Local investment firm Morgan Properties acquired the 504-unit Marchwood Apartments in Exton, Pennsylvania, from BET Investments for $82 million, or about $163,000 per unit.
The garden-style community at 105 Coach Lane comprises a mix of one-, two- and three-bedroom units ranging from 810 to 1,300 square feet in 40, two-story buildings. Built in 1973, the 95% occupied property spans 43.6 acres less than 30 miles from Philadelphia International Airport.
Morgan Properties President Jonathan Morgan said in a statement, "We are bullish on the suburban Philadelphia market. We look for Class B properties with a value-add component and saw this as a nice opportunity to further expand our suburban Philadelphia assets."
He also mentioned that they had a pre-existing relationship with the seller, making for a smooth transaction.
In March, Morgan Properties acquired a 10-property multifamily portfolio from Lonestar known as the Home Properties Portfolio for $890.5 million. Seven of the communities were located in Pennsylvania while the other three were in Northern Virginia. The firm owns and operates more than 167 multifamily apartment communities and over 51,000 units across the Mid-Atlantic, Nashville and Northeastern United States, according to its website.
www.omegare.com
Friday, June 28, 2019
The Galman Group Buys Studio Green, Park Place Complexes for $40.96 Million
Local investment firm The Galman Group purchased the 338-unit Studio Green and the 276-unit Park Place multifamily complexes in Newark, Delaware, from Houston-based Campus Living Villages for $40.96 million, or about $67,000 per unit.
The Studio Green student housing community at 91 Thorn Lane will be converted to apartment units named Thorn Flats. Built in 1965, the property comprises a mix of studio to four-bedroom units ranging from 484 to 1,507 square feet in 59, three-story buildings.
The garden-style Park Place complex at 650 Lehigh Road features a mix of one- and two-bedroom units ranging from 601 to 1,033 square feet in 23, three-story buildings. The Class B property spans 5.2 acres and was built in 1965.
www.omegare.com
The Studio Green student housing community at 91 Thorn Lane will be converted to apartment units named Thorn Flats. Built in 1965, the property comprises a mix of studio to four-bedroom units ranging from 484 to 1,507 square feet in 59, three-story buildings.
The garden-style Park Place complex at 650 Lehigh Road features a mix of one- and two-bedroom units ranging from 601 to 1,033 square feet in 23, three-story buildings. The Class B property spans 5.2 acres and was built in 1965.
www.omegare.com
Thursday, June 27, 2019
Innovative Hospitality Management Buys Hotel Near Hersheypark
Local investment firm Innovative Hospitality Management purchased the 110-room Hampton Inn & Suites in Hershey, Pennsylvania, from New York-based The Blackstone Group.
The three-story hotel at 749 E. Chocolate Ave. was built in 1999. The Class B property spans 2.2 acres less than a mile from Hersheypark.
Ketan Patel and Kevin Hanley with HREC Investment Advisors represented the seller, which originally purchased the property as part of a portfolio in December 2013, CoStar data shows.
Greg Porter at HREC Capital Markets Group led purchase financing. The non-recourse acquisition loan was sized to 72.6% of the purchase price plus budgeted PIP cost and 71.5% of the property’s post-PIP value and has a 10-year fixed rate of 4.35% and 30-year amortization.
www.omegare.com
The three-story hotel at 749 E. Chocolate Ave. was built in 1999. The Class B property spans 2.2 acres less than a mile from Hersheypark.
Ketan Patel and Kevin Hanley with HREC Investment Advisors represented the seller, which originally purchased the property as part of a portfolio in December 2013, CoStar data shows.
Greg Porter at HREC Capital Markets Group led purchase financing. The non-recourse acquisition loan was sized to 72.6% of the purchase price plus budgeted PIP cost and 71.5% of the property’s post-PIP value and has a 10-year fixed rate of 4.35% and 30-year amortization.
www.omegare.com
W.P. Carey Shows Appetite for Industrial Properties with Latest Deals
New York real estate investment trust W.P. Carey announced it paid $53 million for a variety of industrial buildings around the country in a sign that industrial properties are prime investment targets.
Sales of industrial buildings remain strong, though a bit off from a record selling last half of 2018, which was driven by big investors merging and acquiring one another. The report noted that “strong price appreciation has mirrored rent growth.”
Two of the properties W.P. Carey recently bought house operations for a company that basically provides the products that turn warehouses into distribution centers. It paid $10 million for a building in Westerville, Ohio, and another in North Wales, Pennsylvania, that are leased to Integrated Warehouse Solutions. The Forth Worth-based company is a roll up of three companies -- Bluff Manufacturing, Nordock and Wesco Industrial Products.
All of the deals involve the owners selling the properties and leasing them back. They include triple-net leases in which the tenant pays for more of the property’s operating expenses. The deal with IWS came with a 20-year lease.
W.P. Carey’s largest latest deal, $24 million, included eight production buildings in the United States and in Mexico from “a leading global manufacturer of electrical wire harnesses, control boxes and other value-added components for a diverse customer base.”
The buildings make up a “significant portion” of the undisclosed company’s North American manufacturing operations. W.P. Carey also has 20-year leases on those buildings.
Its third deal cost the REIT $19 million to acquire a 301,000-square-foot building in Statesville, North Carolina, leased to Front Sport Group, a company that owns athletic apparel brands Badger Sport and Alleson Athletic.
Earlier this year, W.P. Carey bought a fully leased food production plant in an undisclosed location for $44.7 million. It also paid $38 million for a distribution center leased to Memphis-based Orgill, a wholesale supplier to independent hardware stores, at 4925 Tablers Station Road in Inwood, West Virginia.
www.omegare.com
Sales of industrial buildings remain strong, though a bit off from a record selling last half of 2018, which was driven by big investors merging and acquiring one another. The report noted that “strong price appreciation has mirrored rent growth.”
Two of the properties W.P. Carey recently bought house operations for a company that basically provides the products that turn warehouses into distribution centers. It paid $10 million for a building in Westerville, Ohio, and another in North Wales, Pennsylvania, that are leased to Integrated Warehouse Solutions. The Forth Worth-based company is a roll up of three companies -- Bluff Manufacturing, Nordock and Wesco Industrial Products.
All of the deals involve the owners selling the properties and leasing them back. They include triple-net leases in which the tenant pays for more of the property’s operating expenses. The deal with IWS came with a 20-year lease.
W.P. Carey’s largest latest deal, $24 million, included eight production buildings in the United States and in Mexico from “a leading global manufacturer of electrical wire harnesses, control boxes and other value-added components for a diverse customer base.”
The buildings make up a “significant portion” of the undisclosed company’s North American manufacturing operations. W.P. Carey also has 20-year leases on those buildings.
Its third deal cost the REIT $19 million to acquire a 301,000-square-foot building in Statesville, North Carolina, leased to Front Sport Group, a company that owns athletic apparel brands Badger Sport and Alleson Athletic.
Earlier this year, W.P. Carey bought a fully leased food production plant in an undisclosed location for $44.7 million. It also paid $38 million for a distribution center leased to Memphis-based Orgill, a wholesale supplier to independent hardware stores, at 4925 Tablers Station Road in Inwood, West Virginia.
www.omegare.com
Here's Where US Apartments Are Heading
by Lou Hirsh Costar
Apartment developers are experimenting with new and niche styles, amenities and features to keep project pipelines flowing and new buildings filled with renters, almost a decade into a national economic expansion that propelled the U.S. multifamily market to new heights.
Some developers are doubling down on luxury amenities in large floor plans, while others are emulating the so-called sharing economy with "micro" units built around shared living spaces. Some seek to create quiet getaways, and some meld their projects into larger mixed-use entertainment districts, increasingly tied to professional sports venues, or put them closer to public transit.
Based on input from CoStar analysts nationwide, and in no particular order, here are five apartment projects showing how developers are aiming to serve diverse customer priorities, while dealing with rising costs and other factors challenging their ability to get affordable new housing built.
Dwell at 2nd Street, Philadelphia (Developer: Klein Company)
Developer Klein Co. is betting on the prefab movement to help control costs at its newest project, a 320-unit complex (shown above) in Philadelphia’s emerging Olde Kensington neighborhood. Most of its apartments will be built from modular units prefabricated off-site, according to the developer.
Business consulting firm McKinsey & Co. reports that modular construction in the United States has accelerated project completion timeliness by 20 to 50%, while reducing construction costs by 20% or more. The practice is still relatively uncommon in the apartment industry but could soon show up more often in some markets.
"Philadelphia has some of the highest construction costs of any major U.S. market, and the modular approach is being used to expedite construction time and lower development costs," said Adrian Ponsen, a Philadelphia-based director of analytics for CoStar Group. "You’ll see more projects like these as developers look for innovative ways to maintain their returns in the face of rising construction costs over the long term."
Little has been announced about amenities at the site, which is scheduled to be completed in early 2020.
CitySpaces 500 Kirkham, Oakland, California (Developer: Panoramic Interests)
Higher-density, transit-friendly projects have steadily gained traction in major cities. CitySpaces takes the trend further. Tiny units help to create this massive 1,032-unit "micro-pad" apartment community on three acres in Oakland, California, by Panoramic Interests. The developer’s website notes that its trademarked MicroPad concept is a 160-square-foot, self-contained dwelling with a private bathroom and kitchenette.
The project, which is currently in entitlement phases, is designed to include three buildings made of steel modular units constructed off-site and assembled in place. Plans call for 59 parking spaces to be devoted to car-share services like Zipcar, and the development is adjacent to West Oakland BART station.
Units are stacked to create buildings up to 12 stories tall.
City Club Apartments, Minneapolis (Developer: City Club Apartments LLC)
City Club Apartments in Minneapolis provide an opportunity for residents to stay on the property and grow their accommodations as their financial or life situations change over time, offering a mini-pad for single residents and larger units for growing families.
Set for completion next month, the project is expected to bring the micro-unit concept to a downtown setting, targeting recent college graduates and other young renters. The site comprises 307 units, with about half of those measuring 407 square feet or less. The smallest units are around 360 square feet.
Notably, the complex is designed to have 100 units with one and two bedrooms to accommodate tenants who might eventually want to move beyond the base-sized unit to more roomy accommodations, said Michael Roessle, director of market analytics CoStar Group in Minneapolis.
The project is designed to have 24-hour amenities including a fitness center, conference and business center, and concierge services, outdoor pool, indoor and outdoor theaters and on-site restaurant.
There will be no parking, as many young renters in the urban core don’t own a car and prefer biking and ride-sharing to get to work at several large nearby employers.
Ten Thousand, Los Angeles (Developer: Crescent Heights)
From robot butlers to dog spas, the ultimate in luxury amenities are showcased at this Los Angeles apartment high-rise, which could influence other nearby developers to compete more lavishly for the same high-spending customers.
Opened in 2017 and a potential tone-setter for future surrounding projects, this 40-story tower has drawn national media attention as an example of ultra-high luxury, in a city that has no shortage of conspicuously posh housing arrangements. Located on the border of L.A.’s Century City and the city of Beverly Hills, it has two-bedroom units going for between $10,000 and $30,000 per month, with some penthouses going for double that higher-end figure.
Other developers with similar clientele could be looking to keep up with high-touch services that have included on-site space for botox treatments. The developer’s website points to features including a dog spa, a cold-storage package delivery facility for perishable items and a robot butler named Charley that delivers mini-bar items to residents.
Twelve Cowboys Way, Frisco, Texas (Developer: Columbus Realty Partners)
Renters can live, work and play all on the same property in this Texas development, with "play" in this instance referencing the growing trend of professional sports teams entering the commercial development arena to interact with fans well beyond game times.
Among the latest examples of teams getting into the field of apartment and mixed-use development near their facilities, this 17-story luxury tower is scheduled to open in 2020 next to the suburban headquarters of the National Football League’s Dallas Cowboys.
The project is spearheaded by a group that includes the Cowboys’ Hall-of-Fame former quarterback Roger Staubach, former Cowboys player Robert Shaw and current Cowboys owner Jerry Jones. With rents expected to begin at $2,700 per month, it’s been billed as the first luxury development catering to those Cowboys football diehards, with amenities including exclusive access to certain team facilities.
www.omegare.com
Apartment developers are experimenting with new and niche styles, amenities and features to keep project pipelines flowing and new buildings filled with renters, almost a decade into a national economic expansion that propelled the U.S. multifamily market to new heights.
Some developers are doubling down on luxury amenities in large floor plans, while others are emulating the so-called sharing economy with "micro" units built around shared living spaces. Some seek to create quiet getaways, and some meld their projects into larger mixed-use entertainment districts, increasingly tied to professional sports venues, or put them closer to public transit.
Based on input from CoStar analysts nationwide, and in no particular order, here are five apartment projects showing how developers are aiming to serve diverse customer priorities, while dealing with rising costs and other factors challenging their ability to get affordable new housing built.
Dwell at 2nd Street, Philadelphia (Developer: Klein Company)
Developer Klein Co. is betting on the prefab movement to help control costs at its newest project, a 320-unit complex (shown above) in Philadelphia’s emerging Olde Kensington neighborhood. Most of its apartments will be built from modular units prefabricated off-site, according to the developer.
Business consulting firm McKinsey & Co. reports that modular construction in the United States has accelerated project completion timeliness by 20 to 50%, while reducing construction costs by 20% or more. The practice is still relatively uncommon in the apartment industry but could soon show up more often in some markets.
"Philadelphia has some of the highest construction costs of any major U.S. market, and the modular approach is being used to expedite construction time and lower development costs," said Adrian Ponsen, a Philadelphia-based director of analytics for CoStar Group. "You’ll see more projects like these as developers look for innovative ways to maintain their returns in the face of rising construction costs over the long term."
Little has been announced about amenities at the site, which is scheduled to be completed in early 2020.
CitySpaces 500 Kirkham, Oakland, California (Developer: Panoramic Interests)
Higher-density, transit-friendly projects have steadily gained traction in major cities. CitySpaces takes the trend further. Tiny units help to create this massive 1,032-unit "micro-pad" apartment community on three acres in Oakland, California, by Panoramic Interests. The developer’s website notes that its trademarked MicroPad concept is a 160-square-foot, self-contained dwelling with a private bathroom and kitchenette.
The project, which is currently in entitlement phases, is designed to include three buildings made of steel modular units constructed off-site and assembled in place. Plans call for 59 parking spaces to be devoted to car-share services like Zipcar, and the development is adjacent to West Oakland BART station.
Units are stacked to create buildings up to 12 stories tall.
City Club Apartments, Minneapolis (Developer: City Club Apartments LLC)
City Club Apartments in Minneapolis provide an opportunity for residents to stay on the property and grow their accommodations as their financial or life situations change over time, offering a mini-pad for single residents and larger units for growing families.
Set for completion next month, the project is expected to bring the micro-unit concept to a downtown setting, targeting recent college graduates and other young renters. The site comprises 307 units, with about half of those measuring 407 square feet or less. The smallest units are around 360 square feet.
Notably, the complex is designed to have 100 units with one and two bedrooms to accommodate tenants who might eventually want to move beyond the base-sized unit to more roomy accommodations, said Michael Roessle, director of market analytics CoStar Group in Minneapolis.
The project is designed to have 24-hour amenities including a fitness center, conference and business center, and concierge services, outdoor pool, indoor and outdoor theaters and on-site restaurant.
There will be no parking, as many young renters in the urban core don’t own a car and prefer biking and ride-sharing to get to work at several large nearby employers.
Ten Thousand, Los Angeles (Developer: Crescent Heights)
From robot butlers to dog spas, the ultimate in luxury amenities are showcased at this Los Angeles apartment high-rise, which could influence other nearby developers to compete more lavishly for the same high-spending customers.
Opened in 2017 and a potential tone-setter for future surrounding projects, this 40-story tower has drawn national media attention as an example of ultra-high luxury, in a city that has no shortage of conspicuously posh housing arrangements. Located on the border of L.A.’s Century City and the city of Beverly Hills, it has two-bedroom units going for between $10,000 and $30,000 per month, with some penthouses going for double that higher-end figure.
Other developers with similar clientele could be looking to keep up with high-touch services that have included on-site space for botox treatments. The developer’s website points to features including a dog spa, a cold-storage package delivery facility for perishable items and a robot butler named Charley that delivers mini-bar items to residents.
Twelve Cowboys Way, Frisco, Texas (Developer: Columbus Realty Partners)
Renters can live, work and play all on the same property in this Texas development, with "play" in this instance referencing the growing trend of professional sports teams entering the commercial development arena to interact with fans well beyond game times.
Among the latest examples of teams getting into the field of apartment and mixed-use development near their facilities, this 17-story luxury tower is scheduled to open in 2020 next to the suburban headquarters of the National Football League’s Dallas Cowboys.
The project is spearheaded by a group that includes the Cowboys’ Hall-of-Fame former quarterback Roger Staubach, former Cowboys player Robert Shaw and current Cowboys owner Jerry Jones. With rents expected to begin at $2,700 per month, it’s been billed as the first luxury development catering to those Cowboys football diehards, with amenities including exclusive access to certain team facilities.
www.omegare.com
DePaul Healthcare Sells Senior Living Properties in New Jersey, Philadelphia
A New Jersey chain of senior assisted living facilities has sold three of its properties, one in the Garden State and two in Philadelphia, according to the broker on the deal.
DePaul Healthcare of Sewell, New Jersey, sold the portfolio to Paramount Health Resources, based in McMurray, Pennsylvania, for an undisclosed sum, according to CoStar data.
The three facilities inlcuded in the sale are:
The DePaul family, built and owned the communities for decades. At the time of the sale, the three facilities were operating at break-even, but Paramount plans to implement better marketing and services while "simultaneously creating staffing efficiencies, all of which will increase earnings," according to IPA.
Paramount – which owns and operates senior living facilities in New York, New Jersey, Pennsylvania and Maryland – completed the financing and closed the deal with the assistance of Lazmor Capital and Ziegler Investment Banking.
www.omegare.com
DePaul Healthcare of Sewell, New Jersey, sold the portfolio to Paramount Health Resources, based in McMurray, Pennsylvania, for an undisclosed sum, according to CoStar data.
The three facilities inlcuded in the sale are:
- Absecon Pavilion, which has 162 beds at 1020 Pitney Road in Absecon, New Jersey;
- Angela Jane Pavilion, a 49-bed home at 8410 Roosevelt Blvd. in Philadelphia;
- River’s Edge Nursing and Rehabilitation Center, which has 120 beds at 9501 State Road in Philadelphia.
The DePaul family, built and owned the communities for decades. At the time of the sale, the three facilities were operating at break-even, but Paramount plans to implement better marketing and services while "simultaneously creating staffing efficiencies, all of which will increase earnings," according to IPA.
Paramount – which owns and operates senior living facilities in New York, New Jersey, Pennsylvania and Maryland – completed the financing and closed the deal with the assistance of Lazmor Capital and Ziegler Investment Banking.
www.omegare.com
Metrix-Penwood JV Begins Construction on New Distribution Facility in Lawrenceville
by John Jordan Globest.com
A joint venture of Princeton, NJ Metrix Real Estate Services, LLC and Penwood Real Estate Investment Management, LLC of West Hartford, CT has acquired a 31-acre site here and started construction on a more than 340,000-square-foot distribution facility here.
The joint venture between Metrix Real Estate Services, whose principal is Michael Nachamkin, and an institutional fund managed by Penwood Real Estate Investment Management recently closed on the purchase of 10 Princess Road in Lawrenceville.
Brokers-Simone Realty represented the seller, Capital Health Systems and Transwestern of New Jersey handled negotiations for the purchaser. No financial terms of the transaction were disclosed.
The partnership has since commenced construction on the speculative 10 Princess Logistics development, a 340,400-square-foot distribution facility with 40’ clear ceiling heights, cross loading, trailer storage and abundant parking. The project is scheduled to be completed in the spring of 2020.
“Our development team is very excited about the opportunity to build a state- of- the- art warehouse in Central New Jersey with a great institutional partner,” says Nachamkin, principal of Metrix.
He adds, “We anticipate strong interest in the project from a variety of potential tenants who are planning their expansion or opening up a new location. 10 Princess Logistics Center is located at the Princeton Pike/ I-295 interchange and services Southern, Central and Northern New Jersey as well as the Philadelphia region.”
www.omegare.com
A joint venture of Princeton, NJ Metrix Real Estate Services, LLC and Penwood Real Estate Investment Management, LLC of West Hartford, CT has acquired a 31-acre site here and started construction on a more than 340,000-square-foot distribution facility here.
The joint venture between Metrix Real Estate Services, whose principal is Michael Nachamkin, and an institutional fund managed by Penwood Real Estate Investment Management recently closed on the purchase of 10 Princess Road in Lawrenceville.
Brokers-Simone Realty represented the seller, Capital Health Systems and Transwestern of New Jersey handled negotiations for the purchaser. No financial terms of the transaction were disclosed.
The partnership has since commenced construction on the speculative 10 Princess Logistics development, a 340,400-square-foot distribution facility with 40’ clear ceiling heights, cross loading, trailer storage and abundant parking. The project is scheduled to be completed in the spring of 2020.
“Our development team is very excited about the opportunity to build a state- of- the- art warehouse in Central New Jersey with a great institutional partner,” says Nachamkin, principal of Metrix.
He adds, “We anticipate strong interest in the project from a variety of potential tenants who are planning their expansion or opening up a new location. 10 Princess Logistics Center is located at the Princeton Pike/ I-295 interchange and services Southern, Central and Northern New Jersey as well as the Philadelphia region.”
www.omegare.com
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