by Steve Lubetkin, Globest.com
Department stores will play a less-pivotal role in retail centers of the future, as sales declines lead to foot-traffic declines. The good news is that other retail uses with better traffic will replace them and improve the sales prospects for such malls over time, he says.
“Trends take time, trends just don’t happen overnight, trends often take years or even decades to play out. One would be the decline in importance of what we call traditional old-fashioned department stores as being relevant in projects.”
As sales in department stores decline, traffic also declines. “You don’t tend to have lots of traffic and no sales, and vice versa,” he says. “We see that with Macy’s announcing closings in the Philadelphia area. People lament that, but they really shouldn’t, because the traffic they were generating has been on the decline for years, and what will replace them will undoubtedly be uses that create more traffic.”
Unconventional uses like fitness, food, and medical are likely to replace department stores in many retail mall settings, Gartner says.
“An office-shared concept like we work, will in theory bring as much traffic to a property as a mundane retailer,” he says. “It’s all about being relevant in today’s world. If we look at the history of the suburban mall, it was to create a climate-controlled version of downtown. Retail real estate is one of the few parts of commercial real estate where you have to lease space and attract the public to buy stuff. Office doesn’t have to do that.”
Restaurants will continue to play a key role in the transformation of retail malls, because the restaurant experience can’t be replicated online, adding that grocery stores offering prepared foods and malls with food trucks also are becoming popular. Fitness stores are also a rising element of the tenant mix, he says.
“Having versatile real estate is important. If somebody is developing a new project, the ability to have proper venting that only restaurants need is important. That’s hard on the ground floor of a mixed-use project. These are things we give advice to owners about. A restaurant will need about double the parking of conventional retail, because a restaurant has more people in its confines than a traditional retail store at any one time.”
“Rents a holding, we’re seeing the reuse of a lot of buildings.” At Suburban Square Mall in Ardmore, PA, a former Macy’s building is being repurposed for multiple tenants, he says.
Entertainment retail, such as theaters, bowling, ping-pong, pool, golf stores, “getting people together in places and landlords liking it because it drives traffic,” will also be among the key trends, he says. Center City Philadelphia will announce tenants, projects, and deals this year, particularly in East Market and in the Gallery reimagining, Gartner says.
www.omegare.com
Wednesday, September 7, 2016
Tuesday, September 6, 2016
Accesso Partners Boosts 1515 Market’s Occupancy 10 Points
by Steve Lubetkin, Globest.com
When Accesso Partners acquired 1515 Market Street for $85 million in December 2014, it pledged to improve the 20-story, 502,000 square foot office tower that houses Temple University’s Center City campus and dozens of professional service firms.
Accesso, chosen from 100 potential buyers, kept its promise, made significant improvements and has raised occupancy from 82% to 92.3% in the past 18 months. Some 47,081 square feet of office space leases were executed in the first half of this year and leases totaling another 10,000 square feet are out for signature.
The Hallandale, FL real estate investment manager added a ninth-floor conference center as an exclusive free amenity for tenants. The lobby, elevator cabs, the underground concourse entrance leading to SEPTA, common corridors and bathrooms have been upgraded. Elevators at the property are being modernized and aesthetic changes are underway.
“Accesso is a serious owner and the first in a long time to actually make substantial investments in this building as evidenced by capital improvements already completed and planned,” says Keli Wallace, senior property manager for Accesso Services, the owner’s property management subsidiary.
Recent new tenants include Sage Acquisitions, a real estate law and asset management firm, the law firm of Steven L. Chung Esq., McMahon Engineering, GZA Geoenvironmentalists, HDR Engineers and Architects and law firm Manley Deas Kochalski. Law firms Brainard Partners and Walker Nell renewed their leases. Law firms Litchfield Cavo; O’Brien, Rulis and Bochicchio; Wade, Clark Mulcahy; Legal Search and R-T Specialty, a service provider for insurance agents and brokers, expanded their offices.
“Philadelphia has been a sharply growing and improving office market in the last four to five years. To enter and compete here, Accesso realized it would have to put the right amount of capital into the right improvements and they did exactly that.”
Various “spec suites” with stylish finishes were recently built out with one immediately leased to Formcraft Interiors, an architectural firm.
Wallace says 1515 Market’s location has long been a “magnet” for attorneys, legal and professional service firms.
“We have 29 law firm tenants and the Administrative Office of the Pennsylvania Supreme Court,” he says. “We’re right across the street from City Hall so lawyers can easily make court appearances or have meetings with judges and city officials. Our proximity to public transportation makes it easier for clients to visit their offices.”
1515’s largest tenant, accounting for 130,000 square feet, has developed a strong relationship with the building owner. Temple University, which occupies the first five full floors and part of the ground floor, has invested $3 million in improvements to its space and another $500,000 into new classroom technology, says Bill Parshall, director of the Center City campus.
The improvements included Temple University’s Café Bookstore, operated by Barnes & Noble, located on the ground floor.
“The owner has systematically upgraded the building including the heating, air conditioning and outside lighting which is very important to us because we offer many evening classes for working adults and graduate students,” says Parshall. “Plus, we couldn’t have a better location –right at the center of Philadelphia’s transportation hub.”
More than 3,000 students take credit and non-credit courses at Temple’s Center City campus.
“We have an excellent relationship with Accesso and we’re very happy with their cooperative, proactive and responsive attitudes,” says Parshall.
www.omegare.com
When Accesso Partners acquired 1515 Market Street for $85 million in December 2014, it pledged to improve the 20-story, 502,000 square foot office tower that houses Temple University’s Center City campus and dozens of professional service firms.
Accesso, chosen from 100 potential buyers, kept its promise, made significant improvements and has raised occupancy from 82% to 92.3% in the past 18 months. Some 47,081 square feet of office space leases were executed in the first half of this year and leases totaling another 10,000 square feet are out for signature.
The Hallandale, FL real estate investment manager added a ninth-floor conference center as an exclusive free amenity for tenants. The lobby, elevator cabs, the underground concourse entrance leading to SEPTA, common corridors and bathrooms have been upgraded. Elevators at the property are being modernized and aesthetic changes are underway.
“Accesso is a serious owner and the first in a long time to actually make substantial investments in this building as evidenced by capital improvements already completed and planned,” says Keli Wallace, senior property manager for Accesso Services, the owner’s property management subsidiary.
Recent new tenants include Sage Acquisitions, a real estate law and asset management firm, the law firm of Steven L. Chung Esq., McMahon Engineering, GZA Geoenvironmentalists, HDR Engineers and Architects and law firm Manley Deas Kochalski. Law firms Brainard Partners and Walker Nell renewed their leases. Law firms Litchfield Cavo; O’Brien, Rulis and Bochicchio; Wade, Clark Mulcahy; Legal Search and R-T Specialty, a service provider for insurance agents and brokers, expanded their offices.
“Philadelphia has been a sharply growing and improving office market in the last four to five years. To enter and compete here, Accesso realized it would have to put the right amount of capital into the right improvements and they did exactly that.”
Various “spec suites” with stylish finishes were recently built out with one immediately leased to Formcraft Interiors, an architectural firm.
Wallace says 1515 Market’s location has long been a “magnet” for attorneys, legal and professional service firms.
“We have 29 law firm tenants and the Administrative Office of the Pennsylvania Supreme Court,” he says. “We’re right across the street from City Hall so lawyers can easily make court appearances or have meetings with judges and city officials. Our proximity to public transportation makes it easier for clients to visit their offices.”
1515’s largest tenant, accounting for 130,000 square feet, has developed a strong relationship with the building owner. Temple University, which occupies the first five full floors and part of the ground floor, has invested $3 million in improvements to its space and another $500,000 into new classroom technology, says Bill Parshall, director of the Center City campus.
The improvements included Temple University’s Café Bookstore, operated by Barnes & Noble, located on the ground floor.
“The owner has systematically upgraded the building including the heating, air conditioning and outside lighting which is very important to us because we offer many evening classes for working adults and graduate students,” says Parshall. “Plus, we couldn’t have a better location –right at the center of Philadelphia’s transportation hub.”
More than 3,000 students take credit and non-credit courses at Temple’s Center City campus.
“We have an excellent relationship with Accesso and we’re very happy with their cooperative, proactive and responsive attitudes,” says Parshall.
www.omegare.com
Friday, September 2, 2016
Equus Capital Acquires Madison at the Lakes Apts
Connaught Inc. sold the Madison at the Lakes apartments at 3218 W. Cedar St. in Allentown, PA to Equus Capital Partners, Ltd. for $29.05 million, or about $124,000 per unit.
The 457,312-square-foot multifamily complex consists of 235 units across 26 buildings. The unit mix consists of 60 one-bedroom, 102 two-bedroom and 73 three-bedroom units. The pet-friendly property offers central air, dishwashers, eat-in kitchens, fireplaces, hardwood floors and washer-dryers.
www.omegare.com
The 457,312-square-foot multifamily complex consists of 235 units across 26 buildings. The unit mix consists of 60 one-bedroom, 102 two-bedroom and 73 three-bedroom units. The pet-friendly property offers central air, dishwashers, eat-in kitchens, fireplaces, hardwood floors and washer-dryers.
www.omegare.com
Planet Fitness to Open in Pennsville
Planet Fitness signed a lease for 17,500 square feet at Pennsville Marketplace at 709 S. Broadway in Pennsville, NJ with plans to move in Summer 2017.
Built in 1994, the center totals 170,000 square feet on 42 acres. The shopping center is anchored by a Wal-Mart.
www.omegare.com
Built in 1994, the center totals 170,000 square feet on 42 acres. The shopping center is anchored by a Wal-Mart.
www.omegare.com
Unison Realty Partners Acquires Harrisburg Retail Center, High Pointe Commons
by Steve Lubetkin, Globest.com
Boston-based Unison Realty Partners acquired High Pointe Commons, a premier 355,000-square-foot regional community center in Harrisburg, PA for $33.8 million.
Built in 2006, the property is anchored by an independent 125,000-square-foot Target and 98,000-square-foot JCPenney, which includes in-store Sephora and Disney Store concept shops. Those properties were not included in the sale.
Unison will be acquiring the remaining 132,000 square feet of the property, which includes a stable and diverse mix of fashion, service and food tenants, including Christmas Tree Shops, Chili’s Bar and Grill, and Petco. Today, High Pointe Commons, located off of Interstate 283, is 99 percent leased.
“High Pointe Commons is the epitome of what we look for in an investment,” says Karim Fadel, founder and principal of Unison Realty Partners. “With a convenient location in a growing market, historically high occupancy and a lineup of national retailers, we’re confident that High Pointe Commons will continue to draw in the local community while we work to improve and develop the center.”
Unison owns and operates a number of shopping centers along the east coast, including its most recent acquisition of Johnston Road Plaza, a grocery-anchored shopping center in Charlotte, NC. Targeting performing properties with value to unlock, Unison Realty Partners is actively seeking new deals throughout the Northeast and Southeast regions.
High Pointe Commons was a joint venture development of High Real Estate Group and CBL & Associates Properties.
“High Pointe Commons represents some of the highest quality construction and aesthetics of a shopping center within all of Central Pennsylvania contributing to capturing a best of class tenancy. Ownership was ahead of their time in 2005 by developing one of the first off-mall JCPenney locations, which has been a major success with the recent addition of Sephora and Disney stores within the store. High Pointe Commons is well positioned along one of the busiest interstate connectors in all of Central Pennsylvania, fronting Interstate 283. Interstate 283 brings retail customers from Route 322, from Hershey to the east, as well as Interstate 76 to the south and Interstate 83 from Harrisburg CBD. With high historical occupancy and the recent addition of Petco on one of the last pad sites at the property, the superior location will allow the new ownership to continue with success driven by a high volume Target.”
www.omegare.com
Boston-based Unison Realty Partners acquired High Pointe Commons, a premier 355,000-square-foot regional community center in Harrisburg, PA for $33.8 million.
Built in 2006, the property is anchored by an independent 125,000-square-foot Target and 98,000-square-foot JCPenney, which includes in-store Sephora and Disney Store concept shops. Those properties were not included in the sale.
Unison will be acquiring the remaining 132,000 square feet of the property, which includes a stable and diverse mix of fashion, service and food tenants, including Christmas Tree Shops, Chili’s Bar and Grill, and Petco. Today, High Pointe Commons, located off of Interstate 283, is 99 percent leased.
“High Pointe Commons is the epitome of what we look for in an investment,” says Karim Fadel, founder and principal of Unison Realty Partners. “With a convenient location in a growing market, historically high occupancy and a lineup of national retailers, we’re confident that High Pointe Commons will continue to draw in the local community while we work to improve and develop the center.”
Unison owns and operates a number of shopping centers along the east coast, including its most recent acquisition of Johnston Road Plaza, a grocery-anchored shopping center in Charlotte, NC. Targeting performing properties with value to unlock, Unison Realty Partners is actively seeking new deals throughout the Northeast and Southeast regions.
High Pointe Commons was a joint venture development of High Real Estate Group and CBL & Associates Properties.
“High Pointe Commons represents some of the highest quality construction and aesthetics of a shopping center within all of Central Pennsylvania contributing to capturing a best of class tenancy. Ownership was ahead of their time in 2005 by developing one of the first off-mall JCPenney locations, which has been a major success with the recent addition of Sephora and Disney stores within the store. High Pointe Commons is well positioned along one of the busiest interstate connectors in all of Central Pennsylvania, fronting Interstate 283. Interstate 283 brings retail customers from Route 322, from Hershey to the east, as well as Interstate 76 to the south and Interstate 83 from Harrisburg CBD. With high historical occupancy and the recent addition of Petco on one of the last pad sites at the property, the superior location will allow the new ownership to continue with success driven by a high volume Target.”
www.omegare.com
Thursday, September 1, 2016
Envestnet Moves into Chesterbrook
by Joseph N. DiStefano, Staff Writer Philadelphia Inquirer
Envestnet Inc., a publicly-traded Chicago company that makes software for investment firms, plans rapid expansion at its new software development center in Chesterbrook, Tredyffrin Township, which opened in June.
"I moved here from Chicago with my family" to head the operation, Josh Mayer, Envestnet's chief operating officer, told me. The company has hired over 100, expects to have 153 total staff to qualify for state aid by the end of the year, and has adjoining space to accomodate hundreds more.
Mayer likes the 10-minute commute, Tredyffrin-Easttown schools, and the "vibrant talent pool" of financial software developers and service professionals along U.S. 202 in Philadelphia's western suburbs.
"We did a search," Mayer told me. "I have people in Boston, in Denver, in Silicon Valley. But this area checked all the boxes for us. There are universities nearby. We have proximity to New York (financial clients) and transportation to our Chicago headquarters."
Most important: "I was pleasantly surprised by the significant technology presence here," with competitors including SEI Invesments in Oaks and Lockwood Advisors Inc. in Malvern, software development partners such as Wheelhouse Analytics in West Chester, and clients including Brinker Capital in King of Prussia and investment advisers who manage ETFs from Vanguard Group in Malvern. "We've had a lot of early success finding people with financial services backround who are also software engineers and talent people," Mayer concluded.
Pennsylvania has agreed to pay Envestnet nearly $500,000 in tax credits and grants, in exchange for the company's promise to hire at least 153 fulltime workers. The company has moved into 1000 Chesterbrook Blvd., Suite 135.
According to the state government's corporate-aid proposal, Envestnet planned "to consolidate portions of its operations from Chicago, Boston, Dallas, Denver and New York and other locations in the U.S. to a new leased facility in Chester County."
"Envestnet plans to invest at least $4.9 million in the project and has committed to creating 153 new full-time jobs over the next three years," according to a statement from Pennsylvania Gov. Tom Wolf's office. Envestnet last year earned around $12 million in profits, from sales of $421 million.
In a statement, Envestnet president Bill Crager said the company has already hired 115 workers "since moving into our facility in June," and plans to hire the rest of the 153 "by the end of the year."
The state Department of Community and Economic Development has agreed to give the company $459,000 in tax credits (corrected, not grants) after the new workers are hired, plus $36,000 from the WEDnetPA employee-training fund.
In a statement, State Sen. Andy Dinniman, D-Chester County, credited the recently-completed new lanes speeding traffic on congested US 202 for helping attract new and expanded employers to the aging office corridor.
According to Dinniman, the road helped open the way for Envestnet, as well as recent hiring announcements by health IT tech provider Cerner Corp., which is adding 250 at Great Valley Corporate Center north of Malvern, and biopharma developer Radius Health, which is adding 80 at its Swedesford Rd. location in eastern Tredyffrin Township.
www.omegare.com
Envestnet Inc., a publicly-traded Chicago company that makes software for investment firms, plans rapid expansion at its new software development center in Chesterbrook, Tredyffrin Township, which opened in June.
"I moved here from Chicago with my family" to head the operation, Josh Mayer, Envestnet's chief operating officer, told me. The company has hired over 100, expects to have 153 total staff to qualify for state aid by the end of the year, and has adjoining space to accomodate hundreds more.
Mayer likes the 10-minute commute, Tredyffrin-Easttown schools, and the "vibrant talent pool" of financial software developers and service professionals along U.S. 202 in Philadelphia's western suburbs.
"We did a search," Mayer told me. "I have people in Boston, in Denver, in Silicon Valley. But this area checked all the boxes for us. There are universities nearby. We have proximity to New York (financial clients) and transportation to our Chicago headquarters."
Most important: "I was pleasantly surprised by the significant technology presence here," with competitors including SEI Invesments in Oaks and Lockwood Advisors Inc. in Malvern, software development partners such as Wheelhouse Analytics in West Chester, and clients including Brinker Capital in King of Prussia and investment advisers who manage ETFs from Vanguard Group in Malvern. "We've had a lot of early success finding people with financial services backround who are also software engineers and talent people," Mayer concluded.
Pennsylvania has agreed to pay Envestnet nearly $500,000 in tax credits and grants, in exchange for the company's promise to hire at least 153 fulltime workers. The company has moved into 1000 Chesterbrook Blvd., Suite 135.
According to the state government's corporate-aid proposal, Envestnet planned "to consolidate portions of its operations from Chicago, Boston, Dallas, Denver and New York and other locations in the U.S. to a new leased facility in Chester County."
"Envestnet plans to invest at least $4.9 million in the project and has committed to creating 153 new full-time jobs over the next three years," according to a statement from Pennsylvania Gov. Tom Wolf's office. Envestnet last year earned around $12 million in profits, from sales of $421 million.
In a statement, Envestnet president Bill Crager said the company has already hired 115 workers "since moving into our facility in June," and plans to hire the rest of the 153 "by the end of the year."
The state Department of Community and Economic Development has agreed to give the company $459,000 in tax credits (corrected, not grants) after the new workers are hired, plus $36,000 from the WEDnetPA employee-training fund.
In a statement, State Sen. Andy Dinniman, D-Chester County, credited the recently-completed new lanes speeding traffic on congested US 202 for helping attract new and expanded employers to the aging office corridor.
According to Dinniman, the road helped open the way for Envestnet, as well as recent hiring announcements by health IT tech provider Cerner Corp., which is adding 250 at Great Valley Corporate Center north of Malvern, and biopharma developer Radius Health, which is adding 80 at its Swedesford Rd. location in eastern Tredyffrin Township.
www.omegare.com
Recent Philadelphia-Area CRE Deals Totaling $7 Million
by Steve Lubetkin, Globest.com
A number of Philadelphia sales and leases valued at $7 million have been recently completed.
45 S. Third Street in Old City sold for $800,000. The former home of The Irish Pōl, known for its brews, bourbons, and pub grub, has been purchased by Pioneer Ventures, owners of the pub concept Buffalo Billiards, currently operating in Philadelphia. Pioneer Ventures plans to open a second Buffalo Billiards location/new concept after renovations are complete. The two-story property was built in 1900.
The General Services Administration leased 17,804 square feet at 9300 Ashton Road in Northeast Philadelphia. The Social Security Administration will relocate there from 2373 Welsh Road.
United Refrigeration leased approximately 13,000 square feet at 606 Spring Garden Street to I. Brewster & Company Gallery. Brewster will use the space as a showroom and administrative space for the growing gallery, enabling the 30-year Philadelphia tenant to expand the depth of inventory in masters, contemporary and pop art paintings, drawings, and original prints.
Ameribest Homecare leased 6,000 square feet at 1217-35 Spring Garden Street. The company, which provides comprehensive home health and personal care services, is relocating from 926 Race Street.
www.omegare.com
A number of Philadelphia sales and leases valued at $7 million have been recently completed.
45 S. Third Street in Old City sold for $800,000. The former home of The Irish Pōl, known for its brews, bourbons, and pub grub, has been purchased by Pioneer Ventures, owners of the pub concept Buffalo Billiards, currently operating in Philadelphia. Pioneer Ventures plans to open a second Buffalo Billiards location/new concept after renovations are complete. The two-story property was built in 1900.
The General Services Administration leased 17,804 square feet at 9300 Ashton Road in Northeast Philadelphia. The Social Security Administration will relocate there from 2373 Welsh Road.
United Refrigeration leased approximately 13,000 square feet at 606 Spring Garden Street to I. Brewster & Company Gallery. Brewster will use the space as a showroom and administrative space for the growing gallery, enabling the 30-year Philadelphia tenant to expand the depth of inventory in masters, contemporary and pop art paintings, drawings, and original prints.
Ameribest Homecare leased 6,000 square feet at 1217-35 Spring Garden Street. The company, which provides comprehensive home health and personal care services, is relocating from 926 Race Street.
www.omegare.com
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