Friday, November 30, 2018
Deutsche Bank's Asset Manager Sells 636-Unit Apartment Complex in Philadelphia
Lakewood, New Jersey-based Chelsea Management, a full service investment firm, purchased a 636-unit apartment complex in Philadelphia from DWS Group, Deutsche Bank's asset manager. Lincoln Green sold for $102.6 million, or about $161,000 per unit.
The garden-style complex at 4000-4040 Presidential Blvd. comprises one- and two-bedroom units ranging from 588 to 960 square feet in 30, three-story buildings. Built in 1986, the Class B property spans north of 20 acres less than two miles from the Bala train station.
Chelsea Management secured $91.59 million in financing for the acquisition of Lincoln Green. Dan Sacks of Greystone orginated the Freddie Mac loan, which features a 10-year fixed rate and six years of interest-only payments over a 30-year amortization period with leverage at 80.3 percent of the purchase price.
"The execution all around was stellar, and an absolute homerun for our client. That is truly what being a mortgage banker is all about, and we are grateful to have such close working relationships with our clients and our agency partners," Sacks said in a statement.
www.omegare.com
The garden-style complex at 4000-4040 Presidential Blvd. comprises one- and two-bedroom units ranging from 588 to 960 square feet in 30, three-story buildings. Built in 1986, the Class B property spans north of 20 acres less than two miles from the Bala train station.
Chelsea Management secured $91.59 million in financing for the acquisition of Lincoln Green. Dan Sacks of Greystone orginated the Freddie Mac loan, which features a 10-year fixed rate and six years of interest-only payments over a 30-year amortization period with leverage at 80.3 percent of the purchase price.
"The execution all around was stellar, and an absolute homerun for our client. That is truly what being a mortgage banker is all about, and we are grateful to have such close working relationships with our clients and our agency partners," Sacks said in a statement.
www.omegare.com
Strong Economy Keeping All Asset Classes Riding High
Demand for industrial facilities for distribution of goods to consumers continues to rise and hit historic benchmarks across the board, according to William Hankowsky, CEO of Liberty Property Trust, which is in the midst of a portfolio rotation away from office properties to a singular focus on the industrial sector.
Hankowsky’s message of a strong economic lifting all sectors of commercial real estate was echoed by other speakers at the annual Real Estate Outlook sponsored by the Urban Land Institute Philadelphia Thursday.
“Obviously, it’s the most dramatic, strongest market industrial space has ever seen in its history no matter what statistic you look at,” Hankowsky told more than 500 attendees at the Union League Club. “You’ve had 34 consecutive quarters of positive net absorption in many markets, you’re seeing the highest rents you’ve ever seen, and the converse of that is in many markets you’re seeing the lowest cap rates you’ve ever seen. Properties are trading in Southern California starting with a three, or North Jersey, and even in secondary markets, most of the trade now starts with a five in terms of a cap rate.”
The strong demand is largely a product of an unusually strong economic recovery, but layered on that, Hankowsky says, is the rising need for distribution facilities for e-commerce retailers.
“E-commerce has been a unbelievable structural change element in terms of the industrial space,” he says. “Ten years ago, most of us didn’t know we needed something delivered to our house in two days. Five years ago, you didn’t even know you needed it in a day, and you didn’t know three years ago you needed it today in an hour. That change in the customer consumer expectation about delivery times has had a dramatic fundamental effect on industrial space.”
The design of warehouse buildings has also been affected by the rising demand for rapid delivery, Hankowsky says. Warehouses now tend to accommodate 40-foot heights for more efficient racking of stock, and tenants need more land under the buildings because of the increased need for employee parking at large distribution centers, he says. Another significant change in the market is a greater focus on correlation of location and labor, he says. Warehouses now need to be close to an accessible workforce, so much so that “the HR person is often on the first visit to the location,” he says. “That never happened five years ago.”
In the retail sector, Joseph Coradino, chairman and CEO of PREIT, highlighted changes in the product mix at his firm’s malls, which used to allocate as much as 75% of their space to apparel sales, but are now redeveloping more experiential retail like restaurants, entertainment, and fitness.
Contrary to the constant barrage of obituaries for traditional retail that he faces, even from family and friends, Coradino noted that traffic at PREIT malls so far this holiday season is running above last year. The company issued a press release on traffic—timed to coincide with Coradino’s appearance at the Union League Club gathering—indicating that traffic at its Viewmont Mall in Scranton, PA was up 11 percent, and at the Moorestown, NJ, Mall, traffic rose significantly, even though a large space once occupied by Macy’s has only been partially filled with smaller retailers HomeSense and FiveBelow.
“Those two small stores occupy about 50,000 square feet of that 260,000 square feet,” Coradino says. “Traffic is up 9 percent.”
Many mall retailers now offer a service Coradino described as “BOPUS,” which means “buy online and pickup in store.” The service has the added effect of encouraging additional purchases, too.
“When someone picks up something at one of our properties, there’s a 73 percent chance that they’re going to make an ancillary purchase at the property,” Coradino says.
In the hospitality sector, customers are looking for luxury and willing to pay for it, according to Jay Shah, CEO of Hersha Hospitality Trust.
“We find that lifestyle and luxury today are the two segments where we have the greatest ability to drive rate and pricing power,” he says. “They seem to differentiate themselves in a way away from the commodity hotel products, and that’s what we’re finding that the markets are really seeking and willing to pay for.”
Hersha acquired the Philadelphia Westin about a year ago, Shah noted, and the property is fulfilling its promise, with the third quarter showing especially good performance, he says.
“That was driven primarily by continued strength in Philadelphia’s life science sector and the corporate sector, and leisure visitation to Philadelphia continues to be very strong,” he says.
Expansion of the definition of the modern office is one of the biggest adjustments taking place in the office sector, says Jerry Sweeney, president, CEO and trustee of Brandywine Realty Trust.
“In office, it used to be that you went to a definitive place to work,” Sweeney says. “With technology and other alternatives, the city really has now become the workplace, not one specific location.”
Brandywine’s portfolio today has less square footage but a higher quality overall product today compared with five years ago, Sweeney says.
“Our internal focus in our company right now is on preleasing some of our development pipeline and perfecting all of our approvals, including running all of those developments completely through the design development process,” he says. “Unless we fully price out our deals, it puts us at a real disadvantage in terms of attracting a corporate client, because we need to know—in this environment of rising construction costs and pricing volatility—what we can actually deliver.”
Real estate markets across the country are being driven by the search for talent, according to Lauren Gilchrist, senior vice president of research for Jones Lang LaSalle Philadelphia.
“Unemployment in the US right now is 3.7 percent, unemployment for people with a bachelor’s degree or more is two percent,” she says. “This is far beyond the conditions of full employment at this point in time, which means that competition for people is fierce.”
The talent pool is one of the factors that led to the Amazon decision to locate part of its HQ2 project in Long Island City, NY, she says. New York and Washington, DC are graduating students trained in technology fields at a much higher rate than the Philadelphia market, she says.
“When you look at the fact that New York and DC have graduated 31,000 advanced degree holders in one year, and you think about the fact that this company is looking for 50,000 people in technical occupations, you begin to understand, despite everything else, why our 6,000 STEM degree holders might not cut it,” she says.
The event also serves as the launch every year for the Emerging Trends in Real Estate Report jointly produced by ULI and PricewaterhouseCoopers, now in its 40th year.
Mitch Roschelle, PwC partner and business development leader, says this year’s report ranks Philadelphia in the top five cities for both hotel and industrial investment.
Building on Gilchrist’s remarks about the talent search, Roschelle expressed concern that job openings are going unfilled.
“We have seven million job openings, we have just under six million unemployed,” he says. “So there are a million people that we don’t have, for the job openings that we do have.”
Top trends from this year’s report include:
“ULI Philadelphia is proud to share this national research and bring together a high-level discussion and projection about the local real estate market led by our industry leaders in hotel, industrial, office, multifamily and retail development,” says Paul Commito, chair of ULI Philadelphia, a senior vice president at Brandywine Realty Trust. “Building on last year’s record-breaking program and attendance, today’s speakers gave our community a lot to think about as we tackle a fascinating year in development. I am proud of the progress we have made the ULI Philadelphia District Council and look forward to continuing to engage with new and established members, growing committees and serving the broader industry through our ULI Philadelphia advisory and impact projects.”
www.omegare.com
Hankowsky’s message of a strong economic lifting all sectors of commercial real estate was echoed by other speakers at the annual Real Estate Outlook sponsored by the Urban Land Institute Philadelphia Thursday.
“Obviously, it’s the most dramatic, strongest market industrial space has ever seen in its history no matter what statistic you look at,” Hankowsky told more than 500 attendees at the Union League Club. “You’ve had 34 consecutive quarters of positive net absorption in many markets, you’re seeing the highest rents you’ve ever seen, and the converse of that is in many markets you’re seeing the lowest cap rates you’ve ever seen. Properties are trading in Southern California starting with a three, or North Jersey, and even in secondary markets, most of the trade now starts with a five in terms of a cap rate.”
The strong demand is largely a product of an unusually strong economic recovery, but layered on that, Hankowsky says, is the rising need for distribution facilities for e-commerce retailers.
“E-commerce has been a unbelievable structural change element in terms of the industrial space,” he says. “Ten years ago, most of us didn’t know we needed something delivered to our house in two days. Five years ago, you didn’t even know you needed it in a day, and you didn’t know three years ago you needed it today in an hour. That change in the customer consumer expectation about delivery times has had a dramatic fundamental effect on industrial space.”
The design of warehouse buildings has also been affected by the rising demand for rapid delivery, Hankowsky says. Warehouses now tend to accommodate 40-foot heights for more efficient racking of stock, and tenants need more land under the buildings because of the increased need for employee parking at large distribution centers, he says. Another significant change in the market is a greater focus on correlation of location and labor, he says. Warehouses now need to be close to an accessible workforce, so much so that “the HR person is often on the first visit to the location,” he says. “That never happened five years ago.”
In the retail sector, Joseph Coradino, chairman and CEO of PREIT, highlighted changes in the product mix at his firm’s malls, which used to allocate as much as 75% of their space to apparel sales, but are now redeveloping more experiential retail like restaurants, entertainment, and fitness.
Contrary to the constant barrage of obituaries for traditional retail that he faces, even from family and friends, Coradino noted that traffic at PREIT malls so far this holiday season is running above last year. The company issued a press release on traffic—timed to coincide with Coradino’s appearance at the Union League Club gathering—indicating that traffic at its Viewmont Mall in Scranton, PA was up 11 percent, and at the Moorestown, NJ, Mall, traffic rose significantly, even though a large space once occupied by Macy’s has only been partially filled with smaller retailers HomeSense and FiveBelow.
“Those two small stores occupy about 50,000 square feet of that 260,000 square feet,” Coradino says. “Traffic is up 9 percent.”
Many mall retailers now offer a service Coradino described as “BOPUS,” which means “buy online and pickup in store.” The service has the added effect of encouraging additional purchases, too.
“When someone picks up something at one of our properties, there’s a 73 percent chance that they’re going to make an ancillary purchase at the property,” Coradino says.
In the hospitality sector, customers are looking for luxury and willing to pay for it, according to Jay Shah, CEO of Hersha Hospitality Trust.
“We find that lifestyle and luxury today are the two segments where we have the greatest ability to drive rate and pricing power,” he says. “They seem to differentiate themselves in a way away from the commodity hotel products, and that’s what we’re finding that the markets are really seeking and willing to pay for.”
Hersha acquired the Philadelphia Westin about a year ago, Shah noted, and the property is fulfilling its promise, with the third quarter showing especially good performance, he says.
“That was driven primarily by continued strength in Philadelphia’s life science sector and the corporate sector, and leisure visitation to Philadelphia continues to be very strong,” he says.
Expansion of the definition of the modern office is one of the biggest adjustments taking place in the office sector, says Jerry Sweeney, president, CEO and trustee of Brandywine Realty Trust.
“In office, it used to be that you went to a definitive place to work,” Sweeney says. “With technology and other alternatives, the city really has now become the workplace, not one specific location.”
Brandywine’s portfolio today has less square footage but a higher quality overall product today compared with five years ago, Sweeney says.
“Our internal focus in our company right now is on preleasing some of our development pipeline and perfecting all of our approvals, including running all of those developments completely through the design development process,” he says. “Unless we fully price out our deals, it puts us at a real disadvantage in terms of attracting a corporate client, because we need to know—in this environment of rising construction costs and pricing volatility—what we can actually deliver.”
Real estate markets across the country are being driven by the search for talent, according to Lauren Gilchrist, senior vice president of research for Jones Lang LaSalle Philadelphia.
“Unemployment in the US right now is 3.7 percent, unemployment for people with a bachelor’s degree or more is two percent,” she says. “This is far beyond the conditions of full employment at this point in time, which means that competition for people is fierce.”
The talent pool is one of the factors that led to the Amazon decision to locate part of its HQ2 project in Long Island City, NY, she says. New York and Washington, DC are graduating students trained in technology fields at a much higher rate than the Philadelphia market, she says.
“When you look at the fact that New York and DC have graduated 31,000 advanced degree holders in one year, and you think about the fact that this company is looking for 50,000 people in technical occupations, you begin to understand, despite everything else, why our 6,000 STEM degree holders might not cut it,” she says.
The event also serves as the launch every year for the Emerging Trends in Real Estate Report jointly produced by ULI and PricewaterhouseCoopers, now in its 40th year.
Mitch Roschelle, PwC partner and business development leader, says this year’s report ranks Philadelphia in the top five cities for both hotel and industrial investment.
Building on Gilchrist’s remarks about the talent search, Roschelle expressed concern that job openings are going unfilled.
“We have seven million job openings, we have just under six million unemployed,” he says. “So there are a million people that we don’t have, for the job openings that we do have.”
Top trends from this year’s report include:
- The rise of the “18-Hour Suburb” and that the millennial question is starting to be answered: many are looking for suburbs with urban amenities and good
- Retail space is not dead, and it is a good time to repurpose space for alternative
- New office buildings and multifamily assets are going above and beyond to meet a range of tenant needs through “amenities gone wild”.
- Disruptors ranging from package delivery to autonomous vehicles are forcing redesign and amenity shifts for residential and commercial
- Environmental, Social and Governance Practices are important to investors. Sensitivity to these issues has increased and funds with these strategies in mind could see an
- Last mile industrial development is in high demand with the expansion of e-commerce far from over and the need for facilities to accommodate a dense distribution network
“ULI Philadelphia is proud to share this national research and bring together a high-level discussion and projection about the local real estate market led by our industry leaders in hotel, industrial, office, multifamily and retail development,” says Paul Commito, chair of ULI Philadelphia, a senior vice president at Brandywine Realty Trust. “Building on last year’s record-breaking program and attendance, today’s speakers gave our community a lot to think about as we tackle a fascinating year in development. I am proud of the progress we have made the ULI Philadelphia District Council and look forward to continuing to engage with new and established members, growing committees and serving the broader industry through our ULI Philadelphia advisory and impact projects.”
www.omegare.com
Thursday, November 29, 2018
Wednesday, November 28, 2018
Seavest, Trammell Crow Developing Hospital for Allegheny Health Network
by Steve Lubetkin, Globest.com
Patients of Allegheny Health Network, a subsidiary of Highmark Health, will soon have a new convenient, state-of-the-art care option in Hempfield Township, Westmoreland County, about 30 miles southeast of Pittsburgh.
Real estate investment firm Seavest Healthcare Properties and its development partner, Trammell Crow Company, are building new, class A, 75,000-square-foot care facility for AHN, a leading integrated delivery care system in Western Pennsylvania.
The new Hempfield facility—consisting of an emergency department and 10-bed, small-format hospital; a full-service cancer center; and medical office space—is part of a neighborhood hospital complex the network is building at the intersection of Route 30 (Lincoln Highway) and Agnew Road.
The small-format AHN hospital is a joint venture of AHN and Emerus, the nation’s largest operator of small-format hospitals. Emerus Holdings, a Texas-based company, operates more than 20 neighborhood hospitals across the country, and recently surpassed the one million patients treated milestone.
“With this neighborhood hospital and community cancer center, we are bringing to Westmoreland County an innovative, patient-centered model that will provide the best possible experience, quality and outcomes for those requiring emergency care, short hospital stays, cancer care and other outpatient services,” says Cynthia Hundorfean, AHN president and CEO. “We have taken a number of important steps over the past year to expand access to AHN physicians and programs in Westmoreland County, and this wonderful new facility will further ensure that the people who live here have exceptional choices close to home for their healthcare needs.”
“Seavest is privileged to be a part of this project, helping to bring expanded healthcare services to Westmoreland County,” says Jonathan Winer, senior managing director and chief investment officer of Seavest Healthcare Properties. “Not only will the project bring expanded emergency services, cancer care and medical specialists to the area, there is the potential to add more services in the future.”
“Trammell Crow Company is honored to be a part of making this project a reality for the community,” says Davis Griffin, a principal with Trammell Crow. “Speed to market is essential for this project. Relying upon our top-notch team in place and our long-standing relationship with Seavest, we will be able to accelerate our construction timeline in order for AHN to meet its goals for opening the facility.”
Construction of the Hempfield project commenced in July, with completion of the cancer center anticipated by late summer 2019 and the remainder of the building in November 2019.
www.omegare.com
Patients of Allegheny Health Network, a subsidiary of Highmark Health, will soon have a new convenient, state-of-the-art care option in Hempfield Township, Westmoreland County, about 30 miles southeast of Pittsburgh.
Real estate investment firm Seavest Healthcare Properties and its development partner, Trammell Crow Company, are building new, class A, 75,000-square-foot care facility for AHN, a leading integrated delivery care system in Western Pennsylvania.
The new Hempfield facility—consisting of an emergency department and 10-bed, small-format hospital; a full-service cancer center; and medical office space—is part of a neighborhood hospital complex the network is building at the intersection of Route 30 (Lincoln Highway) and Agnew Road.
The small-format AHN hospital is a joint venture of AHN and Emerus, the nation’s largest operator of small-format hospitals. Emerus Holdings, a Texas-based company, operates more than 20 neighborhood hospitals across the country, and recently surpassed the one million patients treated milestone.
“With this neighborhood hospital and community cancer center, we are bringing to Westmoreland County an innovative, patient-centered model that will provide the best possible experience, quality and outcomes for those requiring emergency care, short hospital stays, cancer care and other outpatient services,” says Cynthia Hundorfean, AHN president and CEO. “We have taken a number of important steps over the past year to expand access to AHN physicians and programs in Westmoreland County, and this wonderful new facility will further ensure that the people who live here have exceptional choices close to home for their healthcare needs.”
“Seavest is privileged to be a part of this project, helping to bring expanded healthcare services to Westmoreland County,” says Jonathan Winer, senior managing director and chief investment officer of Seavest Healthcare Properties. “Not only will the project bring expanded emergency services, cancer care and medical specialists to the area, there is the potential to add more services in the future.”
“Trammell Crow Company is honored to be a part of making this project a reality for the community,” says Davis Griffin, a principal with Trammell Crow. “Speed to market is essential for this project. Relying upon our top-notch team in place and our long-standing relationship with Seavest, we will be able to accelerate our construction timeline in order for AHN to meet its goals for opening the facility.”
Construction of the Hempfield project commenced in July, with completion of the cancer center anticipated by late summer 2019 and the remainder of the building in November 2019.
www.omegare.com
Trammell Crow Building 1M SF Spec Industrial in Scranton Opportunity Zone
by Steve Lubetkin, Globest.com
Trammell Crow Company has purchased a 90-acre site in the Valley View Business Park from the Scranton Lackawanna Industrial Building Company, for construction of Valley View Trade Center, a new, one million-square-foot speculative distribution facility. SLIBCO is the industrial development affiliate of the Greater Scranton Chamber of Commerce.
“We are very pleased that a renowned developer like Trammell Crow Company has chosen to invest in our region—with our quality workforce, prime location and access to major markets— to create jobs and address the demands of the growing e-commerce industry,” says Bob Durkin, president, The Greater Scranton Chamber of Commerce. “We thank Jessup Borough, Valley View School District and Lackawanna County for approving the LERTA tax abatement program in order to make this deal possible.”
The state-of-the-art building is scheduled to be completed in the third quarter of 2019 and will feature 40-foot clear height, 190-foot deep truck court with opposing trailer storage, ESFR fire protection, 311 trailer parking spots, 277 car parking spots, and 159 dock positions, expandable to 209.
The project will also provide economic and tax incentives, qualifying as a Keystone Opportunity Expansion Zone and for the Local Economic Revitalization Tax Assistance program. In addition, the project will serve as a Qualified Opportunity Zone to encourage long-term investment in the area.
“We are pleased to be working on this exciting project in Jessup Borough,” says Andrew Mele, managing director of TCC’s NE Metro Business Unit. “In addition to best-in-class design quality, the project will enjoy proximity to a strong, vibrant labor force and a strategic location with access to over 80 million consumers within an overnight drive.”
www.omegare.com
Trammell Crow Company has purchased a 90-acre site in the Valley View Business Park from the Scranton Lackawanna Industrial Building Company, for construction of Valley View Trade Center, a new, one million-square-foot speculative distribution facility. SLIBCO is the industrial development affiliate of the Greater Scranton Chamber of Commerce.
“We are very pleased that a renowned developer like Trammell Crow Company has chosen to invest in our region—with our quality workforce, prime location and access to major markets— to create jobs and address the demands of the growing e-commerce industry,” says Bob Durkin, president, The Greater Scranton Chamber of Commerce. “We thank Jessup Borough, Valley View School District and Lackawanna County for approving the LERTA tax abatement program in order to make this deal possible.”
The state-of-the-art building is scheduled to be completed in the third quarter of 2019 and will feature 40-foot clear height, 190-foot deep truck court with opposing trailer storage, ESFR fire protection, 311 trailer parking spots, 277 car parking spots, and 159 dock positions, expandable to 209.
The project will also provide economic and tax incentives, qualifying as a Keystone Opportunity Expansion Zone and for the Local Economic Revitalization Tax Assistance program. In addition, the project will serve as a Qualified Opportunity Zone to encourage long-term investment in the area.
“We are pleased to be working on this exciting project in Jessup Borough,” says Andrew Mele, managing director of TCC’s NE Metro Business Unit. “In addition to best-in-class design quality, the project will enjoy proximity to a strong, vibrant labor force and a strategic location with access to over 80 million consumers within an overnight drive.”
www.omegare.com
Subscribe to:
Posts (Atom)
