at the National Institutes of Health, the federal medical research agency that funds much of the medical research conducted at universities, may weaken this foundation.
Greater Philadelphia secured $1.4 billion in NIH funding in 2023, ranking sixth nationally among 18 markets. Imminent funding cuts could indirectly impact medical office demand, as these buildings often benefit from healthcare research activities.
Beyond healthcare institutions, other organizations, such as the University City Science Center—a 50-year-old nonprofit supporting healthcare and life sciences startups—may also feel the effects of reduced NIH support.
Amid slowing demand, medical office rent growth has decelerated from an annual average of 1.4% at year-end to just 0.6% at the end of March.
With job growth expected to slow throughout 2025, demand for new medical office space may further weaken. Nevertheless, due to healthcare's essential nature and the region's strong institutional presence, the sector should maintain its relative resilience compared to traditional office space.
Tuesday, May 13, 2025
GMB North America, Global auto parts maker, revs up deal to relocate HQ to new Burlington warehouse
By Lauren Sutton CoStar Research
GMB North America, a subsidiary of global auto parts manufacturer GMB, struck a deal to relocate its headquarters and North America distribution operation from Middlesex County to a new, 294,000-square-foot industrial building Crow Holdings Development is finishing at 1804 River Road in Burlington, New Jersey.
GMB signed a 156,000-square-foot lease in the new warehouse development descriptively dubbed Crow Holdings at Exit 6A.
Japan-based GMB is one of the largest global original equipment and aftermarket automotive components manufacturers. The Crow Holdings Development team led by Brad Vander Vliet and Connor Jaeger.
The new warehouse offers access to several ground transportation arteries from Exit 6, including the New Jersey and Pennsylvania turnpikes. The Keystone Industrial Port complex is less than 30 minutes away; Philadelphia Airport, the Ports of Camden and Philadelphia are all within a 45-minute drive; and Newark Liberty International Airport and the Port of New York/New Jersey can be reached within one hour.
Crow Holdings Development’s Northeast region has been especially active. Its latest projects include the recently completed Crow Holdings at Carteret in Carteret, New Jersey, with another project, the Golden Triangle Logistics Center in Wallkill, New York, under development. According to the firm, it has built more than 4.2 million square feet of new industrial space since 2020 and currently has 1 million square feet of construction in progress across New Jersey, New York and Pennsylvania.
Crow Holdings Development is the development platform of Crow Holdings, a privately owned real estate investment and development firm with $33 billion of assets under management. The company specializes in multifamily and industrial development with a newly launched office development platform.
Monday, May 12, 2025
Philadelphia Industrial Market Faces Mounting Headwinds as Vacancy Rates Climb
By Anthony Russo Globest.com
There aren't many encouraging signs for Philadelphia's industrial sector; almost every core fundamental, from supply to demand, is heading in the wrong direction.
Starting with overall vacancy, the rate spiked by 140 basis points year-over-year in the first quarter to 9.4 percent.
"Southern NJ’s vacancy rate, at 11.6%, remained in the double digits for the sixth consecutive quarter, with vacancy concentrated around Salem County (37.6%) and Burlington County (11.0%)," the firm wrote in further context.
Also, Southern Pennsylvania's performance was weak, with vacancy in the region hitting 8.6 percent, a 180-basis-point increase from the 12 months prior.
Net absorption, while positive at 1.8 million square feet, declined by 800,000 square feet. Demand was particularly soft in Southeastern Pennsylvania, where -390,684 square feet were absorbed.
Construction deliveries surged by 86 percent to 3.9 million square feet.
The one positive is that asking rental rates have advanced to $12.09 per square foot. However, that's just a one-cent increase from the 12 months prior, and it doesn't exactly induce a champagne gathering. Also, rents are down 1.5 percent from the previous three months. But in more encouraging news, projects that the category will "remain elevated with developer loan obligations creating a floor for discounts."
Deliveries might slow down as soft demand and high interest rates could force developers to forgo groundbreakings over the next year.
However, the CRE firm sees plenty of more turbulence in the Philadelphia industrial sector, as the tariff policy from the Trump administration won't help bring down vacancy rates. It notes that "reshoring will take years to take effect." Additionally, leasing will take longer for larger properties exceeding one million square feet because tenants prefer occupying space in the 250,000 to 450,000 square foot range.
The top lease in the first quarter went to JD Logistics' 400,950 square foot deal in Southern, NJ. RefrescoBeverages US, and Printed Solid followed with their 247,401 square feet and 95,673 square feet deals, respectively, in the metro.
Wednesday, May 7, 2025
Pennsylvania invests $30M into Navy Yard redevelopment
By Paul Schwedelson – Reporter, Philadelphia Business Journal
The Commonwealth of Pennsylvania is awarding a $30 million grant for the Philadelphia Navy Yard to create shovel-ready sites in an effort to attract businesses to the development.
The Navy Yard developers, joint venture partners Ensemble Investments and Mosaic Development Partners, are set to use the state funding for a 54-acre section of the South Philadelphia property. The land will be prepared for six lots to support 500,000 to 700,000 square feet of new advanced manufacturing and commercial space, according to Tuesday's funding announcement from Gov. Josh Shapiro.
The funding will support roadway and utilities work, soil excavation, grading and stormwater management as the Navy Yard continues to emerge as a life sciences, research and manufacturing hub.
"This investment accelerates our shared vision to create pad-ready sites to continue to attract top-tier businesses and position Philadelphia as a national hub for advanced industries," said Mark Seltzer, managing director of Ensemble, in a statement to the Business Journal.
The Navy Yard is one of 11 projects across the state that will collectively receive $64 million through the first round of grants from the Pennsylvania Strategic Investments to Enhance Sites (PA SITES) program, according to Shapiro and Department of Community and Economic Development Secretary Rick Siger.
The Ensemble/Mosaic joint venture is in the middle of a $6 billion master plan to redevelop 109 acres at the Navy Yard. Philadelphia Industrial Development Corp. awarded development rights to Ensemble/Mosaic in 2020.
The plan calls for 9 million square feet of space to be built, expected to result in 12,000 new jobs. The redevelopment project includes lab and manufacturing space for life sciences companies, 4,000 new apartments and 235,000 square feet of retail space.
Full story: http://tiny.cc/f50j001
Gemma Services school plans new $52M campus for MLK Behavioral Health School
By Ryan Mulligan – Reporter, Philadelphia Business Journal
Nonprofit Gemma Services is turning the former Plymouth Meeting headquarters of a medical device research firm into a new campus for its Martin Luther School.
The private K-12 school for students who need emotional and behavioral support will move from its current campus at 512 W. Township Line Road in Plymouth Meeting to the more than 20-acre property at 5200 Butler Pike come 2026.
The project will cost an estimated $52 million, said Gemma Services CEO Kristen Gay. It will see the organization convert the 80,000-square-foot former home base of nonprofit ECRI into over 30 classrooms while building an addition for elective learning spaces with a black box theater, a gymnasium and a library. Across the campus, the nonprofit is also looking to add outdoor learning space, multiple playgrounds and a track and sports field with stands if municipal funding is secured.
Gemma Services acquired the property for nearly $14 million in December from ECRI, Montgomery County property records show.
The organization is funding the project through a recently launched $3 million capital campaign, a loan, potential municipal funding and a significant grant from the Gemma Foundation, an independent entity that helps fund the nonprofit's operations. Over half of the $3 million goal was raised through a silent phase of the campaign, announced last week week.
Gemma Services was formed in 2019 by the merger of behavioral health nonprofits Silver Springs and the Village, both of which had roots dating back to the 1800s in Philadelphia.
Martin Luther School is a private K-12 school that gives students an individualized learning program. The current West Township Line Road property spans multiple buildings across 37 acres. Martin Luther School began incrementally adding high school grades in recent years and will graduate its first high school class this year. It has a student population of 230, pulling students from some 40 local school districts. Gay says the new campus will help the school expand to over 350 students in the coming years.
Full story: http://tiny.cc/x20j001
Monday, May 5, 2025
Thursday, May 1, 2025
Top property sales recognized for Philadelphia
By CoStar Research
As big-ticket items involving sizable investments, commercial property transactions often have a wider impact within the local community. CoStar is pleased to recognize the following top deals completed during the first quarter in their respective markets.
TOP SALE: The Point at Berwyn, 400 W. Swedesford Road, Berwyn, PA
Sale Price: $96,500,000
Sale Date: February 25, 2025
Size: 295,648 SF
Buyer: Pantzer Properties, New York, NY
Seller: The Bozzuto Group, Greenbelt, MD
Deal Commentary: This 250-unit Berwyn apartment complex, built in 2023, traded to New York-based Pantzer Properties in a top first-quarter deal. The property has since been renamed The Point at Berwyn.
TOP SALE: Apartments at Glenmoore, 900 Selwyn Place, Glenmoore, PA
Sale Price: $58,000,000
Sale Date: February 19, 2025
Size: 284,792 SF
Buyer: Berger Communities, Wayne, PA
Seller: FPA Multifamily, San Francisco, CA
Deal Commentary: FPA Multifamily, a San Francisco-based private equity firm that had owned this 216-unit apartment complex in Glenmoore, Pennsylvania, since 2018, sold the garden-style community to a local firm, Berger Communities, for $58 million in the first quarter.
TOP SALE: Exton Square Mall, 260 Exton Square Parkway, Exton, PA
Sale Price: $34,250,000
Sale Date: March 18, 2025
Size: 992,071 SF
Buyer: Abrams Realty & Development, Elkins Park, PA
Seller: PREIT, Philadelphia, PA
Deal Commentary: Pennsylvania Real Estate Investment Trust finally parted with the nearly one million-square-foot Exton Square Mall in Exton, Pennsylvania, after putting the troubled, half-empty property back on the market following an effort to redevelop it into a mixed-use property. The buyer, Abrams Realty and Development, plans to demolish most of the 52-year-old mall and redevelop the area into over 600 apartments and townhomes with shops, entertainment, offices and other uses.
TOP SALE: 1235 Easton Road, Bethlehem, PA
Sale Price: $30,000,000
Sale Date: January 15, 2025
Size: 44,500 SF
Buyer: J. B. Hunt, Lowell, AR
Seller: J.G. Petrucci Co., Asbury, NJ
Deal Commentary: In another first-quarter deal, J.G. Petrucci Co., Inc. sold the 44,500 square foot industrial building to one of the current tenants.
TOP SALE: Barrington Mews, 2101 Reamer Drive, Barrington, NJ
Sale Price: Not disclosed
Sale Date: March 25, 2025
Size: 214,861.64 SF
Buyer: Axial Partners, Lakewood, NJ
Seller: A.A.H. Management Company, Voorhees, NJ
Deal Commentary: Axial Partners picked up this 284-unit senior housing complex in a first-quarter deal after its affordable-income restriction was lifted in 2024, and the New Jersey Housing and Mortgage Finance Agency restrictions expired in early 2025. Formerly City Horizon Group, Axial Partners is a real estate investment firm that acquired its first duplex in 2016 and has since acquired numerous apartment properties.
TOP SALE: Village Center, 2301-2389 Pasqualone Blvd., Bensalem, PA
Sale Price: $28,925,000
Sale Date: March 10, 2025
Size: 117,205 SF
Buyer: ShopOne Centers REIT, New York, NY and Pantheon, London, UK
Seller: Gaetano T. Barone, New Hope, PA
Deal Commentary: ShopOne Centers REIT Inc. and its joint venture partner Pantheon continued to add to their shopping center portfolio with the first-quarter acquisition of two open-air retail shopping centers in Pennsylvania, Goodnoe’s Corner in Newtown, and Village Center in Bensalem. Anchored by an Acme grocery store, Village Center is positioned along major commuter routes within Bucks County. It has proven to be a resilient, long-term asset, according to a statement issued by the buyers.
TOP SALE: 350 Guthrie Road, King of Prussia, PA
Sale Price: $27,436,898
Sale Date: February 6, 2025
Size: 258,581 SF
Buyer: Legend Senior Living, Wichita, KS and Welltower, Inc., Toledo, OH
Seller: Anthology Senior Living, Denver, CO
Deal Commentary: Colorado-based Anthology Senior Living sold this 190-unit senior housing complex to its joint venture partners in a top first-quarter deal. The price worked out to $144,405 per unit. Built in 2021, the 11-story facility includes a mix of independent living, assisted living, and memory care units. Following the sale, the building was renamed Revelle King of Prussia.
TOP SALE: 2709 Commerce Way, Philadelphia, PA
Sale Price: $27,200,000
Sale Date: March 19, 2025
Size: 159,265 SF
Buyer: Cabot Properties, Boston, MA
Seller: Almo, Philadelphia, PA
Deal Commentary: Almo Corp. is one of the largest U.S. distributors of appliances, consumer electronics, professional audio/video equipment and housewares. It supplies a wide range of retailers, integrators, resellers, and e-tailers nationwide. In the first quarter, it executed a sale-leaseback of its flex building in Philadelphia with Cabot Properties.
TOP SALE: Fairless Hills Shopping Center, 500-524 Lincoln Hwy., Fairless Hills, PA
Sale Price: $23,600,000
Sale Date: January 3, 2025
Size: 189,998 SF
Buyer: Ocean State Job Lot, North Kingstown, RI
Seller: The Klein Group, Florham Park, NJ
Deal Commentary: After nearly a decade of ownership, The Klein Group divested the Fairless Hills shopping center to discount closeout retail chain Ocean State Job Lot. With a $23,600,600 price point, the new owner plans to join the current occupants at some point and fill the space available at the center.
TOP SALE: Bensalem Shopping Center, 1903-1969 Street Road, Bensalem, PA
Sale Price: $20,100,000
Sale Date: February 27, 2025
Size: 109,057 SF
Buyer: Chaman Popli, Newtown, PA
Seller: Empire Realty Investments, Philadelphia, PA
Deal Commentary: The fully occupied Bensalem Shopping Center, located at the intersection of Street and Hulmeville roads in a prime retail corridor 15 miles north of Center City Philadelphia, traded hands in a first-quarter deal amid robust demand for grocery-anchored retail centers. The fully leased center is anchored by Patel Brothers, the largest Indian grocery chain in the U.S.
