Empire Realty had purchased the property for $8.1 million back in 1989. In 2020, Bensalem Shopping Center became subject to a $12.5 million CMBS loan originated by LMF Commercial, with Wilmington Trust as a trustee.

Anchored by Patel Brothers—the largest Indian grocery chain in the U.S.—Bensalem Shopping Center features a diverse mix of regional and national tenants such as Dollar General, Eggmania, Advance Auto Parts, Jack’s Cold Cuts, Smart Choice Pharmacy and Unlimited PCS, among others. The 1972-built property was fully leased at the time of sale.

The retail center occupies some 8.8 acres at 1961 Street Road, in an area where the daily traffic count reaches 32,600 vehicles, according to JLL. Downtown Philadelphia is roughly 18 miles away.

JLL Senior Managing Director Jim Galbally and Director Patrick Higgins led the Investment and Sales Advisory team working on behalf of Empire Realty.

Philadelphia’s retail scene

In 2024, the Philadelphia retail market experienced robust demand, resulting in a net occupancy increase of nearly 600,000 square feet, according to a recent CBRE report. Of the total, 480,000 square feet pertained to newly constructed space.

In line with national trends, this market faced challenges as well. However, the wave of retail store closures and bankruptcies created opportunities for in-demand retailers. Investor interest remained strong—especially for grocery-anchored centers.

By the end of last year, approximately 202,000 square feet of retail space was under construction. The vacancy rate clocked in at 7.5 percent, while rents averaged $19.17 per square foot, the same report shows.

The post Empire Realty Sells Philly Shopping Center appeared first on Commercial Property Executive.

FS Investments and Brandywine Realty Trust have entered a 16-year lease agreement for 117,000 square feet at 3025 JFK Blvd., a mixed-use tower within Philadelphia’s $3.5 billion Schuylkill Yards master-planned development.

The alternative asset manager is planning to relocate its global headquarters to the new space in early 2026. The company’s move from its current headquarters at Navy Yards will grow its footprint by 46 percent at 3025 JFK Blvd., where it has taken up four floors.

FS Investments has been in Philadelphia since its inception in 2007 and at Navy Yards since 2015. The company will bring its 300 local employees close to key transit connections at 30th Street Station, which is undergoing a large-scale restoration and renovation.

READ ALSO: What Defines the Best CRE Investments Today?

The 28-story mixed-use building at 3025 JFK Blvd. features 200,000 square feet of office space, a 29,000-square-foot indoor-outdoor amenity floor, 9,000 square feet of ground-floor retail and 18 floors of luxury residential. It also provides tenants and residents direct access to the newly expanded High Line Park.

Tactix Real Estate Advisors represented FS Investments in the transaction, according to The Real Deal. Last year, Goodwin Procter also signed a lease at the building, which is now 80 percent leased.

Schuylkill Yards’ progress

Last year, Brandywine Realty Trust and Drexel University topped out 3151 Market, a 435,000-square-foot 14-story life science building at Schuylkill Yards.

The tower at 3151 Market St. spans 14 acres in Philadelphia’s University City district. Offering 417,000 square feet of best-in-market lab and office space, 18,000 square feet of retail and amenity space, and 6,000 square feet of terrace space, it opened in 2024.

There are currently 65 office, life science and retail tenants at Schuylkill Yards. Upon completion at the end of the decade, the master-planned development is expected to total 6 million square feet of space across various property types.

Philadelphia’s office market performance

The prices for office space in Philadelphia decreased for the second half of 2024, according to CommercialEdge. Fundamentals did not improve over that time, with vacancy increasing by 510 basis points over the past 12-month period ending in October.

The muted supply pipeline had just 1.9 million square feet under construction. Four out of the five projects underway in October were life science assets, reinforcing the market’s emergence as a growing hub for the sector.

The post Brandywine Realty Secures Major Lease in Philadelphia appeared first on Commercial Property Executive.

Constructed between 1984 and 2000, the properties are currently 96 percent occupied. They provide easy access to the New Jersey Turnpike and downtown Philadelphia. Having a multiple-building setup and varying suite sizes, the portfolio also gives tenants significant growth flexibility.

Brennan will continue to operate the portfolio, which it bought in 2017. Since the acquisition, the company has upgraded the properties, including converting office space to industrial.

Philadelphia’s office market slowed and prices dropped in the fourth quarter, with vacancy rising 510 basis points over the past 12-month period ending in October, according to CommercialEdge.

Chris Massey, managing principal at Brennan Investment Group, said that strong demand and tight occupancies for small-bay suite sizes throughout the overall market have made the portfolio more attractive.

READ ALSO: Why Light Industrial Properties Will Continue to Shine

“Vacancy rates are low-single digits for this type of space, and there is basically no new construction due to high costs for building small footprint buildings,” he told Commercial Property Executive. “We believe our in-place rents are still significantly below where new leases are getting done.”

Brennan Investment Group’s portfolio totals approximately 56 million square feet across 29 states.

Philadelphia’s strong light-industrial demand

Marcus Partners’ Mid-Atlantic team has been acquiring portfolios of light industrial product in the suburban Philadelphia metro.

“The metro offers an expansive regional highway network and a deep labor pool and features exceptional population density and demographics,” Ryan McDonough, the company’s principal & CIO, told CPE.

The portfolios typically feature functional, Class B product needing physical repositioning and a diversified, multi-tenanted rent roll with shorter-term leases. “We are buying at a healthy discount to replacement cost with in-place rents that offer mark-to-market upside. This compelling risk-reward profile works across various economic scenarios, including a “higher-for-longer” rate environment,” McDonough added.

The post Brennan Recapitalizes 1 MSF Portfolio Near Philly appeared first on Commercial Property Executive.

American Real Estate Partners has obtained a four-year loan extension for 1600 Market St., an iconic 39-story, 825,968-square-foot office tower in Philadelphia’s Central Business District. The transaction, which also includes access to an increased future lease funding line, has ensured the full capitalization of the property.

Senior lenders Natixis Corporate & Investment Banking and BlackRock, along with mezzanine lender JPMorgan, extended the loan’s maturity through a complex financing structure. As part of the deal, AREP made a significant equity investment in the property. The firm declined to release the investment’s amount.

Natixis CIB provided the five-year, $162.5 million loan in February 2022 that refinanced the Class A property. AREP had acquired the tower in February 2018 from Equity Commonwealth for $160 million.

READ ALSO: Philadelphia Office Prices Drop, Construction Slows

Peter Bayard, managing director at Natixis CIB, was involved in arranging the new transaction.

“The loan extension ensures the long-term financial stability of the property, which is a significant advantage relative to the challenges other projects are facing in today’s commercial real estate market. Our partnership highlights the strength and confidence AREP and our senior lenders, Natixis, BlackRock and JPMorgan, all have in the property’s future,” Brian Katz, co-founder & president of AREP, told Commercial Property Executive.

Katz said the extended funding also gives AREP the resources to maintain 1600 Market’s position as a trophy building and continue attracting high-quality tenants seeking superior properties with stable owners that can perform.

Tenant roster growing

PNC Bank, which has its regional headquarters at the property, is the anchor tenant at the building that is currently 70 percent leased. PNC has committed to 233,411 square feet through May 2031, according to CommercialEdge data.

Recent lease transactions include HNTB—which is occupying 38,375 square feet—Lockton Insurance and Your Part Time Controller, according to AREP. Other tenants include Security Risk Advisors, which leases 21,687 square feet, Stifel, NorthMarq Advisors, Gallagher Law, Crum & Forster and AEGIS insurance firm, the same source reveals.

Focus on amenities

The Center City tower is one block from the Philadelphia City Hall and two blocks from JFK Plaza. Completed in 1982, the building features floorplans of 23,000 square feet and seven elevators, CommercialEdge shows, as well as 10,000 square feet of retail space.

AREP’s $15 million, multi-year renovation of the property was completed in January 2021. The high-rise features at least 8,000 square feet of amenities including collaboration space, conference rooms, wellness and fitness areas and a coffee bar from Elixr, a local favorite. The building has received recognition for its tenant experience app—AREPx—and for the amenity floor design and use of pop art.

The post AREP Gets Loan Extension on Philly Office Tower appeared first on Commercial Property Executive.

The property at 700 Haddonfield-Berlin Road in New Jersey’s Voorhees Township was built in 1976 and features nearly 40 retailers and restaurants, including Acme Markets, Ross Dress for Less, Five Below, Chipotle and Ace Pickleball Club.

Eagle Plaza is surrounded by a population of about 240,000 residents within a five-mile radius, including some 95,000 households with an average income nearing $145,000.

Brad Nathanson and JP Colussi of Institutional Property Advisors represented the buyer and the seller in this transaction.

KPR’s expanding portfolio

With a portfolio of approximately 10 million square feet of retail space across 18 states, KPR has been on the acquisition trail this year.

In the fall, the company entered the Colorado area with the $56.5 million purchase of Denver’s University Hills, a 210,000-square-foot grocery-anchored center.

In March, KPR Centers purchased a 1.5 million-square-foot retail portfolio in Florida and the Midwest for $180 million. Kimco Realty Corp. was the eight assets’ previous owner, according to CommercialEdge data.

Located in Wisconsin, Florida, and Missouri, the retail centers feature national and regional retailers including Michael’s, Marshalls, Dick’s Sporting Goods, The Fresh Market and Ross Dress for Less.

Other firms are looking to invest in New Jersey properties as well. In October, a fund managed by DRA Advisors, in conjunction with Soundwater Properties, acquired a three-property, 376,462-square-foot shopping center portfolio in Ocean County, N.J. A ShopRite store anchors each center. Pasbjerg Development Co., the properties’ developer and manager, sold them in a transaction arranged by CBRE.

The portfolio comprises Lacey Mall at 344 US-9 in Lacey Township, Jackson Plaza at 260 N. County Line Road in Jackson Township and Bay Plaza at 860 Fischer Blvd. in Toms River.

The post KPR Centers Pays $42M for Philadelphia-Area Mall appeared first on Commercial Property Executive.

Prices for office space in Philadelphia continued to decrease in the second half of the year. The market’s fundamentals did not show signs of improvement, with vacancy ballooning 510 basis points over the past 12-month period ending in October, CommercialEdge data shows.

The supply pipeline remained muted, with only 1.9 million square feet under construction. Four out of the five projects underway in October were life science assets, signaling the market’s status as an up-and-coming hub for the sector.

Philadelphia’s life science sector expands

Philadelphia had 1.9 million square feet of office space under construction as of October. This amount represented 1.1 percent of the market’s existing stock—20 basis points above the national figure.

Compared to its peer markets, Philadelphia was ahead of Phoenix (0.4 percent of stock underway), Houston (0.7 percent) and Charlotte, N.C. (0.9 percent), but lagged San Diego (3.2 percent) and Nashville (3.5 percent).

The largest project underway is Parkway Corp.’s 2000 Arch St., a 550,000-square-foot building in the Logan Square neighborhood. The asset is a build-to-suit for Chubb, for which the developer obtained $409 million in credit tenant lease financing last year.

The other four developments are all life science assets. Brandywine Realty Trust and Drexel University topped out 3151 Market St. in October last year—a 435,000-square-foot building that is part of the $3.5 billion Schuylkill Yards master plan. At 3001 Chestnut St., Spark Therapeutics is constructing its future center for gene therapy manufacturing, which will include office space—also part of the same master plan.

The remaining two are a 350,000-square-foot facility under construction for Children’s Hospital of Philadelphia, set to open in 2025 and include laboratory space; and 3201 Cuthbert St., under construction by Gattuso Development Partners and Vigilant Holdings of New York. The latter is a 519,647-square-foot life science property for which the duo obtained $290 million in construction financing in late 2022.

Developers completed 932,303 square feet of office space across five buildings in Philadelphia year-to-date through October. Deliveries in the metro were down 35.4 percent year-over-year—in line with national trends—and accounted for 0.4 percent of existing stock. All completions were in the first half of the year.

Office-to-residential conversions garner interest

As a response to rising interest for office-to-residential conversions, CommercialEdge created the Conversion Feasibility Index (CFI)—powered by Yardi—which measures a building’s potential to be transformed into multifamily rental units.

The CFI score has three tiers, with Tier 1 buildings being the most likely candidates. Philadelphia had 43 assets—roughly 5.6 million square feet—that fell in the Tier 1 range, as of October. An additional 165 buildings were Tier 2, approximately 26.8 million square feet.

Among the largest of these is 1701 Market St., a 929,124-square-foot high-rise that will be converted into 299 rental apartments. Alterra Property Group secured a $70 million construction loan from Bank OZK for the project, slated for completion in Spring 2025. The property has a CFI score of 96, marking its high potential for conversion.

Gazit Horizons is redeveloping the 76,500-square-foot Art Deco building at 1618-1622 Chestnut St. The owner is planning to bring 67 units online throughout the seven floors currently occupied by office space.

Average price lags peer markets

Investors traded $316 million in assets across the metro year-to-date through October. Office space in Philadelphia continued to change hands at a below-average price per square foot, $83. Meanwhile, the U.S. figure clocked in at $177.

Philadelphia also ranked last among its peer markets when it came to the average price, below Houston ($104), Charlotte ($151), Phoenix ($164), Nashville ($193) and San Diego ($198).

The largest transaction remained Incyte’s $34.2 million purchase of the office asset at 1100 N. King St. from Capital Commercial Investments. The pharmaceutical company also bought the property at 1100 N. French St., for $13.3 million, from the same buyer.

KKR sold the 267,597-square-foot asset at 111 S. Independence Mall E for $31 million to Lubert-Adler—the second largest transaction year-to-date through October. The Bourse building was constructed in 1895 and served as the nation’s first commodities exchange market. It underwent two rounds of complete renovations—in 2012 and 2018—and now houses 20,000 square feet of retail and nine floors of office space.

Vacancy grew, but stabilized below U.S. average

Philadelphia’s overall vacancy stood at 18.9 percent as of October, below the 19.4 percent national figure. However, the metro’s rate increased by a whopping 510 basis points year-over-year, while the U.S. average was up 160 basis points.

Compared to its peer markets, Philadelphia’s vacancy stood somewhere in the middle—higher than Charlotte (16.4 percent), Nashville (17.5 percent) and Phoenix (18.4 percent), but below San Diego (20.6 percent) and Houston (24.3 percent).

Not many significant deals took shape across the market. In September, Potter Anderson & Corroon LLP renewed its 82,757-square-foot lease at 1313 N. Market St. in Wilmington, Del., which it will use as its headquarters for another 13 years. The Siegfried Group owns the 530,000-square-foot building.

Earlier in November, Rubenstein Partners signed Arcfield at its Chesterbrook Corporate Center in Wayne, Pa. The new tenant will occupy 36,000 square feet in total—the entire third floor and part of the first floor. The asset at 1400 Morris Drive is part of a 1.1 million-square-foot campus.

Philadelphia’s expanded coworking inventory

In October, Philadelphia had around 2.8 million square feet of office space dedicated to coworking. This was 1.5 percent of the market’s total inventory, 40 basis points below the national figure. Compared to its peers, Philadelphia stood at the bottom, outpaced by Phoenix (1.9 percent), Charlotte (1.9 percent), San Diego (2.1 percent) and Nashville (3.5 percent).

Despite lagging peer markets, Philadelphia’s amount of shared space locations grew considerably, up 9 percent from the second to the third quarter, according to a recent report from CoworkingCafe. This brought the total to 150 coworking locations. The metro also had a below-average median price for monthly rates for open workspaces, at $119 in September.

The post Philadelphia Office Prices Drop, Construction Slows appeared first on Commercial Property Executive.

Nuveen Real Estate has purchased The Shoppes at English Village, a 103,325-square-foot retail center in North Wales, Pa. MetLife Investment Management sold the asset in a transaction brokered by CBRE.

MetLife had acquired the retail center back in 2017 from Stanbery Development for $57 million, according to CommercialEdge data. CBRE brokered that transaction as well.

The Shoppes at English Village came online in 2003 on some 13 acres. Anchored by Trader Joe’s, The Shoppes at English Village features a diverse mix of regional and national retailers such as LensCrafters, Sephora, Athleta, Sport Clips, CycleBar, Hallmark, The Good Feet Store and Talbots, among others.

The property also features 5,000 square feet of built-out restaurant space with a Montgomery County Liquor License. The lifestyle center was 95 percent leased at the time of sale.

READ ALSO: Retail’s Post-Pandemic Recovery

Located at 1460 Bethlehem Pike, the lifestyle center is in Montgomery County, a well-performing area in the suburban Philadelphia region. More than 50,400 people live within a 3-mile radius; the area has an average household income of some $190,000, according to CBRE brochure.

CBRE Executive Vice Presidents Chris Munley and Ryan Sciullo, Senior Vice President Colin Behr and Vice President Casey Benson Smith, together with Associates RJ Mirabile and Michael Pascavis, brokered the transaction on behalf of the seller. In addition, Director Adam Spengler and Vice Chair Tom Traynor secured the financing for Nuveen.

Another CBRE team recently arranged a $69.4 million construction loan for Nuveen and SJC Ventures. The partners are developing an 83,329-square-foot shopping center in Doral, Fla.

Philly sees positive net absorption first time this year

Greater Philadelphia’s retail market recorded a positive net absorption for the first time this year, according to a recent third-quarter CBRE report. Grocery-anchored and experiential retail continue to drive demand in the area, with the metro recording approximately 357,000 square feet of retail space under construction.

The market is facing limited options for quality retail space, but also experiences renewed activity due to the bankruptcies and store closures that plagued Big Lots and LL Flooring. The vacancy rate in the metro clocked in at 7.4 percent at the end of September.

The post Nuveen Buys Philly-Area Shopping Center appeared first on Commercial Property Executive.

Brandywine Realty Trust has signed a 119,000-square-foot lease at 250 Radnor, a life science and office building in Radnor, Pa., a Philadelphia suburb. The tenant is a global industrial solutions company.

The 168,000-square-foot property is the adaptive reuse of a former medical office building. The facility, designed to fully accommodate lab tenants such as West Pharmaceutical, Quanta Therapeutics and Penn Medicine, is now fully leased.

Design firm NORR oversaw the repositioning project that was completed in 2022. Building additions comprised a coffee bar and lounge, a redesigned lobby and multiple healthy building practices.

READ ALSO: How AI Firms Are Reviving Office Space Demand

Brandywine Realty Trust acquired the asset in January 2021 from Penn Medicine, according to CommercialEdge information. The company paid $20.3 million—or $81 per square foot.

The four-story facility originally came online in 1989. The mid-rise features floorplates averaging 25,370 square feet and 250 parking spaces. Located at 250 King of Prussia Road, the building is about 18 miles from downtown Philadelphia and 21 miles from the city’s international airport.

The property is also part of the Radnor Life Science Center, a 26.6-acre complex consisting of four Class A life science buildings totaling nearly 1 million square feet. Brandywine recently completed 155 Radnor, a 145,000-square-foot office building that is already fully leased to Arkema S.A., a global supplier of specialty materials.

Philly vacancy rates on the rise

Metro Philadelphia’s office vacancy rate at the end of September clocked in at 17.8 percent, up 380 basis points year-over-year, but below the 19.5 percent national figure, according to a CommercialEdge report. The market fared better than New Jersey (20.2 percent), while Boston (16.4 percent) and Manhattan (16.8 percent) had less vacant space.

Earlier this fall, law firm Potter Anderson & Corroon LLP renewed its headquarters commitment at 1313 N. Market St., a 530,000-square-foot property in Wilmington, Del. The company will occupy the 82,757-square-foot office space for another 13 years.

And, more recently, Arcfield committed to 36,000 square feet at Rubenstein Partners’ Chesterbrook Corporate Center, a 14-building office campus spanning 1.1 million square feet, also in Wayne, Pa. The company is the first to take space at the recently upgraded property, located some 9 miles northwest of 250 Radnor.

The post Brandywine Lands 119 KSF Office Tenant appeared first on Commercial Property Executive.

Rubenstein Partners has added Arcfield as a tenant at Chesterbrook Corporate Center, a 14-building office campus totaling 1.1 million square feet in Wayne, Pa.

The government technology and mission support provider signed a 36,000-square-foot, long-term lease and will occupy the entire third floor and a part of the first floor at 1400 Morris Drive. The four-story building encompasses some 239,600 square feet.

The company is the first tenant to take space at the recently upgraded property. The deal also represents Arcfield’s first office move in the Philadelphia area in decades.

JLL worked on behalf of the landlord, while Cushman & Wakefield represented Arcfield. Other notable tenants at Chesterbrook Corporate Center include Aclaris Therapeutics, The Higgins Group Inc. and Navigate Corp., among others, according to CommercialEdge.

An upgraded Philly-area office complex

Rubenstein Partners picked up Chesterbrook Corporate Center in 2019. Pitcairn Properties sold the asset for $147 million, according to the same source.

The owner completed a series of capital improvements at the entire office complex. Upgrades included the construction of The Circuit, a two-story, 41,331-square-foot amenity center that also features 20,000 square feet of coworking space, as well as the addition of as touchless technology and HVAC improvements. The office buildings underwent interior and exterior renovations as well.

Completed in 1982, the property at 1400 Morris Drive has four passenger elevators, 29,700-square-foot floorplates and 1,088 vehicle parking spots. Upgrades feature new curtain glass walls at the front and rear entrances and an expanded first-floor lobby, among others.

The 140-acre campus is just north of U.S. Route 202 and close to Interstate 76. The location is 22 miles of downtown Philadelphia and 29 miles from Philadelphia International Airport.

Office vacancies on the rise in Philly

JLL’s team of Executive Vice Presidents Doug Newbert and Mike MacCrory, together with Senior Vice President Whitney Hunter, assisted the landlord during negotiations. Senior Director John Shelly and Director Gina Brennan with Cushman & Wakefield represented the tenant.

The deal closed at a time of consistent leasing momentum for Chesterbrook Corporate Center. The property has seen approximately 100,000 square feet of new leases and renewals closed over the past months.

However, the metro witnessed a rise in office vacancies. The rate clocked in at 17.8 percent as of September, up 380 basis points over the year, according to a recent CommercialEdge report. Nonetheless, the index remained below the national average of 19.5 percent.

In September, JLL brokered a 82,757-square-foot renewal in Wilmington, Del. Law firm Potter Anderson & Coroon LLP signed a 13-year deal to keep its headquarters at a 530,000-square-foot office building owned by Siegfried Group.

And, in early 2024, Dow signed a 800,000-square-foot extension at a 1.9 million-square-foot campus in Collegeville, Pa. Newmark represented the tenant.

The post Rubenstein Partners Inks Philly-Area Office Lease appeared first on Commercial Property Executive.

An affiliate of Velocity Venture Partners, Bala Cynwyd, Pa., has sold a 450,000-square-foot industrial building in Yeadon, Pa., near Philadelphia, for $59 million. Newmark arranged both the sale to an undisclosed buyer and the acquisition financing.

The Class C property at 6250 Baltimore Ave., known as Yeadon Industrial Center, was completed in 1955, according to CommercialEdge data. Nonetheless, the recently renovated property is 96 percent occupied, Newmark reported. A recent addition to the tenant roster, CommercialEdge indicates, was Peak Supply Chain Solutions, for about 80,000 square feet.

READ ALSO: E-Commerce Growth Revives Industrial Market

6250 Baltimore Ave. is a small-bay infill industrial property in Delaware County, which Newmark reported is an in-demand Philadelphia submarket with high barriers to entry and close proximity to Philadelphia and southern New Jersey.

The property has a 24-foot clear ceiling height, more than 80 loading docks, and a truck court depth of 125 feet with secure outdoor storage space and trailer parking on the 26.6-acre site.

Newmark Managing Director Ryan Guittare led the sales team’s efforts, and Executive Managing Director Jim Badolato and Associate Adam Rudman, of Newmark’s Philadelphia-based Debt & Structured Finance group, secured acquisition financing on behalf of the buyer. Newmark Analyst John Cook provided support on the transaction.

Velocity focuses strictly on owning, acquiring and developing industrial properties, as well as conversions to industrial uses. The company currently owns and manages more than 8 million square feet of industrial space in the Greater Northeast.

Balancing out

The Greater Philadelphia industrial space market has seen a substantial recent decline in deliveries, to less than half of the quarterly average over the past two years, according to a Newmark report. Fortunately, this has coincided with a lull in demand, while sublease availability has begun to decrease, after rising for six straight quarters.

According to Newmark Research, the industrial vacancy in Delaware County is just 5.6 percent, a good bit lower than the Greater Philadelphia average of 7.6 percent.

In July, DH Property Holdings LLC, of New York, received a $53.8 million construction loan for its PhilaPort Logistics Center from ACORE Capital, in a deal arranged by Walker & Dunlop. The 282,250-square-foot last-mile warehouse and distribution center is under construction on a 15-acre site at 3060 S. 61st St. in Philadelphia. The project is scheduled to deliver in the third quarter of 2025.

The post Venture Velocity Sells Vintage Property for $59M appeared first on Commercial Property Executive.

Lovett Industrial has broken ground on Highway 1 Commerce Center, a 176,105-square-foot speculative development in Philadelphia focused on the need for Class A last-mile space near major highways.

A Cushman & Wakefield Debt and Equity team led by Vice Chairman John Alascio helped secure construction financing for this project, a $22.6 million loan from First Citizens Bank.

Having BSI Construction as general contractor, the warehouse is slated for delivery by the third quarter of 2025.

READ ALSO: Top 5 Markets for Industrial Deliveries

Lovett acquired the land for Highway 1 Commerce Center in November 2023. The 14.5-acre site at 11301 E. Roosevelt Blvd. has direct access to downtown Philadelphia and the broader market via Highway 1 and Pennsylvania Turnpike, as well as quick access to Interstate 95.

Upon completion, the warehouse will feature a 280-foot building depth, 36-foot clear height, 28 dock doors, two drive-ins, 131 car parks and 25 trailer parks. The industrial facility will be aimed at a wide range of tenants seeking space from 75,000 to 176,105 square feet. Cushman & Wakefield Executive Managing Director Jonas Skovdal and Director Chris Butera spearhead the marketing and leasing efforts at the property.

“There is significant demand for well-located industrial space with both quick access to major arterials for regional users as well as easy access to the Philadelphia metro for local-serving users. There has been a lack of new construction in these infill locations due to the scarcity of available land, which has led to this outsized demand for small infill product. We are excited to be able to add some much-needed Class A supply to this market,” Ben Swift, Lovett’s Northeast U.S. market leader told Commercial Property Executive.

“One of the great things about the Philadelphia market is the wide variety of tenants who serve the local metro area and are in need of space. These include various types of light manufacturing and assembly, local and regional distributors, and many others,” Swift said.

Strong tenant demand for Philly industrial spaces

Cushman & Wakefield’s second quarter 2024 industrial report for the market stated tenant demand has been strong since the beginning of the year. Some 4.1 million square feet were leased up through the first half of the year, up 39.4 percent on a year-to-date basis.

The report noted the surge came from a 168.7 percent increase in Southern New Jersey’s leasing volume, making up 85.2 percent of the Philadelphia’s total market, similar to trends seen during the pandemic.

Seven new transactions greater than or equal to 100,000 square feet closed during Q2. The average overall vacancy rate for the market rose by 90 basis points to 9.2 percent quarter-over-quarter, primarily driven by upticks in Delaware and Salem counties.

Asking rents in the Philadelphia region are expected to see moderated growth or potential stabilization, according to the report. Vacancy rate increases are to taper off as new deliveries slow and construction starts remain tempered. Cushman & Wakefield anticipates users in the market will continue to seek out premium space and greater Philadelphia will remain a top-tier market for industrial investment.

Lovett U.S. activity

Founded in 2020, Lovett Industrial is active in more than 15 markets across the nation. The firm’s industrial portfolio comprises approximately 16 million square feet of completed, acquired and under-construction warehouses and more than 10 million square feet of facilities planned for future development.

In July, Lovett secured entitlements to develop Schaefer Logistics Center, a 298,000-square-foot industrial project in Chino, Calif., within the Inland Empire West submarket. The company had acquired the development site for $40 million last year, according to public records. Completion is expected by the end of next year.

Also this summer, Lovett completed construction of Broadway Logistics Center, a 201,329-square-foot Class A rear-load industrial building in Denver. The firm had broken ground on the speculative project in 2022.

The post Lovett Breaks Ground on Philly Last-Mile Project appeared first on Commercial Property Executive.

PCCP has acquired Hamburg Logistics Center, a 518,140-square-foot warehouse and distribution facility in Hamburg, Pa., a Philadelphia submarket.

The company paid $57.5 million for the asset and took out a $46.4 million loan from Heitman Capital Management, with a maturity date set for 2027, according to public records.

A joint venture between Transwestern Development Co. and QuadReal Property Group sold the facility. JLL Capital Markets brokered the deal on behalf of the seller and arranged the acquisition financing.

The cross-dock facility came online in 2021 and was vacant at the time of sale. The building has 40-foot clear heights, 100 dock-high loading doors, four drive-in doors, 294 car parking spaces, 126 trailer stalls and 185-foot truck courts. The Class A warehouse also has 60-foot speed bays and about 2,740 square feet of office space.

READ ALSO: Top Mid-Atlantic Markets for Industrial Transactions

Located at 3501 Mountain Road, the 64-acre property provides direct access to Interstate 78 and is 89 miles from downtown Philadelphia. Newark International Airport and the Port of New Jersey and New York are 116 miles away.

JLL Investment Sales and Advisory team comprised Senior Managing Director John Plower, Director Ryan Cottone and Associate Zach Maguire, alongside Vice Chairs Jeff Lockard and Paul Torosian. Senior Managing Directors Chad Orcutt, Jon Mikula and Jim Cadranell arranged the acquisition financing.

Philadelphia’s recent industrial transactions

Philadelphia registered $277 million in industrial transaction volume year-to-date as of July, according to the latest CommercialEdge report. Assets in the metro changed hands for $107 per square foot on average, below the $135 national figure. Additionally, the metro’s vacancy rate clocked in at 5.2 percent.

In August, Link Logistics sold 240 Mantua Grove Road, a 652,411-square-foot industrial facility in West Deptford, N.J. The property traded for $90.8 million—or $139.18 per square foot—CommercialEdge information shows. KKR acquired the asset with help from a $46 million loan originated by Global Atlantic Financial Group.

The post PCCP Acquires 518 KSF Facility for $58M appeared first on Commercial Property Executive.

Law firm Potter Anderson & Corroon LLP has renewed its headquarters commitment at 1313 N. Market St., a 530,000-square-foot office building in Wilmington, Del. The company will continue to occupy the 82,757-square-foot space for another 13 years.

JLL Executive Vice President Jamie Vari and Potter Anderson Partner Joy Barrist arranged the deal on behalf of the tenant.

The Siegfried Group is the owner of the 1984-completed property, according to CommercialEdge information. The company acquired the asset in 2017 from The McConnell Cos., after the previous owner defaulted on a $79 million acquisition loan.

READ ALSO: CRE Veterans Offer Advice to Would-Be Brokers

The law firm moved to the Class A property in 1997 and is currently the building’s largest tenant, occupying the entire sixth and seventh floors. As part of the new agreement, the company also plans to redesign and modernize its office space, with completion scheduled for 2026. The renovation program will feature a revamped suite for visiting trial teams and enhanced amenities, among other improvements.

A fully renovated office building

Also known as Hercules Plaza, the 12-story building went through a complete renovation in 2013. The mid-rise features column-free floorplates measuring more than 47,000 square feet, a tenant conference center and a food court, as well as the 1313 Innovation Center, a tech incubator providing 3D printing and coworking space.

Additionally, the ownership intends to upgrade the building amenities over the coming years. Plans call for additional coworking space, an upscale fitness center and a boutique lifestyle hotel.

Located within the city’s business district, the property is some 8 miles from the Wilmington Airport. Downtown Philadelphia is 32 miles northeast.

Law firm office leasing remains strong nationwide

Law firm office leasing activity continued to rise this year, with lease terms trending longer, according to a Savills report. In the first quarter of this year, the legal sector’s leasing activity clocked in at 1.7 million square feet, slightly ahead of the 1.5 million-square-foot quarterly average since 2020.

This week, law firm Smith, Gambrell & Russell decided to relocate its Chicago office to 57,000 square feet at 155 N.  Wacker Drive, an approximately 1.2 million-square-foot office tower in Chicago. Move-in is scheduled for early 2026.

Other notable deals included Williams Mullen’s lease extension at 200 S. 10th St. in downtown Richmond, Va. The law firm upped the remaining term at the 148,911-square-foot space for another seven years.

The post Law Firm Renews 83 KSF Office Lease Near Philly appeared first on Commercial Property Executive.

The joint venture of RealtyLink LLC division RL Cold and BentallGreenOak has broken ground on a 215,766-square-foot speculative cold storage warehouse in Mount Laurel, N.J. Greek Design|Build, of East Brunswick, N.J., serves as general contractor. Completion is expected in the second half of next year, according to TAPinto.

Aiming to achieve a LEED certification, the facility will use a modern CO₂ refrigeration system and have the ability to accommodate temperatures ranging from –10 degrees Fahrenheit to 55 degrees Fahrenheit, with four variable-temperature compartments. Other features are to include a dedicated USDA inspection area, 27 dock positions outfitted with a sanitary dock pit, vertical dock levelers and vehicle truck restraints, as well as a 5,000-square-foot storage mezzanine.

The warehouse rises at 907 Pleasant Valley Ave. on a 12-acre site of a former office building, NJBIZ reported. The location is just off Interstate 295 and roughly 13 miles from downtown Philadelphia.

READ ALSO: Cool Heads for Cold Storage

In May, RL Cold broke ground on a 292,000-square-foot design-build cold storage facility in Lakeville, Minn., near Minneapolis. Ware Malcomb provided design services and Graycor Construction Co. is the general contractor. Delivery is expected next spring.

A significant factor behind demand for temperature-controlled storage facilities is a surge in online grocery sales, according to a recent report from Marcus & Millichap.

Over the 2019–2023 period, online’s share of total grocery shopping grew to a record high of more than 16 percent, which is expected to rise even further. Beyond that, exports of U.S. agricultural products are an additional factor in the sector’s expansion.

The post RL Cold, BGO Break Ground on Philly-Area Cold Storage Facility appeared first on Commercial Property Executive.

DH Property Holdings LLC, of New York, has received a $53.8 million construction loan for its PhilaPort Logistics Center. ACORE Capital provided the funds in a deal arranged by Walker & Dunlop.

The 282,250-square-foot last-mile warehouse and distribution center is currently under development on at 15-acre site at 3060 S. 61st St. in Philadelphia. The project broke ground earlier this month and is scheduled to deliver in the third quarter of 2025.

Designed to achieve a LEED Silver certification, PhilaPort Logistics Center will feature 40-foot clear heights, a 330-foot building depth, 135-foot truck court depth, 50 exterior dock doors, two drive-in doors, 72 trailer parking stalls and 187 car parking stalls. The rear-load building will also include about 5,000 square feet of speculative office space.

READ ALSO: Top 5 Metros for Industrial Deliveries

The property is 2.9 miles from the Philadelphia International Airport, 3.8 miles from Center City and 6 miles from the Packer Avenue Marine Terminal. Chris Pennington of Binswanger and Jonas Skovdal of Cushman & Wakefield will be leading the leasing activity for the facility.

Walker & Dunlop’s New York Capital Markets team, led by Aaron Appel, Jonathan Schwartz, Keith Kurland, Adam Schwartz and Michael Ianno, arranged the financing.

Just a year ago, DH Property Holdings landed a $175 million financing package for 5000 Richmond St., a 750,000-square-foot last-mile distribution project in Philadelphia. In that deal, too, Walker & Dunlop arranged all of the funding: a $135 million construction loan from Massachusetts Mutual Life Insurance Co., plus $40 million in partner equity.

Stable vacancy across Philadelphia’s industrial market

The metro Philadelphia industrial market is characterized currently by a stable vacancy of 6.7 percent, though construction starts have declined because of “higher interest rates, available inventory, and the impending arrival of 13.9 million square feet of new space by mid-2024,” according to a first-quarter report from Cresa.

Cresa also notes that Philadelphia, like some other East Coast ports, is benefitting—sadly—from container traffic being diverted from Baltimore, where the Francis Scott Key Bridge collapsed on March 26. As things now stand, the design-build team for the replacement bridge should be chosen by late summer, and the target for completing the new bridge is October 2028.

The post DH Property Holdings Gets $54M for Philly Industrial Project appeared first on Commercial Property Executive.

Philadelphia’s office market remained on a relatively stable trajectory, considering ongoing headwinds, such as debt maturity and rising vacancy rates. According to the latest CommercialEdge data, Philly developers were working on adding 1.1 percent of existing stock to the inventory as of May.

Meanwhile, investment in the first five months of the year declined to less than half of the volume recorded in the same period last year, while vacancy increased 200 basis points, but remained below the national average.

The most significant office lease was an extension, while one of the largest properties to come online was a medical outpatient facility in the CBD. Read on for our in-depth report for the first five months of this year.

Philly development outpaces some peer markets

As of May, Philadelphia had 2.1 million square feet of office space under construction, which represented 1.1 percent of existing stock—just 10 basis points below the national figure. Compared to similarly sized secondary markets, Philadelphia outpaced Houston (0.8 percent of stock underway) and Phoenix (0.3 percent), while Charlotte (2.3 percent) and Nashville (4.6 percent) remained ahead.

The largest office development in Philadelphia is Parkway Corp.’s 2000 Arch St., taking shape in the Logan Square neighborhood. The 550,000-square-foot property will serve as a consolidated headquarters for Chubb. Last year, Parkway obtained $409 million in credit tenant lease financing for the project. Completion is slated for early 2026.

Developers broke ground on four properties totaling 976,260 square feet in the first five months of the year. This was down to less than half of the 2 million square feet of office space that broke ground in the same period last year across six properties.

READ ALSO: NAREE Special Report: Why Conversion Isn’t CRE’s Magic Bullet

Three properties came online in the market year-to-date through May, encompassing 647,303 square feet. The largest of these was the 462,000-square foot Jefferson Honickman Center in the CBD. The 19-story medical outpatient facility cost $762 million to develop and its construction took four years.

Another significant asset that came online during this time was the 105,303-square-foot Walkers Mill, in suburban Wilmington, Del. The building is part of Pettinaro’s 56-acre mixed-use Barley Mill project, which includes 38,700 square feet of retail, 80 luxury apartments and 33 townhomes.

Vacancy grows, but maintains below the nation’s average

Philadelphia’s office market saw its overall vacancy increase by 200 basis points year-over-year, to 15.3 percent as of May. Although growing, the figure remained below the 17.8 percent national rate. It also lagged peer markets Charlotte (14.7 percent) and Nashville (15.0 percent). Meanwhile, Phoenix (18.2 percent) and Houston (22.5 percent) had higher vacancy rates.

A significant lease deal that took shape in the first five months of the year was an extension. Dow, a materials science company signed a long-term agreement for 800,000 square feet in Collegeville, Pa., at Northeast Dow Center. The 1.9 million-square-foot office, life science and mixed-use campus is owned by a joint venture of David Werner Real Estate Investments and GreenBarn Investment Group.

Tech markets have been severely impacted by industry headwinds that started at the end of 2022, and vacancy in these areas mirrored this, according to the latest CommercialEdge national office report. San Francisco suffered a severe 510-basis-point increase year-over-year, to 25.5 percent as of May, while Seattle’s rate grew 350 basis points, to 23.0 percent.

Investment drops below half year-over-year

Investors traded $145 million in office assets across the metro year-to-date through May, 58.9 percent less year-over-year. More than 2 million square feet of office space changed hands, down from the 2.6 million square feet recorded in the same period last year.

These properties traded for an average price per square foot of $90 as of May, down 44.4 percent year-over-year—below the nation’s $165 figure. Philadelphia also lagged peer markets like Charlotte ($121 per square foot), Houston ($125), Phoenix ($191) and Nashville ($227).

Philadelphia’s two largest office deals were both in suburban Wilmington and had the same buyer. Global pharmaceutical company Incyte acquired the office assets at 1100 N. King St. and 1100 N. French St., for $34.2 million and $13.3 million, respectively. Capital Commercial Investments sold both assets, which measure a combined 501,553 square feet.

Three other office deals valued at more than $10 million closed in the metro year-to-date through May. Notably, LCN Capital Partners acquired the asset at 311 Veterans Way in Levittown, Pa., for roughly $121 per square foot. The 90,371-square-foot property was a retail-to-office adaptive reuse, redeveloped in 2002.

Peer markets outpace Philly’s shared space totals

Philadelphia’s shared office space inventory comprised more than 2.5 million square feet as of May, which represented 1.4 percent of total rentable office space. This share was smaller than the national average of 1.8 percent. Similarly sized metros remained ahead of Philadelphia with slightly larger shared office space segments—Houston with 1.7 percent of stock, Atlanta (2.1 percent), Charlotte (1.5 percent) and Nashville (3.0 percent).

Regus was Philadelphia’s largest coworking provider, with roughly 445,000 square feet of space across 24 locations. Other significant players included Industrious (122,775 square feet) and Convene (87,700 square feet).

The post Philadelphia’s Office Market Maintains Stable Course appeared first on Commercial Property Executive.

As part of a nationwide wave of growth among experiential retail, Simon Property Group is expanding its offerings, inking a deal with Camp to open two new locations at Simon shopping centers—including King of Prussia Mall. Separately, the company previously struck a deal with Netflix to open one of the steaming service’s new experiential concepts at the same King of Prussia, a Greater Philadelphia Simon property.

Beside the King of Prussia location, which will open this year, Camp and Simon also plan a new experience at the Galleria Mall in Houston, for 2025. Both spaces will exceed 10,000 square feet.

Earlier this year, Simon also inked a deal with Netflix to include a Netflix House concept in 2025 at the King of Prussia Mall. The concept was created by the streaming giant as a retail, dining and live entertainment venue. Another Netflix House location will open soon at Galleria Dallas, which is currently owned by Metropolitan Life Insurance.

READ ALSO: Property Management Success: Reimagining Retail

Camp currently operates in Atlanta, Boston, Chicago, Dallas, Los Angeles, New York and Washington, D.C. Simon’s Burlington Mall Camp location, in the Boston market, opened in 2022. That one recently announced that Bluey x Camp, a collaboration with BBC Studios, will open later this summer.

Camp has been providing entertainment for young families since 2018, offering immersive retail experiences tied in with popular staples including The Little Mermaid, Trolls, Encanto and Bluey.

Experiential retail growing

In its Brown Book of Retailer and Restaurant Expansion 2024, Garrick Brown anticipates strong growth this year among experiential retail operations, including those set up for family amusement, such as Camp. There will be a net of more than 150 openings of family-oriented amusement at malls in 2024, the company forecasts.

READ ALSO: Retail Investors Are Adapting to Disruption. Here’s How.

Other experiential retail growth this year is set to involve art and culture exhibits as part of museum concepts, with nearly 30 net openings in 2024, and escape rooms, which is still largely a travel-destination concept that will see nearly 20 openings this year.

The largest growth trend among experiential retail will involve “competitive socializing,” the Brown Book found, including pickleball, bocce, bowling and other activities. There will be 378 openings of this kind of experiential retail this year, according to Garrick Brown.

The post Simon Doubles Down on Experiential Retail appeared first on Commercial Property Executive.

Rockefeller Group has started construction on Rockefeller Group Logistics Center at Carneys Point, a two-building, more than 1.1 million-square-foot campus in Carneys Point, N.J. This marks the company’s second industrial project in Southern Jersey, following the development of a 345,600-square-foot warehouse in Mount Holly, N.J.

Sumitomo Mitsui Trust Bank provided a $114.8 million construction financing for the project, CommercialEdge data shows.

Partners on the development include M + H Architects and civil engineer Langan Engineering & Environmental Services, while FCL Builders serves as general contractor. Slated for completion in early 2025, the project features significant infrastructure enhancements that will benefit the region.

READ ALSO: How Much Longer Is ‘Higher for Longer’?

The developer consolidated the 141-acre site from 13 distinct parcels acquired from 11 different sellers, completing the purchase in 2022. Curran Commercial President Ryan Curran represented the buyer in the transactions and land assemblage.

A well-located industrial campus

The 596,443-square-foot Building A will feature 127 dock-high loading doors and four drive-in doors, together with 122 trailer stalls and 363 parking spaces. Building B will measure 530,000 square feet and have 118 dock loading doors, four drive-in doors, 295 car spots and 206 trailers spaces.

Both warehouses are set to feature 40-foot clear heights, 60-foot bay spacing and 10,000 square feet of speculative office space. CBRE Senior Vice President Drew Green, Vice Chair Thomas F. Monahan, along with Executive Vice Presidents Larry Schiffenhaus and Brian Golden, are conducting the leasing efforts.

The campus is rising at 37 Forest Lane, the location providing easy access to Interstate 295 and Highway 40. Downtown Philadelphia is 34 miles away, while Port of Wilmington is within 15 miles. The site is also less than 24 miles from the Philadelphia International Airport.

Rockefeller’s industrial expansion across the U.S.

Rockefeller Group currently has 16 industrial projects under development across the U.S., totaling some 6 million square feet. The company has delivered 38 logistics properties since its inception.

Last month, Rockefeller Group and PCCP LLC obtained $100.2 million in construction financing for the development of Rockefeller Logistics Center on the Boulevard, a two-building, 656,904-square-foot industrial campus in Northeast Philadelphia. The speculative project broke ground in December and is anticipated to come online in 2025.

In November, the company partnered with Matan Cos. to develop a 5 million-square-foot logistics center in Suffolk, Va. The $300 million project will come online in multiple phases, the first one to comprise 2.4 million square feet across five buildings.

The post Rockefeller Group Breaks Ground on 1.1 MSF New Jersey Campus appeared first on Commercial Property Executive.

Blenheim Group has broken ground on Bayberry Town Center, a 280,000-square-foot mixed-use project in Middletown, Del., a Philadelphia suburb.

Upon completion, the property will comprise nearly 249,000 square feet of retail and 31,000 square feet of office space, together with 145 townhomes, retail pad sites and two green areas.

Bayberry Town Center represents the final phase of development for the 1,500-acre Village of Bayberry master-planned community, which boasts almost 2,700 homes. Blenheim Group obtained the final site plan approval from New Castle County Council in March.

READ ALSO: Designing the Suburbs of the Future

Weis Markets will anchor the property’s retail component with a 64,000-square-foot flagship store and a gas station. Slated for groundbreaking this fall, the store is expected to open next year.

Bayberry Town Center’s tenant roster is set to also include a bank, pet store, spa and nail salon, along with several restaurants. LMT Commercial Realty Principal Jim Tancredi and Sales and Leasing Agent Tyler Foresta are handling the leasing efforts.

The development site occupies more than 69 acres at the intersection of Boyds Corner and Jamison Corner Road. Downtown Wilmington, Del., is less than 30 miles northeast, while downtown Philadelphia is some 55 miles away.

The post Blenheim Group Kicks Off Philly-Area Mixed-Use Project appeared first on Commercial Property Executive.

The Rockefeller Group and PCCP LLC have secured $100.2 million in construction financing for their joint development of the Rockefeller Logistics Center on the Boulevard, a two-building 656,904-square-foot speculative industrial campus in Northeast Philadelphia.

The loan, provided by New York Life Real Estate Investors, was arranged by a Cushman & Wakefield team consisting of Vice Chairman John Alascio, Managing Directors Aaron Graves and Alex Lapidus, Senior Directors Chuck Kohaut and TJ Sullivan as well as Associate Jason Blankfein.

Development of Rockefeller Logistics Center on the Boulevard, the developer’s first in the city, was announced in December of last year, following the partners’ purchase of the 50.4-acre development site from the Philadelphia Industrial Development Corp. Previously, the site was home to the unbuilt Byberry North Business Center. CBRE, which advised the developers during the transaction, will also oversee leasing at the finished campus.

Later that month, the developers received permits for the project’s development, as reported by the Philadelphia YIMBY.

The project is among PCCP’s most recent industrial endeavors in the Northeast. Last week, the firm provided a $64 million construction loan for McClellan One, a 120,584-square-foot project in Newark, N.J. 

Rockefeller and Roosevelt

According to Heath Abramsohn, Rockefeller’s vice president & regional director for the northeast region, the project broke ground that same December, and is expected to finish construction in the second quarter of 2025. The joint ventures’ development partners of choice are NORR, which is serving as the project’s architect of record, Pennoni Associates for civil engineering, and IMC Construction, which will handle general contracting.

When its construction finishes, the campus’ two buildings, A and B, will respectively measure out at 318,696 and 338,208 square feet. Both buildings will have interiors with 36-foot clear heights. Building A will have two drive-in doors, 49 dock doors, and 57 trailer parking spaces, while Building B will have the same number of drive-in doors, alongside 46 dock doors and 52 trailer parking spots. Additionally, both buildings will have six electric vehicle charging-enabled parking spaces.

READ ALSO: ULI Economic Forecast: Tailwinds, Hurdles or Both?

Located at 15000 Roosevelt Blvd., the property will have direct frontage to U.S. Route 1, which feeds into interchanges to the Interstates 95 and 276, respectively located 1.5 and 5 miles away. Philadelphia’s Center City District is 14 miles to the southwest, while its International Airport sits roughly 6 miles further in the same direction. Nearly all of the Acela corridor lies within a day’s drive of the campus, in addition to Pittsburgh, Cleveland and Columbus.

Philadelphia’s industrial fortitude

Despite a recent slowdown in development, Philadelphia has among the largest development pipelines in the Northeast, clocking in at nearly 6.2 million square feet, according to CommercialEdge’s most recent national industrial report. Recent high profile additions to the metro’s pipeline include RLS Logistics’ expansion of a cold storage facility in Delanco, N.J., to 180,000 square feet, alongside J.G. Petrucci Co. and Cabot Properties’ joint development of a 320,250-square-foot facility in Feasterville-Trevose, Pa.

The post Rockefeller Group, PCCP Secure $100M for Logistics Center appeared first on Commercial Property Executive.

RLS Logistics will expand its existing cold storage facility at 1000 Coopertown Road in Delanco, N.J., to 180,000 square feet. The property now spans 45,000 square feet.

The 135,000-square-foot addition will increase the facility’s capacity by some 24,000 pallet positions, to a total of more than 30,600. The existing property, which opened in 2018, has 12 dock doors and features storage at temperatures between -10 degrees F and 38 degrees F, with 45 degrees F in the dock.

Powered by solar energy, the facility features 54-foot-high ceilings and a CO2 refrigerant system. In prepared remarks, RLS Logistics CCO John Gaudet emphasized that the expansion is not only meant to increase the square footage, but also broaden the company’s menu of services and operational capabilities.

Located near Highway 130, the property is some 14 miles from the Port of Philadelphia and from the Northeast Philadelphia Airport.

Philadelphia industrial development slows

As of January, Philadelphia was in the lead among northeastern markets in terms of industrial development, boasting a pipeline of nearly 7.8 million square feet, which accounted for 1.8 percent of existing inventory, according to a recent CommercialEdge report. Throughout 2023, developers broke ground on only six properties totaling some 2.5 million square feet, a whopping 72 percent decrease from the previous year’s figures.

Although a relatively small niche within the broader industrial market, cold storage has been exhibiting steady growth, facilitated by the shift toward e-commerce which was further accelerated by the pandemic. These favorable trends have made the subsector increasingly attractive for developers and investors alike.

The post RLS Logistics to Expand Philly-Area Cold Storage Facility appeared first on Commercial Property Executive.

The partnership between DRA Advisors and KPR Centers has received $55 million in financing for Quartermaster Plaza, a 456,208-square-foot open-air shopping center in Philadelphia. Webster Bank provided the five-year loan, public records show, in a deal arranged by JLL Capital Markets.

DRA and KPR purchased the property in 2022 from Cedar Realty Trust for $100.1 million, in an $879 million portfolio deal involving 35 grocery-anchored shopping centers and totaling more than 4.9 million square feet.

READ ALSO: What’s Ahead for Retail in 2024?

Quartermaster Plaza came online on some 44 acres in 2004. Anchored by BJ’s, The Home Depot and Sprouts Farmers Market, the retail center has a diverse mix of regional and national tenants such as Bank of America, Wendy’s, Walgreens, PetSmart and Planet Fitness, among others.

The shopping center was 99 percent leased at the time of the transaction, with 15.7 years of weighted average tenure and a weighted average lease term of eight years. The property has seen more than 53,000 square feet of new leases signed and 191,000 square feet of lease renewals closed in the last 36 months, according to JLL.

Senior Managing Directors Michael Gigliotti and James Galbally, together with Senior Director Michael Pagniucci and Associate Blaine Fleming, led the Debt Advisory Team which represented the owners.

Philadelphia’s tourism adding to retail demand

Located at 2200 W. Oregon Ave. in the South Philadelphia West neighborhood, Quartermaster Plaza serves around 328,145 individuals within a 3-mile radius, with the average household income of approximately $88,810, according to JLL. Situated right off Interstate 76, the property received more than 3.7 million visitors over the last 12 months and ranked as the second most visited retail center within a 5-mile radius.

Greater Philadelphia’s tourism trade exceeded pre-pandemic levels last year, adding to retail demand, according to a fourth quarter 2023 report by CBRE. The metro’s amount of available space continued to disappear as leases were signed and deals were closed; the vacancy rate clocked in at 7.2 percent, a 70-basis-point drop from the value recorded in the first quarter of last year.

The post DRA Advisors JV Secures $55M for Philly Shopping Center appeared first on Commercial Property Executive.

The Philadelphia office market had a mixed performance throughout 2023. The development pipeline grew, with construction starts significantly increasing compared to the previous year, this activity being mainly bolstered by life science projects. Investment volume however dropped massively, reaching about a third of that recorded in 2022.

Office debt in the metro also continued increasing as maturities expected in the near future outpace national figures. Flexible space in the metro has continued to maintain its hold, representing however a smaller share than most other comparably sized markets.

Life science projects bolster development

As of December, the Philadelphia office market had nearly 3.8 million square feet under construction across 14 properties, accounting for 1.7 percent of stock. The pipeline was on par with the national construction rate and surpassed comparably sized markets such as Phoenix (0.6 percent), Houston (1.1 percent) and Baltimore (1.5 percent), but lagged other secondary markets including Charlotte (3.1 percent) and Nashville (4.4 percent).

The most sizeable project currently under construction is the Quartermaster Science + Technology Park. Developer SkyREM is leading the $250 million venture which involves converting the historic Quartermaster site into a mixed-use property slated to include 1 million square feet of wet and dry lab space for R&D and bio-manufacturing purposes.

Another large development underway is 3151 Market, a 435,000-square-foot life science project, developed by a joint venture of Brandywine Realty Trust and Drexel University. The partners recently topped out the 14-story building in October and expect completion in 2024. It will be part of the $3.5 billion, 14-acre Schuylkill Yards mixed-use master plan in Philadelphia’s University City district.

Throughout 2023, seven properties broke ground in Philadelphia’s office market for a total of 2.3 million square feet, accounting for 1 percent of existing stock, double the national rate of development. This activity was mostly bolstered by the life sciences sector, as of the total, nearly 2.1 million square feet belonged to this asset type. Compared to the previous year, development activity increased, as in 2022 only 1.4 million square feet broke ground.

One of the most significant projects to commence construction this year is Gattuso Development Partners and Vigilan Holdings of New York’s life sciences development at 3201 Cuthbert St. The 519,647-square-foot property is slated for completion in early 2025 and is valued at more than $400 million. The partners secured a $290 million loan for the venture in late 2022.

Nearly 1.6 million square feet of office space entered the Philadelphia market in 2023 across 7 properties, accounting for 0.7 percent of existing stock, on par with the national rate of deliveries of 0.8 percent. In terms of volume, the metro considerably surpassed secondary markets such as Baltimore (648,625 square feet), San Diego (559,964 square feet) and Phoenix (528,890 square feet) but lagged others including Austin (2.8 million square feet) or the Bay Area (4.1 million square feet).

The largest property to come online in 2023 was One uCity Square, a 400,000-square-foot lab and office building. The $300 million project was developed by Ventas in partnership with Wexford Science + Technology and the University City Science Center. It is part of the 4 million-square-foot uCity Square mixed-use project salted to comprise two residential buildings, five office and lab buildings, a public school and an academic building for Drexel University.

Investment volume drops by two thirds

Throughout 2023, some 5.5 million square feet traded across 45 properties in the Philadelphia office market for a total investment volume of $523.3 million. These figures represent a tremendous drop from the previous year when 9.1 million square feet changed hands for nearly triple the investment at $1.6 billion.

The price per square foot in the metro clocked in at $127.5 as of the end of the year, a roughly 25 percent decrease from 2022. Prices in Philadelphia surpassed secondary markets such as nearby Baltimore ($100.4), but considerably lagged others such as Austin ($304.1) and the Bay Area ($341.4).

The largest sale recorded in 2023 was David Werner Real Estate Investments’ $71.5 million acquisition of the 885,233-square-foot Dow Chemical Northeast Technology Center. Pfizer sold the asset and continues to occupy space at the location through its subsidiary Wyeth. It is part of a campus including 14 interconnected office, life science and mixed-use buildings. DWREI, in partnership with GreenBarn Investment Group, acquired the entire park in August for $180 million, involving a $95 million CMBS loan. Recently, materials science company Dow signed a lease for 800,000 square feet at the asset.

Another sizable transaction was the $67.8 million sale of One Tower Bridge, a 270,000-square-foot office building in suburban Philadelphia. The Buccini/Pollin Group acquired the asset, which was 92 percent occupied at the time of the transaction. The acquisition also involved a $59 million loan from Citibank, according to CommercialEdge data.  

Office debt increases in Philadelphia

A large leasing deal in the past year is architecture firm EwingCole’s 55,000-square-foot renewal at 10 North Independence Mall West. Owned by The Federal Reserve Bank of Philadelphia, the Class A office building spans 775,000 square feet across eight stories. Newmark represented the tenant in the transaction.

The total debt in the Philadelphia office market amounted to nearly $23.2 billion as of October 2023, according to a recent CommercialEdge market bulletin. By the end of 2024, 20.5 percent of it will be maturing, above the national rate of 16.1 percent, and through 2026 the figure rises to 36.4 percent, the same source shows.

One of the largest notes originated during 2023 was the $409 million in credit tenant lease financing for Parkway Corp.’s development of Chubb’s new headquarters. UMB Bank provided the fixed-rate long term note as trustee of the JLL Securities Credit Lease-Backed Pass-Through Trust. The project will break ground in early 2024 and is expecting completion by 2026.

Coworking remains an option

As of the end of 2023, there was more than 2.5 million square feet of flexible space in Philadelphia’s office market accounting for 1.3 percent of total stock. The share of coworking space was smaller than the national average of 1.7 percent and lagged comparably sized markets such as Houston (1.7 percent) or Atlanta (2.1 percent). It was on par with Charlotte’s 1.3 percent and above Baltimore’s 0.8 percent.

The largest flexible space operator in Philadelphia was Regus with a total of 463,363 square feet across 25 properties. Other key players in the market include Industrious with 122,774 square feet in three locations, as well as WeWork with two coworking properties totaling 106,564 square feet.

The post Philadelphia’s Office Market Had a Mixed 2023 appeared first on Commercial Property Executive.

Located about 20 miles northwest of Philadelphia in East Whiteland Township, Pa., the site was acquired by GFLC and 1547 in 2022. The development firm had previously received the local authorities’ approval to construct two data centers of about 1 million square feet each. An adjacent property is available for the development of data center buildings totaling up to 5 million square feet.

READ ALSO: Will the Data Center Industry Grow More in ’24?

Adjacent to the Planebrook substation, the Chester County campus has an initial commitment of 290 MW of power from a local provider, including access to carbon-free power capabilities that will be available by 2025-2026. The power provision is critical to address the increasing requirements of hyperscale companies and diverse technology-driven enterprises as artificial intelligence, video streaming and other cutting-edge technologies and applications place greater demands on data center infrastructure.

Other green energy solutions are to include rooftop solar with potential generation of up to 7 MW of capacity scalable to 25 MW. In addition, 1547 is committed to a sustainable reforesting project and plans to plant 4,000 new trees at the Chester County site.

Previously the location of Foote Mineral Co.’s Frazer facility, the parcel is on the corner of Valley Creek Boulevard and Swedesford Road. The property has access to Tier 1 carriers such as Arelion, Lumen and Windstream.

Incentives outlined

John Bonczek, chief revenue officer for 1547, said in a prepared statement financial incentives offered by Chester County are among the best available for large-scale computer infrastructure deployments. The developers, operators and future tenants will also benefit from state sales tax exemption on data center developments that includes all construction equipment, materials, data center furnishings, fit-out and IT equipment.

Matawan, N.J.,-based 1547 is a developer, operator and owner of highly-interconnected, customer-designed data centers with more than 1.25 million square feet of data center space under management in the U.S. and Europe. The company’s portfolio includes carrier hotels and core connectivity hubs designed to deliver mission-critical solutions. Its flagship data center in Orangeburg, N.Y., is home to Fortune 100 companies and large hyperscalers attracted to the space, power and proximity of connectivity to facilities in Manhattan.

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Materials science company Dow has signed a long-term lease extension for nearly 800,000 square feet at Northeast Dow Center in Collegeville, Pa., near Philadelphia. The owner is a joint venture between David Werner Real Estate Investments and GreenBarn Investment Group. The tenant was represented by Newmark.

The campus at 400 and 500 Arcola Road, which houses Northeast Dow Center, spans 1.9 million square feet across 340 acres. It includes 14 interconnected office, life science and mixed-use buildings, as well as 105,000 square feet of amenity spaces. The property is close to interstates 76 and 276; downtown Philadelphia is roughly 22 miles away.

READ ALSO: Attracting Life Science Tenants in Core Markets

The partners acquired the campus in August 2023 from Pfizer, which continues to occupy space at the property through its subsidiary Wyeth. The complex changed hands for $180 million and the acquisition involved a $95 million CMBS loan from Starwood Mortgage Capital and BMO Capital Markets.

The building Dow occupies at 400 Arcola Road rises five stories and spans 885,233 square feet. It traded for $71.4 million, according to CommercialEdge data, and became subject to a $45.4 million CMBS loan from Wilmington Trust with a fixed rate of 7.29 percent. The property came online in 1992 and underwent cosmetic renovations in 2003.

Office leasing in Philadelphia

As of November, office listing rates in Philadelphia clocked in at $32, marking a 3.1 percent increase year-over-year and slightly below the national average of $38, according to a recent CommercialEdge report. The vacancy rate in the metro reached 14.3 percent, rising by 1.4 percent over 12 months—below the 18.2 percent national figure, the same source shows.

The post R&D Hub Inks 800 KSF Lease Extension appeared first on Commercial Property Executive.

J.G. Petrucci Co. has formed a joint venture with Cabot Properties to develop a 320,250-square-foot industrial facility in Feasterville-Trevose, Pa. Principal Asset Management provided a $35.7 million construction loan, according to public records.

JLL Capital Markets arranged the construction loan, as well as the joint venture equity, representing the sponsor, J.G. Petrucci.

Scheduled for completion in the third quarter, the Class A warehouse is set to feature 36-foot clear heights, two drive-in doors, 55 dock-high loading doors and 50- by 54-foot column spacing. Additionally, the property will feature 56 trailer stalls and 195 car vehicle parking spaces, along with some 2,500 square feet of office space.

The distribution facility will rise on 19.5 acres at 4626 Somerton Road, offering easy access to routes 1 and 132 and several other major thoroughfares. Northeast Philadelphia Airport is within 7 miles, downtown Philadelphia is 20 miles away, while Port of Camden is 24 miles southwest.

The JLL Capital Markets team comprised Senior Managing Directors Jon Mikula and John Plower, Director Ryan Cottone and Vice President Michael Lachs. Last summer, Mikula and Lachs were part of the team that arranged the construction financing for a 211,388-square-foot industrial project in Newark, N.J., expected to come online later this year.

Philly’s leading industrial pipeline

As of November last year, Philadelphia had the largest pipeline in the Northeast region, with 10.8 million square feet of industrial space under construction, or 2.5 percent of total stock, a CommercialEdge industrial report shows. Recent new development in the market included Rockefeller Group’s partnership with PCCP LLC for the development of a 656,904-square-foot industrial campus.

Hilco Redevelopment Partners is working on a $4 billion, 1,300-acre mixed-use project in South Philadelphia. Its first phase is expected to encompass two industrial buildings totaling more than 1 million square feet.

The post Cabot, Petrucci JV to Build 320 KSF Philadelphia Warehouse appeared first on Commercial Property Executive.

Sylvamo North America has extended its lease at 1500 John Galt Way, a warehousing and distribution facility in Florence, N.J. The International Paper spinoff will continue to occupy the 431,720-square-foot building. Colliers Senior Managing Director Marc Isdaner alongside Vice President Alex Stringfellow represented the tenant in securing its extended stay.

The warehouse at 1500 John Galt Way came online in 2008 within the Haines Center, an 800-acre master planned industrial park that comprises 15 buildings and some 4.5 million square feet of space. Central New Jersey-based Whitesell Construction Co. is the developer and current owner of the campus that includes manufacturing and distribution facilities operated by the likes of Amazon, Saddle Creek, Burlington, BJ’s and FEE Transportation. The most recently constructed addition to the park, a 310,960-square-foot building, came online in 2019, according to CommercialEdge information.

READ ALSO: What’s Next for Industrial Real Estate?

Currently the third-largest facility at the Haines Center, the building at 1500 John Galt Way has 30- to 37-foot clear heights, 180-foot truck courts and 40- by 60-foot column spacings. In addition to direct access to the NJ and PA turnpikes, the property also provides tenants with rail service via the Norfolk Southern’s Bordentown Secondary Line.  

Located roughly 8 miles south of Trenton, N.J., and 24 miles northeast of Philadelphia, 1500 John Galt Way is within half a day’s drive of Northeast’s largest cities, as well as Washington, D.C.

Gains in The Garden State

Relative to its size, New Jersey’s industrial market remains one of the nation’s highest performers—owned in part to its proximity to major population centers in the Northeast and Mid-Atlantic—with high asking rents, a large pipeline and a high transaction volume. According to a recent CommercialEdge report, The Garden State had nearly 8.5 million square feet of space under construction as of November across its three major markets, while currently online facilities command historically high rents of $10.06 per square foot. Meanwhile, year-to-date sales dwarfed those of Boston and Philadelphia, with $2.5 billion worth of transactions.

New Jersey’s industrial market is already off to a strong start this year. Earlier this week, Bridge Industrial secured $53.5 million in financing for the development of Bridge Point 999, a 291,758-square-foot building in South Brunswick.

The post Paper Maker Inks NJ Lease Extension appeared first on Commercial Property Executive.

Rockefeller Group Logistics Center at Roosevelt Boulevard will total 656,904 square feet. Image courtesy of Rockefeller Group

Rockefeller Group has entered into a joint venture partnership with PCCP LLC for the construction of Rockefeller Group Logistics Center at Roosevelt Boulevard, a two-building, 656,904-square-foot industrial project in Philadelphia. The development team includes IMC Construction as general contractor, NORR as architect of record and Pennoni Associates as civil engineer.

The companies purchased the project’s 50.4-acre site from Philadelphia Industrial Development Corp., the city’s public-private economic development organization. The partners represented themselves in the land acquisition; CBRE provided advisory services during negotiations and has been retained as exclusive leasing agent for the project.

READ ALSO: Behind the Project: Portman Goes Big in Philly

This will be Rockefeller Group’s first industrial development in Philadelphia, where there is old industrial product and a growing demand for new Class A space, said Vice President & Regional Director Heath Abramsohn in prepared remarks. The industrial campus will comprise two buildings of 318,696 and 338,208 square feet, respectively.

Rockefeller Group Logistics Center at Roosevelt Boulevard will take shape at 1500 Roosevelt Blvd., on the site of the former Byberry State Hospital. The location is 5 miles from Northeast Philadelphia Airport, 15 miles from Trenton, N.J., 21 miles from downtown Philadelphia and within 47 miles of Wilmington, Del.

CBRE’s team of Mike Hines and Brad Ruppel advised the joint venture partners during the land acquisition, while the company’s Drew Green, Paul Touhey and Mike Mullen will serve as the property’s leasing agents.

Philly leading the Northeast for industrial development

Philadelphia continues to lead the major northeastern markets for industrial pipeline size, according to a recent CommercialEdge report. The metro had 11 million square feet underway as of October, being followed by New Jersey (7.3 million square feet), Bridgeport (3.4 million square feet) and Boston (2.3 million square feet).

One major development in the area is Hilco Redevelopment Partners’ 1,300-acre, $4 billion Bellwether District project in South Philadelphia, that broke ground in October. Plans call for a 14 million-square-foot campus set to include life sciences, industrial and logistics space.

Other projects include Sansone and Crow Holdings Capital’s Tac-Pal Logistics Center in Palmyra, N.J. The partnership recently received $102 million in construction financing for the development’s second phase, slated to include a 700,000-square-foot industrial building.

The post Rockefeller Group, PCCP to Build Philly Industrial Campus appeared first on Commercial Property Executive.

Joshi Hotel Group purchased Dorneyville Shopping Center in 2012. It is currently 86 percent leased and anchored by Aldi. Image courtesy of Institutional Property Advisors

LS Property Investments has purchased Dorneyville Shopping Center, a 101-651-square-foot grocery-anchored shopping center in Allentown, Pa. Joshi Hotel Group sold the asset for $17.8 million. At the time of the sale, the one-story building was 86 percent leased.

Institutional Property Advisors brokered the transaction, with Executive Director Brad Nathanson and Senior Director JP Colussi working on behalf of the seller and procuring the buyer. Tompkins Community Bank originated the $12 million acquisition loan, according to CommercialEdge data.

Joshi Hotel Group purchased the 1961-completed building back in 2012 from Roi Management for $16 million, the same source shows.

Anchored by Aldi, Dorneyville Shopping Center includes a diverse mix of grocery, restaurant, medical, fitness and service-use tenants such as Pizza Hut, Marshall Arts, Total Eye Care, Mario’s Pizza, Dedicated Nursing Associates, One Main Financial, an ImagiNation children’s entertainment place and Body Elite Fitness Training.

Located at 3227 Hamilton Blvd., the center is positioned within the fastest growing region in Pennsylvania. The property is in an affluent community with strong annual growth, serving approximately 224,877 residents within a 5-mile radius. Dorneyville Shopping Center is near the intersections of Interstate 78, Route 222 and Interstate 467, and within walking distance of Dorney Park & Wild Water Kingdom and Cedar Crest Hospital.

Institutional Property Advisors recently represented KPR Centers in the sale of Gloucester Town Center, a 102,660-square-foot grocery-anchored shopping center in Sicklerville, N.J. The brokerage company worked on behalf of the seller and procured the buyer.

The post Philly-Area Shopping Center Trades for $18M appeared first on Commercial Property Executive.

One uCity Square comprises 400,000 square feet of lab and office space. Image courtesy of Turner Construction Co.

Ventas has officially completed and opened One uCity Square, a 400,000-square-foot Class A lab and office building in Philadelphia. The project team also includes Turner Construction Co. and McKissack & McKissack as general contractors, as well as ZGF Architects.

Ventas, in partnership with Wexford Science + Technology and the University City Science Center, is the developer of uCity Square, a 4 million-square-foot mixed-use project comprising two multifamily buildings with ground-floor retail, five office and lab buildings, a public school and one academic building used by Drexel University.

READ ALSO: Life Science Market to Bounce Back: JLL

One uCity Square is a $300 million project at 225 N. 38th St. that features 32,500-square-foot floorplates, six passenger elevators and 10,000 square feet of retail space, according to CommercialEdge. The same source reveals that United Overseas Bank originated the construction financing. One uCity Square is expected to receive LEED Silver certification.

Common-area amenities include four winter gardens, private outdoor terraces, speculative lab and office spaces with high ceilings and a rooftop terrace. University City Science Center also developed community programs for the facility, including the Entrepreneurs Clubhouse, Venture Café Philadelphia, Quorum and FirstHand.

The approximately 5-acre property is close to multiple light rail and subway stations, 2 miles from downtown Philadelphia, 8 miles from Philadelphia International Airport and within 17 miles of Northeast Philadelphia Airport. The tenant roster includes Penn Medicine, University of Pennsylvania Health System, Exponent, Penn Engineering and Century Therapeutics, among others.

An innovation-driven market

The office and lab facility that broke ground in 2020 was part of Ventas’ joint venture with GIC, a partnership focusing on Research & Innovation developments for an initial cost of $930 million. The first four projects, that had Ventas as majority owner, comprised One uCity Square, Drexel University’s academic facility, Pitt Immune Transplant and Therapy Center for University of Pittsburgh Medical Center and a Class A, R&D center anchored by Arizona State University.

There are multiple life science developments in diverse phases of construction in the metro. Brandywine Realty Trust and Drexel University topped out a 435,000-square-foot, 14-story life science building in Schuylkill Yards, a $3.5 billion mixed-use master plan project in University City district.

In August, MRA Group secured $63 million in additional financing for the redevelopment of CRISP, a 164-acre, 14-building campus in Wilmington, Del. The redevelopment of the former DuPont Chestnut Run Laboratory campus will result in renovated buildings for lab, R&D and advanced manufacturing uses.

The post Ventas Wraps Up $300M Philly Life Science Project appeared first on Commercial Property Executive.

Tac-Pal Logistics Center’s first phase came online earlier this year. Image courtesy of Affinius Capital

A fund advised by Crow Holdings Capital, together with Sansone, has obtained a $102 million construction loan for the development of Tac-Pal Logistics Center’s second phase—a 700,000-square-foot industrial building in Palmyra, N.J. Bank OZK provided the senior portion of the financing. Affinius Capital originated the loan, while JLL brokered the transaction.

Tac-Pal Logistics Center’s second phase is already underway and will feature 40-foot clear heights and cross-dock configuration. Plans also call for drive-up ramps, 438 vehicle parking spots, 166 tailgates and 236 trailer parking spots.

The first phase came online earlier this year and consists of a 702,450-square-foot industrial building at 201 S. State Route 73. In July, YesWay Logistics signed a 252,000-square-foot lease.

Tac-Pal Logistics Center occupies 134 acres and allows for direct access to interstates 95, 295 and to New Jersey Turnpike. It is 12 miles from downtown Philadelphia, 21 miles from Philadelphia International Airport and within 27 miles of Trenton, N.J.

Other industrial projects moving forward in the metro include Foxfield’s Lower Bucks Logistics Hub, a two-building, 81,567-square-foot project near Philadelphia. The developer financed it with a $114 million construction loan in August. One month earlier, DH Property Holdings received a $175 million financing package for the development of a last-mile distribution center in Philadelphia, totaling 750,000 square feet.

The post Sansone, Crow Holdings Land $102M for Philly-Area Project appeared first on Commercial Property Executive.

Phase I is set to bring a roughly 636,000-square-foot facility to the market. Image courtesy of Portman Industrial

Recently, site work began at Portman Industrial‘s I-76 Trade Center, a $330 million speculative project totaling 1.9 million square feet in Exton, Pa. The logistics campus is slated to encompass three facilities that will come online in two phases. The first one is set to bring to the market a 636,120-square-foot, cross-dock building with four drive-in doors, 110 dock doors, 146 trailer stalls and 508 parking spaces, while Phase II will include a 1.1 million-square-foot facility and another 154,440-square-foot building.

Built on almost 170 acres, I-76 Trade Center is slated for full completion in early 2025. Commercial Property Executive asked Portman Industrial Managing Director John Gaskin to share details about how work at the massive project is going and expand on the area’s growth potential.

What convinced you to invest in Philadelphia? 

I-76 Trade Center will be attractive to multiple types of uses, according to John Gaskin. Image courtesy of Portman Industrial

Gaskin: Philadelphia has the oldest industrial inventory in the country. The existing stock of product does not have the modern amenities and building features it needs to support current demand. Now, we are seeing a more robust pipeline of advanced industrial space—such as more efficient dock doors and taller ceilings. With I-76 Trade Center, we are developing a three-building, institutional-quality logistics campus that will answer the demand for modern warehouse and logistics space in this region.

This region benefits from being in close proximity to major metros, including New York City and Washington, D.C. Philadelphia is the seventh-largest MSA in the country. With a strong trajectory for future growth, Southeastern Pennsylvania is an economic engine, supported by a wide network of expressways, trains and buses.

READ ALSO: Industrial Sector Navigates Growth Challenges

What sets the I-76 Trade Center project apart from other industrial developments in the metro?

Gaskin: I-76 Trade Center’s premier location sets it apart from other projects. With frontage along the Pennsylvania Turnpike, it is situated strategically within Philadelphia’s western suburbs and provides immediate access to Exit 312. The Interstate 76 Schuylkill Expressway, the Interstate 95 Delaware Expressway, Interstate 476, and U.S. routes 202, 100 and 30 all contribute to the region’s long-term logistics prowess. Additionally, I-76 Trade Center is equidistant to Exit 8A of the New Jersey Turnpike.

Overall, the area benefits from impressive logistical infrastructure, including the Philadelphia International Airport, Port of Philadelphia and three intermodal rail centers, as well as FedEx and UPS facilities.

Phase I is scheduled for delivery next year in August. What types of businesses do you envision as the ideal fit for the facility?

I-76 Trade Center is expected to be fully completed in the first quarter of 2025. Image courtesy of Portman Industrial

Gaskin: When starting a project like this, it’s easy to think that the obvious end user is a tenant focused on warehousing and the distribution of consumer goods. However, as we have developed this type of product over the past few years, we have been successful in attracting a variety of tenants.

Since we are developing the I-76 Trade Center on a speculative basis, it creates the opportunity for the tenant to come from any sector. In addition to warehousing and distribution, the end users could be involved in manufacturing, life sciences, data centers or cold storage. The product we are building is going to be attractive to all types of users.

Given the current economic climate, securing funding for a project of this magnitude can be challenging. Were there any obstacles in obtaining funding for the development?

Gaskin: These are turbulent times for capital markets. At Portman, we benefit from a 70-year track record of doing these types of projects with fantastic equity partners. We are fortunate to have deep, long-term banking relationships that allow us to fully capitalize our projects even when the industry is facing economic headwinds.

There’s a growing trend for developers to add recreational facilities and other amenities to industrial projects. Will I-76 Trade Center feature such spaces?

Gaskin: At I-76 Trade Center, we are building a 26-acre public park with walking trails and other amenities. We are also preserving historical farming facilities on the site. Since we are building spec, we will defer to the tenant on the specific amenities they would want included for the building, such as a basketball court, outdoor seating, etc.

READ ALSO: A Backstage Look at Hines’ Quantum 56 Project in Denver

To what extent has Portman incorporated community considerations into the planning and execution of I-76 Trade Center?

Gaskin: We are passionate about contributing to the communities we are in, and our philosophy is always to listen first. When we set our eyes on a project, we place a huge emphasis on being open and transparent with the community about our plans. We are dedicated to meeting with the neighborhood and community groups and really taking the time to get their input.

For example, at I-76 Trade Center, we listened to the township and community members and knew it was important to incorporate a public park, as well as preserve the historic farming buildings.

What are the most frequent challenges industrial developers need to face today? How is Portman addressing these headwinds?

I-76 Trade Center will include three buildings totaling 1.9 million square feet. Image courtesy of Portman Industrial

Gaskin: In our industry today, there are short-term and long-term headwinds. Currently, the short-term headwinds are the challenges with the capital markets in raising equity and debt. As inflation eases and interest rates decline, we fully expect that the capital will start flowing back into the industrial development sector.

The long-term headwinds that we are facing include dysfunction in the supply chain, longer and unpredictable entitlement periods, labor shortages and product availability—like switchgear, generators and fire pumps. In this regard, it is critically important to do your homework and plan accordingly.

What emerging technologies is Portman monitoring or actively incorporating into its development strategies?

Gaskin: Our team and the industry as a whole is laser-focused on how to achieve greater energy efficiency within industrial buildings. We are looking at innovative ways to reduce the carbon footprint of the built environment and lower operating costs. There is a considerable effort being placed on bringing alternative sources of power into these facilities, and this is something we will continue to prioritize for a more sustainable future.

Speaking of the future…we’re nearing the end of 2023. Is there a particular trends that you expect to shape the industrial market in the upcoming year?

Gaskin: While things have slowed down, leasing activity remains rock solid. There continues to be significant levels of new tenants and deals in the market. Now more than ever, tenants are doing a very careful analysis to find the right location. Companies are taking a hard look at the available space and analyzing if that area is sustainable for fulfilling labor needs, operating costs and more.

The post Behind the Project: Portman Goes Big in Philly appeared first on Commercial Property Executive.

Christina Crossing. Image courtesy of FNRP

First National Realty Partners has acquired Christina Crossing, a 119,446-square-foot grocery-anchored shopping center in Wilmington, Del. The property marks the firm’s entry into the Delaware market. JLL represented the seller, DRA Advisors.

The property is anchored by a 68,621-square-foot ShopRite. Other tenants include Rainbow, Cricked Wireless and Wingstop. DRA Advisors purchased the asset in July 2022 in a portfolio deal, according to CommercialEdge data.

The one-story property is located at 501 S. Walnut St., just off S. Market Street, in downtown Wilmington, within an opportunity zone. The asset is less than a mile south of the Wilmington train station. According to Matt Annibale, senior director of acquisitions with FNRP, the property is adjacent to more than 80 acres of future development.

The JLL brokers that represented DRA Advisors in the transaction are James Galbally, Chris Munley and Colin Behr. In March, DRA Advisors completed the $369 million purchase of a mostly industrial portfolio in metro Chicago, in a partnership with Venture One.

The post First National Realty Buys Grocery-Anchored Retail Center appeared first on Commercial Property Executive.

3151 Market St. is part of the $3.5 billion mixed-use Schuylkill Yards project in University City. Rendering courtesy of Brandywine Realty Trust

Brandywine Realty Trust and Drexel University have topped out 3151 Market, a 435,000-square-foot 14-story life science building and the second of two speculative ground-up buildings in the $3.5 billion, 14-acre Schuylkill Yards mixed-use master plan in Philadelphia’s University City district.

Slated for completion in 2024, the tower at 3151 Market St. will have 417,000 square feet of best-in-market lab and office space, 18,000 square feet of retail and amenity space and 6,000 square feet of terrace space.

Designed by Gensler, the building will have 39,000-square-foot floorplates and a flexible 33-foot-by-45-foot structural bay to accommodate a diverse range of life science end users. It will provide substantially higher base building technology and infrastructure than industry and market standards, including higher lab capacity—up to 70 percent lab/30 percent office versus the market standard of a 50–50 split between lab space and office. Other features will include hazardous waste exhaust, chilled and condenser water loops, dedicated trash dock and increased elevator capacity.

READ ALSO: Property Management Success: AI’s Power and Potential

The building is designed to achieve LEED Platinum and WELL Silver certification. Highlights include a shared conference and event center with connected eco-terrace and balconies on alternating floors offering tenants access to fresh air and outdoor space. There will be 75 parking spaces in a subterranean garage.

Construction progress of 3151 Market. Image courtesy of INTECH Construction

Jerry Sweeney, president & CEO of Philadelphia-based Brandywine Realty Trust, said in a prepared statement the amenities are focused on occupant wellbeing to help companies define their cultures and brands and also provide a platform for employee success. He said the partners are providing physical spaces at Schuylkill Yards that will be used by companies as tools to attract and retain talent.

Schuylkill Yards details

Brandywine, in partnership with Gotham Organization, has already completed the first new ground-up building in Schuylkill Yards, which is located just west of Amtrak’s 30th Street Station in University City. 3025 JFK Blvd., a 28-story, mixed-use tower also known as West Tower, has 200,000 square feet of life science and office space, 326 luxury apartments in the Avira portion of the building and 9,000 square feet of ground-floor retail. In September, the law firm Goodwin Procter signed a 12.5-year lease for 31,500 square feet with an option to expand in the building, according to the Philadelphia Business Journal. The national firm is leasing the entire eighth floor, the highest in the 200,000-square-foot commercial portion of the building, and part of the seventh floor.

The office portion of the building has large, flexible 29,400-square-foot floorplates with 16-foot ceiling heights, state-of-the-art mechanical and building systems and fresh air intake, filtration and circulation that provide the optimal environment for both lab and collaborative office spaces.

Residents began moving into Avira in August. The commercial and residential tenants have access to a full-floor lifestyle center on the ninth floor featuring a pool and sundeck, cabanas, barbecue areas, great lawn, lounge spaces, co-working lounge and conference and meeting rooms.

At full build-out, Schuylkill Yards will have 6.5 acres of parks, 1.5 million square feet of living space, 3.9 million square feet of life science and office space and 65,000 square feet of retail space. Brandywine has developed more than 4 million square feet on the west banks of the Schuylkill River. Of that total, approximately 1.4 million square feet has been developed or redeveloped within the Schuylkill Yards master-planned area including the 1.3-acre Drexel Square Park, 3000 Market St., 3025 JFK Blvd. and 3151 Market St. It also renovated the historic Bulletin Building at 3025 Market St. into offices and lab space for Spark Therapeutics. The redeveloped two-story building at 3000 Market St. is also leased to Spark Therapeutics, a leader in next-generation gene therapy.

While the first two new towers were spec projects, Sweeney told the Philadelphia Business Journal last month construction will not begin on the planned 800,000-square-foot, 34-story East Tower at 3001 JFK Blvd. until it’s at least 50 percent preleased because of current economic conditions including volatility in interest rates and uncertainty in financing. Plans call for 550,000 square feet of office space and 250,000 square feet of life science space in the tower.

The post Brandywine, Drexel Top Out Philadelphia Life Science Tower appeared first on Commercial Property Executive.

Acme Food Markets is the anchor tenant of the property. Image courtesy of Institutional Property Advisors

KPR Centers has sold Gloucester Town Center, a 102,660-square-foot grocery-anchored shopping center in Sicklerville, N.J. Institutional Property Advisors brokered the transaction, representing the seller and procuring the buyer, a New York-based partnership.

KPR purchased the shopping center in 2014 for $10.3 million, according to CommercialEdge data. Completed in 2003, the property encompasses four buildings on a 19.2-acre site.

Acme Food Markets is the anchor tenant at the property, with a 57,560-square-foot, long-term lease in place. The company is planning a complete remodel of its store.

The tenant roster mainly includes national tenants, such as Dollar Tree, Supercuts, AT&T, Pizza Hut, Lowe’s, Target, PetSmart and Mavis Discount Tires. The asset also has several pad sites, which were recently leased to Taco Bell, KFC and Chase Bank. Gloucester Town Center was 98 percent leased at the time of the sale.

Gloucester Town Center is at 525 Berlin-Cross Keys Road, roughly 15 miles from downtown Philadelphia. Within a 3-mile radius, the shopping center serves approximately 60,000 residents with an annual average income exceeding $106,000. According to IPA, there are around 3,500 residential housing units in the planning and under construction stages within 5 miles of the retail center.

Institutional Property Advisors has recently represented Citivest Commercial in the sale of a 107,080-square-foot grocery-anchored retail center in Indianapolis. IPA worked on behalf of the seller and procured the buyer.

The post KPR Sells Philadelphia-Area Shopping Center appeared first on Commercial Property Executive.

Aerial view of the transformation of the former refinery into The Bellwether District. Image courtesy of Hilco Redevelopment Partners

Hilco Redevelopment Partners, of Chicago, has begun construction on the first phase of its $4 billion, 1,300-acre Bellwether District project in South Philadelphia.

The first building in this initial phase will be about 326,000 square feet and is expected to deliver late next year or early in 2025. The second building will be about 727,000 square feet and should be underway within two or three months.

Both are speculative developments as of now. Hilco CEO Roberto Perez told the Construction Review that these two buildings will be versatile enough to be used for warehouse/distribution, cold storage, light manufacturing or a combination.

The location is along the east side of the Schuylkill River in South Philadelphia, barely 3 miles from Philadelphia International Airport and its expanding cargo facility.

READ ALSO: What’s Ahead for Industrial?

Over a timeline of up to 10 to 15 years, the district is set to include a 14 million-square-foot campus, divided into two main areas: 250 acres dedicated to life sciences and 750 acres to industrial and logistics facilities, which are expected to total a whopping 10 million square feet. Preparatory site work, road enhancements and utility installations for the life science phase will begin next year.

Fiery history

Hilco acquired the 1,300-acre former Philadelphia Energy Solutions refinery out of bankruptcy in June 2020 for $225.5 million. The area had been the location of one or more refineries stretching back more than 150 years, and the history had included massive pollution and multiple fires.

The latest was a series of explosions in June 2019 that resulted in a massive fire.

In June of this year, Hilco celebrated the milestone of having demolished 93 percent of pipes, 89 percent of storage tanks and all of the process units at the site, while recycling more than 190,000 tons of material.

In what is presumably a nod to climate risk, regrading of the Bellwether District site will involve more than 2 million cubic yards of earth. This will be used to raise the whole site above the 100-year floodplain and all planned buildings above the 500-year floodplain.

A combination of very low demand from retailers and wholesalers and a steady delivery of new product has pushed metro Philadelphia’s industrial space market to a vacancy of 4.7 percent, 130 basis points higher than 12 months earlier, according to a second-quarter report from CBRE.

And though average asking rents rose over the same period, CBRE cautioned that this trend seems to be cooling, particularly with regard to Class A product.

The post $4B Mixed-Use District Breaks Ground in South Philadelphia appeared first on Commercial Property Executive.

Completed in 1994, Larkin’s Corner comprises four buildings on a 23.8-acre site. Image courtesy of JLL Capital Markets

SITE Centers Corp. has sold Larkin’s Corner, a 225,214-square-foot grocery-anchored retail center in Boothwyn, Pa. JLL Capital Markets brokered the transaction, working on behalf of the seller and procuring the buyer.

SITE purchased the asset back in 2016 for $27.1 million, according to CommercialEdge data. The same source shows that Wells Fargo Bank provided a $18.3 million CMBS loan.

Completed in 1994, the shopping center comprises four buildings on a 23.8-acre site. Anchored by Walmart and Acme, Larkin’s Corner was 99 percent leased at the time of the sale. The property’s tenant roster includes McDonald’s, Dollar Tree, TD Bank, Game Stop, T-Mobile, Arby’s and America’s Best.

With a weighted average tenure of 17.4 years and the addition of 168,000 square feet of new and renewed leases since 2019, the property counted approximately 2 million visitors in the last 12 months.

Larkin’s Corner is located at 601 Conchester Highway, in Delaware County. The shopping center is near Interstate 95, which provides direct access to downtown Philadelphia. According to information provided by SITE last year, the center serves nearly 150,000 residents within a couple of miles from the property, with an average household income of $77,784.

Senior Managing Directors Chris Munley and Jim Galbally, Managing Director Colin Behr, Director James Graf and Associate Patrick Higgins led the JLL Retail Capital Markets team.

SITE has recently sold Terrell Plaza, a 107,884-square-foot retail center in San Antonio. Property Commerce Divided Fund acquired the asset in a deal arranged by JLL.

The post SITE Centers Sells Philadelphia-Area Retail Center appeared first on Commercial Property Executive.

Hartford Corners is 95 percent occupied. Image courtesy of JLL

Haverford Properties Inc. has acquired Hartford Corners, a 214,896-square-foot retail center in Delran, N.J. JLL worked on behalf of the seller, Principal Asset Management, and secured financing for the buyer. According to CommercialEdge, the property last traded in 2016.

Located at 1330 Fairview Blvd., on 9.8 acres, Hartford Corners is 95 percent occupied. ShopRite, the property’s anchor tenant, has a tenure of 19.5 years, with 5.5 years remaining. Built in 2003, the center features a WALT of 4.1 years and a weighted average tenure of 13.8 years. Other tenants include Planet Fitness, Five Below, Virtua Health, Five Guys and Mattress Firm. Additionally, the property is shadow-anchored by Lowes.

Grocery-anchored shopping centers continue to drive the most demand among other retail asset classes, JLL’s Managing Director Colin Behr commented in prepared remarks. JLL’s Behr together with Senior Managing Directors Jim Galbally and Christopher Munley, Director James Graf and Associate Patrick Higgins were part of the team that represented the seller, while Managing Director Jim Cadranell led the JLL Retail Capital Markets Debt advisory team.

The post Haverford Properties Buys 215 KSF Retail Center appeared first on Commercial Property Executive.

Tri-State Industrial will total 525,000 square feet. Image courtesy of JLL

PCCP LLC and KPR Centers have secured a $56.3 million construction loan for the development of Tri-State Industrial, a facility totaling 525,000 square feet in Claymont, Del., in metro Philadelphia. JLL arranged the loan, which was provided by Principal Asset Management.

Tri-State Industrial will be rising at 401 Naamans Road and will include 40-foot clear heights, ample column spacing, 60-foot speed bays, ESFR sprinkler systems, LED lighting, four drive-in ramps, 99 dock doors, 130-foot truck courts, as well as ample vehicle and trailer parking space.

Located on 36 acres, the Class A warehouse facility will provide easy access to interstates 95 and 495, and the New Jersey Turnpike. The property is situated 9 miles from The Port of Wilmington, 11 miles from Philadelphia International Airport and within 26 miles of The Port of Philadelphia. Additionally, the industrial project’s access to the area’s highway transportation systems will allow easy access to more than 1.3 million consumers and to Philadelphia’s and Southern New Jersey’s workforce pool.

The JLL Capital Markets Debt Advisory team working on behalf of the borrowers was led by Senior Managing Director Chris Drew, Senior Director Mike Pagniucci and Director Michael DiCosimo.

A hotspot for industrial development in the Northeast

Philadelphia leads the major Northeastern markets for the amount of industrial space under construction, according to a recent CommercialEdge report. The metro had some 17.4 million square feet in its pipeline as of July, representing 4.1 percent of the local inventory, followed by New Jersey (with 9 million square feet underway) and Boston (with 5.5 million square feet).

Recent projects announced in the area include Foxfield’s Lower Bucks Logistics Hub, a two-property project totaling 814,567 square feet of Class A space. JLL Capital Markets arranged $114 million in non-recourse financing for the development. In July, DH Property Holdings secured $175 million financing for a 750,000-square-foot last-mile distribution project in Philadelphia. Completion is scheduled for late 2024.

The post PCCP JV Lands $56M for Philly Industrial Development appeared first on Commercial Property Executive.

I-76 Trade Center is slated for full completion in 2025’s first quarter. Image courtesy of Portman Industrial

Portman Industrial has acquired 169 acres in Exton, Pa., a Philadelphia suburb, to build I-76 Trade Center, a speculative industrial campus spanning 1.9 million square feet. Cushman & Wakefield brokered the deal on behalf of the seller, Audubon Land Development.

Site work is already underway and groundbreaking is expected this fall. KSS Architects designed the project, while Alston serves as general contractor, as reported by the Philadelphia Business Journal. Cushman & Wakefield is the property’s leasing agent.

READ ALSO: 5 Ways to Hold Down Construction Costs

To come online in two phases, the $330 million campus will comprise three facilities. Phase I will involve the construction of a 636,120-square-foot, cross-dock building with four drive-in doors, 110 dock doors, 146 trailer stalls and 508 parking spaces. Delivery is slated for August 2024.

Phase II will include a 1.1 million-square-foot facility along with another 154,440-square-foot building. Full build-out is expected in the first quarter of 2025.

The Cushman & Wakefield team that brokered the transaction included Vice Chairman Gerry Blinebury, Executive Managing Directors Jonas Skovdal and Director Christopher Butera.

A sought-after metro for industrial projects

Located at 1130 Pottstown Pike, the site is near Interstate 76 and roughly 35 miles west of downtown Philadelphia, providing access to the New Jersey Turnpike via interstates 76 and 95. The property is some 40 miles from the Philadelphia International Airport and 37 miles from the Port of Philadelphia.

Portman’s industrial portfolio currently comprises 8.1 million square feet of space across the U.S., in various stages of development. Recently, the company partnered with D2 Organization for another Philadelphia-area project.

Greater Philly had nearly 17.5 million square feet of industrial space under construction as of July, representing 4.1 percent of total stock, according to a recent CommercialEdge report. The metro ranked sixth in the nation for pipeline size.

The post Portman to Develop 1.9 MSF Philly-Area Industrial Project appeared first on Commercial Property Executive.

Fulton Bank, in conjunction with Nuveen Green Capital through C-PACE, financed $50 million, while the remaining $13 million was provided by WSFS Bank. Given the current debt market, MRA stated that this favorable financing reflects the strengths of both its portfolio and its relationships with financial partners.

This use of C-PACE (commercial property-assessed clean energy) financing reportedly is a first for MRA, but the company stated that given its commitment to developing energy-efficient buildings, this type of funding is likely to be sought again.

READ ALSO: Credit Disruption Boosts Green Financing

MRA will use the funds for its continued redevelopment efforts at CRISP, including renovated buildings for lab, R&D and advanced manufacturing uses. Additional plans for the campus include amenities such as a hotel, a fitness center, conference space, an outdoor amphitheater and space for food services.

Aerial view of Chestnut Run Innovation & Science Park in Wilmington, Del. Image courtesy of MRA Group

MRA acquired the former DuPont Chestnut Run Laboratory campus in November 2021. Currently, tenants including Solenis, DuPont, Prelude Therapeutics and Celanese occupy nearly 400,000 of the roughly 800,000 square feet on the campus intended for R&D, biopharma, advanced manufacturing and applied sciences users.

This infusion of funding will finance the redevelopment of about a further 120,000 square feet of space, an MRA spokesperson told Commercial Property Executive. He added that the tentative timeframe for the hotel is the first quarter of 2025.

Organic, but rapid growth

Metro Philadelphia is seeing a growing pipeline of biotech companies, including early-stage entities, all contributing to a level of demand that “is being met with 4 million square feet of new purpose-built lab space and conversions that have been announced or are under construction,” according to a recent report from Colliers. Clinical- and pre-clinical-scale biomanufacturing space is in especially short supply.

Among the projects aiming to meet all this demand are a 500,000-square-foot biomanufacturing facility in University City for Spark Therapeutics, a local start-up later purchased by Roche, and the 600,000-square-foot first phase of a 1 million-square-foot-plus pharmaceutical manufacturing campus for WuXi STA in Middletown, Del., Colliers reports.

The post MRA Group Sweetens Financing for CRISP Project appeared first on Commercial Property Executive.

Lower Bucks Logistics Hub is in Bucks County, Pa., near Philadelphia. Image courtesy of JLL Capital Markets

Developer Foxfield has obtained a $114 million loan from Mesa West Capital for the construction of its Lower Bucks Logistics Hub near Philadelphia. JLL Capital Markets arranged the non-recourse financing for the two-property, 814,567-square-foot project.

The two Class A facilities will come online at 1600 and 1620 E. Old Lincoln Highway in Langhorne, Pa. Upon completion, the buildings will have rear-loading and cross-deck configurations, 40-foot clear heights and a total of six drive-in doors, as well as upwards of 800 parking spaces for automobiles and trailers.

READ ALSO: Manufacturing Thrives Amid Construction Surges

The project’s location, near the I-95 corridor and the Pennsylvania Turnpike, ensures multi-directional highway access. The development site is 13.4 miles from Northeast Philadelphia Airport, 35.6 miles from Philadelphia International Airport and 22.4 miles from the Tioga Marine Terminal at the Port of Philadelphia.

JLL Capital Markets Senior Director Mike Pagniucci led the Debt Advisory team which advised Foxfield and arranged the financing. Mesa West Capital Executive Director Russell Frahm, Vice President Brian Hahn and Analyst Boyd Howard also worked on the deal.

Boston-based Foxfield invests in and develops primarily industrial and residential real estate across the East Coast. The firm has a $1 billion pipeline and upwards of 7 million square feet in assets under management or development.

One of the top northeastern markets for industrial development

Philadelphia led northeastern markets in industrial construction at the end of November, according to CommercialEdge data, with 21.5 million square feet of industrial space under construction, representing 5.3 percent of the existing stock. The second-place finisher, New Jersey, had only 13 million square feet underway at the time.

The metro had more than 20.2 million square feet in the development pipeline as of June, the same source shows. One of the ongoing projects is a 358,000-square-foot facility taking shape within First State Crossing, a 425-acre master-planned development in Claymont, Del.

More recently, DH Property Holdings received a $175 million financing package for a 750,000-square-foot last-mile distribution development in Philadelphia. Completion is scheduled for the fourth quarter of 2024.

The post Developer Lands $114M for Philly-Area Industrial Project appeared first on Commercial Property Executive.

Aerial view of Dekalb Plaza in East Norriton, Pa. Image courtesy of JLL

Abrams Realty & Development has purchased Dekalb Plaza, a 178,356-square-foot open-air retail property in East Norriton, Pa., for $23.1 million. JLL Capital Markets negotiated on behalf of the seller, Broad Street Realty, which picked up the property in 2013 for $9.4 million, according to CommercialEdge data.

Dekalb Plaza came online in 1977 on a 20-acre lot. Anchored by Big Lots and Urban Air, the retail center has a diverse mix of tenants such as Goodwill, Sally Beauty, Celebree School and Chick-Fil-A, among others. The property was 98 percent leased at the time of sale; since 2020, new commitments, extensions and renewals at the location totaled more than 96,000 square feet.

READ ALSO: Inside the Retail Stores of the Future

Located at 2640-2714 Dekalb Pike, the property is at the intersection of West Germantown Pike and Dekalb Pike, close to U.S. Route 202 and Interstate 476. The location is 21 miles from Philadelphia’s Center City and 27 miles from Philadelphia International Airport, in an area where the traffic count reaches some 22,000 vehicles per day. The retail center serves more than 178,600 people living within a 5-mile radius and having an average income of $135,391 per household.

Earlier retail deals near Philly

JLL Retail Capital Markets team of Managing Director Colin Behr and Director James Graf, together with Senior Managing Directors Christopher Munley and James Galbally, negotiated on behalf of Broad Street Realty. Behr, Munley and Galbally also assisted Federal Realty Investments Trust in the sale of a 124,626-square-foot retail center in New Britain, Pa. 

Despite the current economic conditions, the JLL team closed nearly $215 million in retail deals during the first half of 2023, Galbally said in prepared remarks. In one of the transactions, Goodman Properties, in partnership with The Provco Group, picked up a 134,980-square-foot, grocery-anchored shopping center in Warrington, Pa. 

The post Broad Street Realty Sells Philly-Area Retail Center appeared first on Commercial Property Executive.

The Plaza at Cherry Hill. Image courtesy of Urban Edge Properties

Savers has signed a lease at Urban Edge Properties’ Plaza at Cherry Hill, a nearly 422,000-square-foot retail center in Cherry Hill, N.J. The company committed to more than 25,000 square feet for its third store in Greater Philadelphia.

The deal brought the shopping center to 82 percent occupancy. Metro Commercial Real Estate‘s Rob Cooper and Shane Hart, together with Spence Mehl of RCS Real Estate Advisors, represented Urban Edge; Stephen Carrozza of Metro Commercial Real Estate  worked on behalf of the tenant.

Urban Edge acquired Plaza at Cherry Hill in 2017 for $51.2 million, according to CommercialEdge data. The 1968-built shopping center is set to undergo renovations that will include upgrades to the façade, landscape and parking lot.

Total Wine & More, Aldi, LA Fitness and Raymour & Flanigan anchor the property; the former recently leased more than 43,000 square feet at the location. The super-regional Cherry Hill Mall serves as shadow-anchor.

Situated on more than 42 acres at 2100 Route 38, the shopping center is 9 miles east of downtown Philadelphia. There are roughly 43,800 households within a 3-mile radius, earning on average more than $77,000.

Urban Edge currently owns 76 retail real estate properties totaling 17.2 million square feet. Earlier this year, the REIT obtained $290 million for the refinancing of a 1 million-square-foot mall in Paramus, N.J.

The post Urban Edge Properties Signs Philly-Area Tenant appeared first on Commercial Property Executive.

5000 Richmond St. Image courtesy of Walker & Dunlop

DH Property Holdings has received a $175 million financing package for 5000 Richmond St., a 750,000-square-foot last-mile distribution development in Philadelphia. The capital stack includes $40 million in partner equity and a $135 million construction loan from Massachusetts Mutual Life Insurance Co., public records show. Walker & Dunlop arranged both components of the funding.

DHPH broke ground on the two-building project in May and completion is scheduled for the fourth quarter of 2024.

Building A will total 348,210 square feet and Building B will total 411,000 square feet. Both will feature 40-foot clear heights, and between them they will offer 112 loading-dock doors, 206 trailer parking stalls and 759 car parking stalls. CBRE Senior Vice President Andrew Green and Vice Chairman Thomas Monahan will supervise leasing at the property.

READ ALSO: Bridging the Equity Gap With Preferred Equity

The project is just 6 miles from Center City and less than 1 mile from Interstate 95, while also providing access to interstates 276 and 476, and thereby to New York City and Washington, D.C. The 51-acre site is in a Qualified Opportunity Zone and benefits from a long-term tax abatement from the City of Philadelphia.

Walker & Dunlop’s Aaron Appel, Jonathan Schwartz, Adam Schwartz, Keith Kurland, Mo Beler, Michael Diaz, and Michael Ianno were exclusive advisors to DHPH and an undisclosed life insurance company.

Lacking nothing

Since early 2020, metro Philly’s industrial space market has hit record highs for absorption, new construction and asking rents, according to a first-quarter report from Newmark. Overall vacancy was just 4.3 percent, and availability remained low, especially in desirable submarkets, Newmark reported.

DHPH and Walker & Dunlop teamed up last September as well, when the latter arranged the $76.8 million refinancing of a recently completed 282,737-square-foot last-mile distribution facility in Philadelphia. The build-to-suit project is full occupied by TJX under a triple-net lease.

The post DH Property Holdings Obtains $175M for Philly Logistics Project appeared first on Commercial Property Executive.

Tac-Pal Logistics Center. Image courtesy of Avison Young

Sansone Group, together with a fund advised by Crow Holdings Capital, has signed a 252,000-square-foot lease with YesWay Logistics at Tac-Pal Logistics Center, an infill industrial building in Palmyra, N.J. Avison Young negotiated on behalf of the landlord, while Cushman & Wakefield worked on behalf of the tenant.

Sansone developed the facility and completed it last month. Its construction was financed with a $83.2 million loan, originated in 2022 by Goldman Sachs, according to CommercialEdge data. According to the owner, this is the largest infill development in Southern New Jersey.

Tac-Pal Logistics Center is a 702,450-square-foot building comprising 450,000 square feet of leasable space that is divisible to roughly 250,000 square feet. It has 40-foot clear heights, ESFR sprinkler systems, LED lighting, 107 loading docks, four grade level doors, a truck court, 438 vehicle parking spots and 255 trailer parking spots.

According to CommercialEdge, Sansone also has a potential development adjacent to this property, totaling 1 million square feet, which is currently in the planning and permitting stages.

READ ALSO: Industrial Leasing Trends for 2023

Situated on 55 acres at 201 S. State Route 73, within a Federal Opportunity Zone, the property provides easy access to interstates 95, 295 and to New Jersey Turnpike. It is 7 miles from The Port of Philadelphia, 12 miles from downtown Philadelphia, 21 miles from Philadelphia International Airport and within 27 miles of Trenton, N.J.

Avison Young’s team of Principals Matthew Marshall and Jim Scott, Associate Jack Owens, together with co-listing broker Executive Vice Chairman Chuck Fern of Cushman & Wakefield, negotiated on behalf of the landlord. The tenant was represented by Cushman & Wakefield’s Executive Vice President Jason Barton.

Recent Philly industrial projects

Philadelphia maintains its position as one of the most active markets for industrial development in the Northeast. As of May, it had 18.4 million square feet underway, representing 4.4 percent of existing stock, according to a CommercialEdge report.

Multiple industrial projects have been announced since the beginning of 2023. In June, First Industrial Realty broke ground on a 358,000-square-foot project situated within First State Crossing, a 425-acre master-planned development in Claymont, Del. Completion is expected in early 2024.

In January, D2 Organization announced its plans for three Class A warehouses that will bring 586,000 square feet in Carneys Point, N.J. The buildings will rise at the former Salem Business Center site.

The post Sansone Group, Crow Holdings Ink 252 KSF Philly Lease appeared first on Commercial Property Executive.

Twinbridge Center. Image courtesy of Wharton Industrial

Wharton Industrial, a platform company of Wharton Equity Partners, along with joint venture partner Walton Street Capital, have sold a 1.3 million-square-foot industrial portfolio in the Philadelphia area. An affiliate of DRA Advisors purchased the 37-asset collection for $194.5 million.

The portfolio, Twinbridge Industrial Park, also known as the Twinbridge Center, is located in Pennsauken, N.J., in proximity to Center City Philadelphia.

Twinbridge Industrial Park houses more than 50 companies. Some of the center’s tenants include Lennox, Nestle Waters, Cooper Electric, PepsiCo, Krannich and KONE. The majority of the properties are fully leased.

Buildings within Twinbridge Industrial Park range in size from less than 10,000 square feet to more than 75,000 square feet. Assets offer amenities such as drive-in dock doors and clear heights of as much as 24 feet.

Tenants are in proximity to dining, entertainment and retail opportunities in Center City Philadelphia, as well as throughout Camden County. Route 73 and U.S. Route 130 offer access to the larger New Jersey and Pennsylvania areas, while connecting the property to greater northeastern distribution routes.

Throughout the seller’s three-year ownership of the industrial portfolio, rents increased more than 100 percent. Approximately 80 percent internal rate of return was achieved by the sellers in the deal.

The sale marks one of New Jersey’s largest industrial deals so far in 2023.

CBRE’s Brad Ruppel, Mike Hines and Liam Fahey and Colliers‘ Marc Isdaner and Ian Richman represented the sellers in the transaction.

PGIM Real Estate provided DRA Advisors $103 million in fixed-rate financing for the acquisition. Tom Goodsite, managing director at PGIM, led the financing.

Philadelphia industrial boom

In 2022, the Greater Philadelphia area saw the most active industrial market in the Northeast, CommercialEdge data shows. As of the end of November last year, some 21.5 million square feet of space were under construction, demonstrating the market’s strong continued industrial demand.

Throughout the first half of this year, many companies have been expanding their Philadelphia industrial footprint. Dermody Properties recently purchased a 214,271-square-foot development in Woolwich Township, N.J. Hines also notably completed the purchase of a 501,600-square-foot property in Covington Township, Pa.

The post Wharton Industrial JV Sells $195M Greater Philadelphia Portfolio appeared first on Commercial Property Executive.

Image by Herbert Aust via Pixabay.com

First Industrial Realty Trust has commenced construction on a 358,000-square-foot industrial project situated within First State Crossing, a 425-acre master-planned development in Claymont, Del. The $60.5 million project is expected to be delivered in the first quarter of 2024.

The development team includes First Industrial’s Executive Director John Hanlon, Director of Development Jim Knopka, as well as Brandon Carney as construction manager. Blue Rock will serve as general contractor and Joseph Belluccia as principal architect. CBRE‘s Senior Vice Presidents Drew Green and Dan Rattay will provide leasing services.

READ ALSO: Expanding Into Industrial: Diversifying for Long-Term Success

The new logistics facility will rise on a 28-acre lot that the developer purchased for $11.5 million, according to the Delaware Business Times. The seller of the parcel within First State Crossing is Commercial Development Co. The development site is part of the former steel mill on which the 3.8 million-square-foot master-planned community will be developed. Commercial Development Co.’s $500 million project will include office, retail, industrial and residential space, and is expected to significantly impact the Philadelphia area’s economy.

The rear-load building will include 40-foot clear heights, two drive-in doors, ESFR sprinkler systems, LED lighting, 68 dock-high doors, 289 vehicle parking spots and 238 trailer parking spots. The distribution center will be designed to accommodate both single and multiple users across various industries, while also being the first commercial component within First State Crossing, noted First Industrial’s Hanlon, in prepared remarks.

Located at 4145 Philadelphia Pike, the industrial development is situated close to interstates 495 and 95, 9 miles from Port of Wilmington, 12 miles from Philadelphia International Airport, 24 miles from Philadelphia and within 54 miles of Trenton, N.J. Being developed at the midpoint of the I-95 corridor, the future distribution center will allow easy access to Washington, D.C., New Jersey and New York City.

Strong market fundamentals, future projects

Philadelphia had one of the most active industrial pipelines in the Northeast in 2022, according to CommercialEdge data. The metro had 21.5 million square feet of space under construction at the end of November 2022, representing 5.3 percent of the existing stock. Between January and November of last year, project starts totaled some 17.7 million square feet of space, accounting for 82.6 percent of the under-development pipeline.

Multiple industrial projects have been announced since the start of 2023. In spring, Portman Industrial and D2 Organization kicked off a 587,500-square-foot warehouse project in Carney’s Point, N.J., expected to be delivered in early 2024, after announcing plans for three Class A buildings encompassing 586,000 square feet in the same area in January. With D2 Organization as owner and developer, Salem Commerce Park landed $61.1 million in acquisition and predevelopment financing.

The post First Industrial Starts $61M Philadelphia-Area Project appeared first on Commercial Property Executive.

Iron Stone Real Estate Partners has completed the renovation of 180,000 square feet of space at Race Street Labs, a life science facility in Philadelphia. The site comprises two floors at the approximately 600,000-square-foot property. Both floors offer lab facilities. Cushman & Wakefield is marketing leases for the space.

Race Street Labs, located at 1421 Race St., has 580,000 square feet already leased. The newly upgraded space being marketed includes 13 floors of customizable built-in lab and office space, two full floors of speculative suites, HVAC climate systems, a backup generator, waste risers and circulating water facilities. Common-area amenities include security services, a ground-floor lounge area, conference rooms, food services, indoor bicycle storage facilities, shower and changing rooms, on-site lab management services and ample parking space.

READ ALSO: Exploring Redevelopment Opportunities Within Life Sciences

The upgraded asset is in Philadelphia’s Center City, near multiple subway and bus stations and close to the Philadelphia Convention Center, the University of Pennsylvania and Drexel University College of Medicine. The property is 11 miles from Philadelphia International Airport.

Cushman & Wakefield’s Paul Garvey and Brian Young are the leasing brokers in charge of marketing the property. The facility is one of the few purpose-built life science facilities in Philadelphia.

A life science boom in Philadelphia

Philadelphia is a rising life science leader. Other life science projects underway in Philadelphia include Breakthrough Properties’ 223,000-square-foot project, also in the Center City district. Corebridge Financial provided $130 million in construction financing for 2300 Market by Breakthrough, which is expected to deliver in the summer of 2024.

In February, SkyREM announced plans to build a $250 million mixed-use project on the city’s historic Quartermaster site. Those plans include 1 million square feet of dry and wet lab space for bio-manufacturing and R&D companies.

The post Iron Stone Wraps Up Philadelphia Life Science Revamp appeared first on Commercial Property Executive.

Rendering of 261 Swedesboro Paulsboro Road. Image courtesy of Cushman & Wakefield

Dermody Properties has purchased a 214,271-square-foot industrial development in Woolwich Township, N.J. Cushman & Wakefield made arrangements on behalf of the seller, Arbok Partners. The project is expected to be delivered in 2024.

Arbok bought the 14-acre development site for $2.7 million in 2021 for the construction of a new warehouse and distribution center, according to Courier Post. The property was previously home to a former Nike missile defense base which was active from 1957 to 1974.

Coming online at 261 Swedesboro Paulsboro Road, the industrial development was designed to include 40-foot clear heights, 39 dock doors, two drive-in doors, 169 vehicle parking spaces and 19 trailer parking spots. Situated some 15 miles from Philadelphia International Airport and 23 miles from downtown Philadelphia, the property is close to Interstate 295 and the New Jersey Turnpike, providing easy access to New York City, Baltimore, Md., and Boston.

Cushman & Wakefield Executive Vice Chairmen Gerry Blinebury and Gary Gabriel, together with Executive Managing Director Kyle Schmidt and Senior Analyst Brendan McGeary and assisted by Executive Managing Director John Gartland and Executive Director Jonas Skovdal, negotiated on behalf of the seller.

Earlier in June, the same company assisted a joint venture in the sale of a 501,600-square-foot industrial property in Covington Township, Pa. Hines paid $60 million for the asset.

Recent industrial activity in Philadelphia

Greater Philadelphia had the most active industrial market in the Northeast region in 2022, according to CommercialEdge data. The metro ranked first in terms of pipeline size, with 21.5 million square feet under construction at the end of November, representing 5.3 percent of the existing inventory; New Jersey (13 million square feet) and Worcester-Springfield, Mass. (10 million square feet) followed.

Year-to-date as of April, the metro had nearly 17.7 million square feet of industrial space underway, a recent CommercialEdge report shows. One of the projects that broke ground in the first four months of the year, a 587,500-square-foot warehouse in Carney’s Point, N.J., is slated for delivery in the first quarter of 2024.

Another development entered the pipeline in May, when DH Property Holdings commenced construction on a two-building, Class A industrial project in Philadelphia. Completion is expected in late 2024.

The post Dermody Properties Buys Philadelphia-Area Industrial Development appeared first on Commercial Property Executive.

Covington Logistics Center. Image courtesy of Portman Holdings

Hines has completed the purchase of Covington Logistics Center, a 501,600-square-foot industrial asset in Covington Township, Pa. Developer Portman Holdings and private equity company Rockpoint sold the property for $60 million, according to Lackawanna County public records. Cushman & Wakefield arranged the deal on behalf of the seller.

Located at 180 First Ave. in Gouldsboro, Covington Logistics Center features a 1,500-square-foot office component, 40-foot clear heights, LED lighting, four drive-in doors, 98 dock doors, ESFR sprinkler systems, 193 trailer parking spots and 267 vehicle parking spots.

All-Ways Pacific, a freight distribution company, signed a lease for the entire building this February. Cushman & Wakefield’s Executive Vice Chairman Gerry Blinebury and Senior Associate Collin Potter brokered the leasing arrangement on behalf of Hines and Portman.

The 36-acre property is near interstates 380 and 84, in the I-81/I-78 distribution corridor, 15 miles south of Scranton, Pa., 19 miles from FedEx Ground in Pittston, Pa., and within 56 miles of Bethlehem, Pa.

In January, Hines paid $127.4 million for Newark Distribution Center, a three-building, 738,000-square-foot industrial portfolio in Newark, N.J. The joint venture of Turnbridge Equities and Long Wharf Capital sold the assets.

The post Hines Pays $60M for Pennsylvania Industrial Asset appeared first on Commercial Property Executive.

Arcadia North. Image courtesy of Cushman & Wakefield

J.P. Morgan Global Alternatives has secured a $45 million floating rate loan for the refinancing of Arcadia North, a 1,050,701-square-foot industrial asset in Tobyhanna, Pa. Arranged by Cushman & Wakefield, the note was provided by Northwestern Mutual Life Insurance Co.

Situated at 2077 Corporate Center Drive W., Arcadia North is fully occupied by Lowe’s Home Center. The building, completed in 2020, features 105 dock doors, 316 parking spaces, 469 trailer parking spots, 36-foot clear heights and an ESFR sprinkler system.

READ ALSO: Paving the Way for Women in CRE: Insights From a Pennsylvania Broker

The property is close to Interstate 380, providing connectivity to interstates 80, 81, 83 and 84 and easy access to New York City, Pittsburgh, Baltimore and Washington, D.C. The location is also roughly 4 miles from a 1.2 million-square-foot warehouse under construction in Mount Pocono, Pa.

Cushman & Wakefield’s Equity, Debt and Structured Finance team of Steve Kohn, John Alascio, Alex Hernandez, Aaron Graves, TJ Sullivan and Jason Blankfein, secured the financing for the borrower. The Pennsylvania and New Jersey Capital Markets teams, led by Gerry Blinebury, Brendan McGeary, Gary Gabriel and Kyle Schmidt, provided support.

Southern New Jersey/Eastern Pennsylvania was the second-largest big-box region in North America at the end of 2022, with 493 million square feet of in its inventory, according to a CBRE report. The area’s development pipeline amounted to 45 million square feet as of December, only 18.3 percent of that space being preleased.

The post J.P. Morgan Lands Refinancing for 1 MSF Industrial Asset appeared first on Commercial Property Executive.

5000 Richmond St. site. Image courtesy of CBRE

DH Property Holdings has broken ground on its 5000 Richmond St. industrial project in Philadelphia. The two-building Class A development is expected to come online in the final quarter of 2024.

CBRE Senior Vice President Andrew Green and Vice Chairman Thomas Monahan will oversee leasing for the distribution facilities.

The infill site will combine modern logistics operations with inbound/outbound access, Green said in a statement, noting that the site is close to public transportation. The property, which is located within an Opportunity Zone, offers 10-year real estate tax abatements and will have efficient loading, parking and circulation.

READ ALSO: The Untapped Potential of NYC Industrial

Building A at the site will total 348,210 square feet, with column spacing of 50 by 56 feet, as well as 60-foot speed bays, 40-foot ceiling heights, 81 stalls for trailer parking, 42 loading dock doors and a single side load building. Building B will total 411,000 square feet, with similar column spacing to Building A and 125 stalls for trailer parking, as well as 70 loading dock doors.

Strong industrial development activity

Philadelphia had the most active industrial development scene of any Northeastern metro in 2022. There was a total of 21.5 million square feet of industrial space under construction at the end of November 2022, accounting for 5.3 percent of existing inventory. Construction starts between January and November of last year totaled 17.7 million square feet.

D2 Organization is among the companies that are constructing industrial space in the area, with three Class A warehouses totaling 586,000 square feet planned for Carneys Point, N.J., across the Delaware River from Philadelphia.

The post DH Property Kicks Off Philadelphia Industrial Project appeared first on Commercial Property Executive.

2300 Market by Breakthrough. Image courtesy of Breakthrough Properties

Breakthrough Properties has closed on $130 million in construction financing and gotten underway on a 223,000-square-foot life science building on Market at S. 23rd Street, in Philadelphia’s Center City district.

Breakthrough worked with Philadelphia-based D2 Capital Advisors to secure the construction loan from Corebridge Financial. With this financing now in place, Breakthrough is starting construction on the eight-story 2300 Market by Breakthrough.

The site is adjacent to the University of Pennsylvania and Drexel University, within a short walk of leading academic medical centers and steps from Philadelphia’s 30th Street Station and Rittenhouse Square.

2300 Market by Breakthrough is designed with flexible lab zones that can accommodate a wide range of research uses. The building’s amenities will include a café and lounge, fitness center and elevated terraces.

2300 Market by Breakthrough offers easy access to the SEPTA bus, trolley and commuter rail lines, as well as Amtrak routes connecting to New York City, Boston and the Washington metropolitan region via the William H. Gray III 30th Street Station.

The project architect is local studio KieranTimberlake, and Hunter Roberts is the construction manager. The development will include disassembling the original terra cotta façade of the 2314 Market building and then reinstalling it over the course of construction “to maintain an authentic streetscape that blends the old with the new,” according to Breakthrough.

The project was first announced in May of last year, and Breakthrough now anticipates delivering floors for the start of tenant fit-out in the summer of 2024.

Cushman & Wakefield’s Shane Funston and Jack Meyers are the building’s exclusive leasing agents.

Breakthrough Properties is backed by a joint venture of Tishman Speyer and Bellco Capital.

Growing despite pains

In a prepared statement, Breakthrough Properties co-founder & CEO Dan Belldegrun said that in recent years, Philadelphia has emerged as a leading research hub for pioneering new modalities in immunology, cell and gene therapy, and mRNA-based technologies.

Life science space leasing in Philadelphia was strong in 2022, according to a March update by Cushman & Wakefield, having increased to more than 1.6 million square feet, a 173 percent jump, year-over-year. However, the second half of last year was less active, because of rising interest rates.

The life science market is substantially undersupplied, Cushman says, in part because of a pause in conversions of office space to life science use, which again was affected by macroeconomic issues.

As a result, the update says, “Most of the notable deliveries have been ground-up, purpose-built projects in locations with an existing life sciences community.”

The post Breakthrough Properties Lands $130M for Philadelphia Project appeared first on Commercial Property Executive.

Site Plan. Image courtesy of D2 Organization

Portman Industrial, in a joint venture with D2 Organization, has broken ground on a 587,500-square-foot warehouse in Carney’s Point, N.J. Portman is handling construction and leasing efforts and plans to deliver the building in the first quarter of 2024. D2 Organization assembled the site from previous owners and secured development entitlements.

The partnership acquired the 49-acre site in January for $7.6 million, according to Salem County records. Georgia Bank Co. provided a $13.8 million acquisition loan. The site includes four parcels, encompassing 31, 13, 4 and 1 acres.

READ ALSO: Will CRE Construction Hold Steady in 2023?

The development will be situated along South Golfwood Avenue—14 miles from Wilmington, Del., and 31 miles from Philadelphia. The project will be constructed off Exit 4 of the Interstate 295 and Highway 48 interchange. Companies in the surrounding area include Walmart, Amazon, Goya Foods and Five Below Warehouse & Distribution Center.

Expanding Southern New Jersey’s footprint

In January, D2 Organization announced plans for three Class A buildings, totaling 586,000 square feet, called Salem Commerce Park. BridgeInvest provided $16.1 million in acquisition and predevelopment financing. In total, D2 Organization will expand Southern New Jersey’s industrial footprint by roughly 1.2 million square feet.

Salem County had an industrial inventory of 6.7 million square feet as of March, according to a CBRE report on the Philadelphia market. The county’s vacancy rate stood at 1.4 percent—300 basis points lower than the Philadelphia area. More than 2.1 million square feet of new space was under construction in the county.

The post Portman, D2 Break Ground on Philadelphia Project appeared first on Commercial Property Executive.

One Tower Bridge. Image courtesy of The Buccini/Pollin Group Inc.

The Buccini/Pollin Group Inc. has acquired One Tower Bridge, a 271,678-square-foot, Class A office tower in the Philadelphia suburb of Conshohocken, Pa. Oliver Tyrone Pulver Corp. sold the 92 percent occupied asset for nearly $68 million, according to CommercialEdge information. The company took out a $59 million loan from Citibank to finance the acquisition.

BPG intends to make capital improvements worth $9 million to the building. The revamp will involve the renovation of the garage and plaza, upgrades to common-area restrooms and corridors, enhancements to the ground level lobby, as well as exterior facade work.

The 15-story historic building was designed by Skidmore Ownings & Merrill in 1989. One Tower Bridge features 799 on-site parking spaces, a fitness center, an outdoor terrace and a multi-purpose room.

The property is located at 100 Front St., along the Schuylkill River. One Tower Bridge is anchored by Morgan Stanley. TheITSupportCenter, Lincoln Healthcare, Vector Data Services and Barton Investment Management also have leases at the property, CommercialEdge data shows. The property has a 65 percent retention rate for tenants who initially leased space.

Office sales thrive in the Northeast, but Philadelphia trails

A recent CommercialEdge report reveals that Northeastern markets are top performers for office sales volume, with investors closing deals worth $666 million in Boston, $423 million in New Jersey and $351 million in Manhattan during the first two months of 2023.

However, the office sector is facing headwinds due to both a volatile lending environment and the uncertainty around hybrid work, which gives it some exposure in the face of economic challenges. On the overall, the Philadelphia office market presents a more challenging environment compared to other cities in the region. According to the same report, sales in the metro totaled $148 million in the first two months of the year, with assets trading at $146 per square foot.

The post Buccini/Pollin Pays $68M for Suburban Philly Office Asset appeared first on Commercial Property Executive.

Image by Eduardo Soares via Unsplash.com

Lamar Cos. and Real Capital Solutions have acquired Village at Cambridge Crossing, a 128,000-square-foot retail center in Mount Laurel, N.J. Barings, the seller, had purchased the asset back in 2014 for $41.7 million, according to CommercialEdge.

Village at Cambridge Crossing encompasses nine one-story buildings completed in 1999, the same data provider shows. Anchored by LA Fitness, the retail center is home to a mix of tenants that includes FedEx, New Balance, LOFT, Chico’s, Panchero’s Mexican Grill and AAA Car Care, among others.

Village at Cambridge Crossing occupies almost 19 acres at 4010 Dearborn Circle, some 16 miles from downtown Philadelphia. The property is near the intersection of Interstate 295 and Route 38, in an area where the daily traffic count reaches approximately 50,000 vehicles. Rowan College at Burlington County and The Funplex are within 2 miles of the shopping center.

Several transactions involving retail assets have closed in the Philadelphia metro since the beginning of the year. In February, PREIT sold a 65,155-square-foot Whole Foods Market parcel in Plymouth Meeting, Pa., while a joint venture between Goodman Properties and The Provco Group paid $24.6 million for a 134,980-square-foot, grocery-anchored shopping center in Warrington, Pa.

In March, Milbrook Properties acquired a 124,626-square-foot, grocery-anchored retail center in New Britain, Pa. JLL Capital Marketsfacilitated the deal on behalf of the seller, Federal Realty Investment Trust.

The post Lamar Cos. JV Buys Philly-Area Retail Center appeared first on Commercial Property Executive.

Image by Marcin via pixabay.com

Scout Cold Logistics, an affiliate of AEW Capital Management, has purchased a 1.3 million-square-foot industrial building in Manchester, Pa. The 129-acre site is currently undergoing a 15-month construction and redevelopment process meant to transform the property into a grocery distribution facility.

Situated at 1025 Locust Point Road, the building has been leased to United Natural Foods Inc. to support its expanding footprint in the area. It will be temperature-controlled and feature automation and technology solutions that enhance UNFI’s network operating efficiencies.

A lifestyle center will be included in the Manchester facility, along with a cross-dock configuration, 492 trailer parking spaces and some 1,300 car parking spaces.

Located on the Interstate 83 corridor, UNFI will have access to I-76, I-81 and I-78, connecting the company to the Greater Northeast and Mid-Atlantic areas. Less than 15 minutes away is UNFI’s York facility, which is also supporting the company’s Mid-Atlantic region customer base. The added Manchester distribution center will contribute toward overall Pennsylvania network capacity and delivery efficiency.

The grocery-oriented acquisition is one of Scout Cold Logistics’ several recent portfolio additions, bringing the company’s total food-centric property investments to 24, with a combined footprint of 10.6 million square feet and representing approximately $1.9 billion of total capital commitments.

Pennsylvania distribution centers

Another distribution center in Reading, Pa., recently landed Can Corp. of America Inc., a steel can manufacturer and supplier, as a tenant. The company signed a 114,550-square-foot lease out of the total 392,030-square-foot property.

With some 40 percent of the nation’s population within a day’s drive, Pennsylvania distribution facilities are in high demand. In the larger Philadelphia area, the industrial facility occupancy rate remained more than 96 percent throughout last year, while asking rental rates increased, according to a Newmark report.

The post AEW Buys 1.3 MSF Distribution Center, Eyes Makeover appeared first on Commercial Property Executive.

405 Hurffville-Cross Keys Road. Image courtesy of Avison Young

Atkins Cos. has acquired a 70,140-square-foot medical office building in Sewell, N.J. Gordon Realty Management sold the asset for $13.3 million, according to CommercialEdge data. Principals Scott Martin, Jim Kornick, Michael Wilson and Erik Foster with Avison Young represented both parties in the deal.

Dubbed Kennedy Health & Wellness Center, the two-story facility came online on a 6.3-acre site in 2009. The property features a fitness center with an indoor swimming pool, medical practices and health education services.

The new owner plans to upgrade the finishes of the building and create additional clinical space to meet the demands of the medical office leasing market. The tenant roster includes Kennedy Fitness, Rowan Medicine and Pediatrics, Select Surgical Center and Future Chiropractic Center.

The property is located at 405 Hurffville-Cross Keys Road, directly across from the Jefferson Hospital Washington Township campus. The facility is 20 miles from downtown Philadelphia, in the southern New Jersey medical corridor.

Atkins Cos.’ portfolio currently totals six medical office buildings located in New Jersey and Pennsylvania. According to CommercialEdge data, one of the assets is approximately 1 mile away from the current acquisition.

The post Atkins Cos. Expands New Jersey MOB Footprint appeared first on Commercial Property Executive.

10 North Independence Mall West. Image courtesy of CommercialEdge

The Federal Reserve Bank of Philadelphia has signed a 55,000-square-foot lease renewal at 10 North Independence Mall West, a 775,000-square-foot Class A office building in Philadelphia. Architecture, engineering and interior design firm EwingCole will continue to operate its headquarters at the property. Newmark Executive Managing Director Jeffrey Tertel worked on behalf of the landlord.

Also known as the Federal Reserve Building, the eight-story property features eight passenger elevators, 75,000-square-foot floor plates, an outdoor dining area, building security, a conference room with 180 seats, a fitness center and covered parking.

Newmark’s Tertel and Executive Managing Director James Egan are the appointed leasing brokers in charge of the asset, CommercialEdge data shows. According to the same source, other tenants present at the property include law firm Mattioni and Healthcare Receivable Specialists.

The mid-rise tower is situated on an approximately 3-acre lot, close to interstates 95, 676 and 76, as well as multiple bus and subway stations. Located across National Constitution Center and close to Benjamin Franklin Bridge, the property is 4 miles from Camden, N.J., 10 miles from Philadelphia International Airport and within 30 miles of Wilmington, Del.

Recent office deals in Philadelphia

As of January, the market’s office vacancy rate reached 14.1 percent, below the national average of 16.6 percent, according to a recent CommercialEdge report. Year-over-year, Philadelphia’s office vacancy decreased by 40 basis points.

In December 2022, Keystone signed a 50,850-square-foot lease at 1K1, an 11-story office building in Conshohocken, Pa. The new tenant, a management consulting company, plans to move in at the suburban Class A location in the third quarter of 2023. Later that month, a partnership between Chubb and Parkway Corp. announced plans to develop a $430 million office tower in Philadelphia, with planned completion in early 2026. Insurance company Chubb will anchor the property.

The post The Federal Reserve Bank of Philadelphia Inks Lease Renewal appeared first on Commercial Property Executive.

Town Center of New Britain. Image courtesy of JLL Capital Markets

Milbrook Properties has acquired Town Center of New Britain, a 124,626-square-foot, grocery-anchored retail center in New Britain, Pa. JLL Capital Markets facilitated the deal on behalf of the seller, Federal Realty Investment Trust.

According to Bucks County public records, the asset traded for $13.2 million and Provident Bank provided a $8.7 million acquisition loan. CommercialEdge data shows that the property previously changed hands for $12.8 million in 2006.

Town Center of New Britain came online in 1990 and underwent renovations last year. Anchored by supermarket Giant—which has been a tenant at the property for nearly two decades—the retail center was 91 percent occupied at the time of sale. Recently, Giant extended its lease for another ten years and expanded into an adjacent vacant space.

The 19.7-acre property comprises a total of 23 stores and 625 parking spaces. Rite Aid, Dollar Tree, Verizon Wireless, Auto Zone, as well as other regional and national retailers are also on the roster.

READ ALSO: What Will Retail Look Like in 2023?

Located at 426 Town Center, the property is in a suburban infill retail corridor, at a signalized intersection along U.S. Route 202. Town Center of New Britain serves a population of 99,285 within a 5-mile radius, having an average household income exceeding $137,000.

Senior Managing Directors Christopher Munley and Jim Galbally, along with Managing Director Colin Behr, spearheaded the JLL Retail Capital Markets Investment Sales and Advisory team that acted on behalf of the seller.

Grocery-anchored assets continue to attract investor interest

The presence of a grocer like Giant at the property garnered significant interest from potential buyers, Behr said in a prepared statement. The retail shopping center sector remains a liquid asset class in the market, added Galbally.

Earlier this year, several transactions involving grocery-anchored assets closed in the Philadelphia metro. PREIT sold a Whole Foods Market parcel in Plymouth Meeting, Pa., while a joint venture between Goodman Properties and The Provco Group acquired a 134,980-square-foot shopping center in Warrington, Pa.

In another significant deal, a shopping center totaling 91,000 square feet in Marlton, N.J., changed hands through a 1031 exchange. Paramount Realty Services acquired the asset from its developer.

The post Milbrook Properties Acquires Philly-Area Retail Asset appeared first on Commercial Property Executive.

Logan North. Image courtesy of Greek Development

Greek Development has secured a $50 million refinancing for Logan North Industrial Park, a warehouse property in Logan Township, N.J., that is currently in expansion mode.

The loan, which replaces existing construction financing from Wells Fargo, will enable the company to apply long-term debt to Buildings A and F and Trailer Lot G at the 3.2 million-square-foot site. The developer partnered with “one of the largest life insurance companies” on the deal, Alex Motiuk, director of acquisitions at Greek Development, said in a statement. The company did not name the firm and its identity could not immediately be established.

READ ALSO: Are Industrial Construction Costs Moderating?

JLL sourced the refinancing loan. Senior Managing Directors Michael Klein, Jim Cadranell and Gregory Nalbandian and Associate Ryan Carroll worked on the transaction.

Greek Development has broken ground on a third phase at the Class A property. Expected to be the site’s final phase, the two-building addition has a build-to-suit opportunity of 200,915 square feet.

One building will be a 274,524-square-foot single-side load building that will have 40-foot clear ceiling heights, 42 dock-high doors, as well as 188 car and 58 trailer parking spaces. The second building will feature a 475,488-square-foot cross dock design with 40-foot clear ceiling heights, 106 dock-high doors and drive-in doors, as well as 244 parking spaces for cars and another 79 for trailers.

Expanding tenant roster

Of the existing facilities, Building A, which totals 164,317 square feet, is fully leased to logistics company Shearer Holdings and features 36-foot clear heights, 46 dock-high doors, 2 drive-in doors and 199 parking spots for cars. Building F and Lot G, with their combined 326,937 square feet, are situated on 11.36 acres and are fully leased to delivery company LaserShip. Lot G provides 264 trailer parking spaces. Building F, meanwhile, has 40-foot clear heights and 72 dock-high doors as well as two drive-in doors and 237 spots for vehicle, with another 109 for trailers.

In addition to Hearer and LaserShip, Target and Lineage Logistics are also Logan North tenants.

The property is strategically located in Southern New Jersey, bordering Route 322, to the north of Interstate 295, with easy access to both Philadelphia and New York. The site is 14 miles from Philadelphia International Airport and less than 20 miles from the Port of Philadelphia and the Port of Wilmington.

The post Greek Development Lands $50M Refi, Expands Property appeared first on Commercial Property Executive.

Creekview Center. Image courtesy of JLL Capital Markets

A joint venture between Goodman Properties and The Provco Group has paid $24.6 million for Creekview Center, a 134,980-square-foot, grocery-anchored shopping center in Warrington, Pa., public records show. JLL Capital Markets brokered the transaction on behalf of the seller, ShopCore Properties.

Shadow-anchored by Target and Lowe’s, Creekview Center features a diverse line of tenants, including Bank of America, LA Fitness, Petco, Wireless Experience, Easton Buffet, TGI Friday’s, Duron Paint, Chipotle, Jo-Ann and Easton Buffet.

Creekview Center is at 425 Easton Road in the North Philadelphia market, close to the intersection of Route 132 and Route 611. According to JLL, the property sits in an area where the daily traffic count reaches approximately 57,000 vehicles and the number of annual customer visits approaches 3 million.

Managing Director Colin Behr, together with Senior Managing Directors Christopher Munley and Jim Galbally, led the JLL Retail Capital Markets Investment Advisory team representing the seller. The same brokers recently negotiated a $27 million transaction on behalf of PREIT, which sold a 65,155-square-foot Whole Foods Market parcel in Plymouth Meeting, Pa.

The post Goodman Properties JV Buys Philly-Area Shopping Center appeared first on Commercial Property Executive.

Whole Foods Market at Plymouth Meeting Mall. Image courtesy of JLL Capital Markets

PREIT has sold the 65,155-square-foot Whole Foods Market parcel at Plymouth Meeting Mall in Plymouth Meeting, Pa., as part of its capital raising initiative. JLL Capital Markets brokered the $27 million transaction on behalf of the seller.

PREIT will utilize the funds generated from the transaction to reduce debt and enhance its balance sheet. According to CommercialEdge, Plymouth Meeting Mall is subject to a $384.5 million Wells Fargo Bank portfolio loan.

Whole Foods Market features a taco truck, a rooftop patio and dining areas. It also includes a parking garage with direct access to the market, a private event space and a Cold Point Pub venue. In 2009, the grocer signed a 20-year lease, and now has a remaining lease term of eight years, as well as five 5-year renewal options.

READ ALSO: PREIT’s CEO on the Rebirth of Malls

Having served almost 1 million customers in the last 12 months, Whole Foods Market neighbors other consumer traffic drivers at Plymouth Meeting Mall, including LEGOLAND Discovery Center, Plymouth AMC Theater and Dave & Buster’s. Located at 500 W. Germantown Pike, the property offers connectivity to Interstates 276 and 476, being exposed to an average daily traffic of 300,000 vehicles.

Senior Managing Directors Jim Galbally and Chris Munley, along with Managing Director Colin Behr, led the JLL Retail Capital Markets Investment Advisory team representing the seller in the transaction.

Grocery-anchored assets stir up investor interest

Investor interest in standalone grocery stores and grocery-anchored shopping centers remains robust, even as the capital markets landscape continues to change, Galbally said in a prepared statement.

According to a recent report by Cushman & Wakefield, the retail sector experienced growth in the fourth quarter of 2022, resulting in a historic low for the average shopping center vacancy rate. The figure dropped by 20 basis points to 5.7 percent, with net absorption reaching 10.9 million square feet.

In Philadelphia, a negative net absorption that totaled -117,539 square feet was registered, while vacancy stood at 6.9 percent.

Retailers are constantly striving to meet consumer demand, given changes in consumer behavior, economic uncertainty and ongoing supply chain challenges. Although supply chain issues are expected to improve this year, the supply-demand imbalance is likely to persist.

The post PREIT Sells Whole Foods Parcel in Philadelphia appeared first on Commercial Property Executive.

Rockefeller Group Logistics Center. Image courtesy of Rockefeller Group

Glendale Warehouse and Distribution Co. has acquired Rockefeller Group Logistics Center, a 345,600-square-foot warehouse in Mount Holly, N.J. The Rockefeller Group sold the newly completed property for $83 million. Cushman & Wakefield assisted the buyer, while CBRE negotiated on behalf of the seller.

Rockefeller Group broke ground on the project in November 2021, after purchasing the 27.6-acre development site that September. Blue Rock Construction served as general contractor and Menlo Engineering as civil engineer.

Designed by KSS Architects, the Class A facility features a 36-foot clear height, 54 dock doors with two-drive-in doors, LED lighting and 4,000 square feet of office space. The property has 96 trailer spaces and 384 auto parking spots.

Located at 2575 Route 206 in Eastampton Township, the warehouse is approximately 8 miles from Exit 7 of the New Jersey Turnpike and 27 miles from downtown Philadelphia. The facility also has access to interstates 95, 195 and 295.

Executive Vice Chairman Chuck Fern with Cushman & Wakefield represented the buyer. The CBRE team assisting the seller included Vice Chairman Tom Monahan, Associate Gerard Monahan, Executive Vice Presidents Stephen D’Amato and Larry Schiffenhaus, Client Service Specialist Lauren Hageman and Ana Lazarides.

New Jersey industrial space in demand

In 2022, New Jersey had a transaction volume of $3.42 billion in industrial properties, according to a CommercialEdge report. Despite an increase in sale price for this asset type and rising interest rates which lead to a decrease in sales volume in the second half of the year, demand for space remained high. New Jersey had an 8.4 percent increase in rents over the last 12 months, at a vacancy rate of 2.6 percent.

In one of last year’s major transactions, Brookfield Properties acquired a newly developed Class A property in Jackson, N.J., totaling more than 1 million square feet. Cushman & Wakefield represented the seller, a partnership of Active Acquisitions and Stonecutter Capital, and procured the buyer.

As for 2023 deals, a significant one closed last month, when Hines paid $127 million for Newark Distribution Center, a 738,000-square-foot industrial portfolio in Newark, N.J. The property was formerly home to a brewery originally built in 1900.

The post Rockefeller Group Sells Philly-Area Warehouse for $83M appeared first on Commercial Property Executive.

The Forge. Image courtesy of CommercialEdge

Vero A2R, a Dallas-based office investment platform of Vero Capital, has sold The Forge, a 160,000-square-foot office campus in King of Prussia, Pa., to an undisclosed buyer.

The property last traded in 2019, when Vero A2R acquired the office building for $16.5 million from Keystone, CommercialEdge data shows. The asset also became subject to a $15.2 million loan in 2020, with a maturity date set for 2030, provided by Citizens Financial Group.

Originally built in 1978, the two-building Class A campus was completely renovated in 2007. Following the 2019 acquisition, Vero A2R upgraded the three-story buildings by renovating the exteriors and lobbies, expanding the conference rooms and adding a tenant lounge. The property also features four passenger elevators, controlled access and 736 parking spaces.

During Vero’s ownership, occupancy increased to 93 percent. The tenant roster includes Greenphire, Broadview Networks, Goddard Systems and Medisys Solutions.

The office campus is located at 1016 W. 9th Ave., near the Benjamin Franklin Highway, providing easy access to interstates 76 and 276. Tenants have access to multiple dining options in the surrounding area. The Forge is also close to the Valley Forge National Historical Park, and within 22 miles from downtown Philadelphia.

The Newmark team facilitating the transaction included Senior Managing Directors David Dolan and Mike Margolis, Associate Angelo Brutico and Financial Analyst John Cook.

Philadelphia’s office sector performance

As of December 2022, Philadelphia’s office vacancy rate was 13.7 percent, a decrease of 70 basis points over the previous 12 months, and below the 16.5 percent national average rate, a recent CommercialEdge report shows.

With transactions slowing down in the second half of the year, Philadelphia’s office price per square foot for reached an average of $186 as of the end of 2022. Earlier this year, Ensemble Investments acquired two office buildings from Prologis in Wayne, Pa., in the King of Prussia submarket.

The post Philadelphia Office Campus Changes Hands appeared first on Commercial Property Executive.

The View at Marlton. Image courtesy of Institutional Property Advisors

Paramount Realty Services has acquired The View at Marlton, a 91,000-square-foot shopping center in Marlton, N.J., through a 1031 exchange. Institutional Property Advisors Senior Managing Director of Investments Brad Nathanson brokered the $36.5 million deal on behalf of the seller and developer, a joint venture between Abrams Realty & Development and Lazgor Co.

Paramount also assumed the existing mortgage on the property. According to CommercialEdge, The View at Marlton is subject to a $26.5 million loan from Argentic, set to mature in 2027.

A well-located shopping center

Anchored by long-term tenant LA Fitness, the asset was 98 percent leased at the time of sale. The shopping center’s roster includes AAA, The Malvern School, Truist Financial Corp., Euro Wax, Restore Cryotherapy, Dunkin’ Donuts, Naf Naf and Smoothie King, among others.

Completed in 2017 at 3001 Lincoln Drive, The View at Marlton serves an area that includes 6 million square feet of office space within a 3-mile radius, as well as the Philadelphia suburbs of Cherry Hill and Mount Laurel. The 11-acre property is alongside the busy Route 73, facing a Whole Foods Market and a medical center anchored by the Rothman Institute.

In a prepared statement, Nathanson said that Marlton has some of the highest retail rental rates in the Philadelphia metropolitan area due to its proximity to Philadelphia’s Center City and housing markets where average household incomes surpass $145,000 per year.

READ ALSO: What Will Retail Look Like in 2023?

The retail real estate sector remained robust during the final quarter of 2022, with persistent demand causing shopping center vacancies to reach an all-time low, according to a recent Cushman & Wakefield report. Across the country, the asking rents for shopping centers increased by 0.8 percent quarter-over-quarter to an average of $22.99 per square foot, while the vacancy rate dropped 20 basis points to 5.7 percent.

In Philadelphia, a negative net absorption of 117,539 square feet was registered in the fourth quarter of 2022, while vacancy stood at 6.9 percent, the same report shows. Asking rents clocked in at $20.62 per square foot, a 0.6 increase over the quarter.

The post Paramount Realty Buys Philly-Area Retail Asset appeared first on Commercial Property Executive.

Quartermaster Building 15. Image by FIFTEEN Design + Architecture, courtesy of Scheer Partners Inc.

Developer SkyREM is moving ahead with the conversion of Philadelphia’s historic Quartermaster site into the Quartermaster Science + Technology Park. The $250 million mixed-use redevelopment is slated to include 1 million square feet of wet and dry lab space for R&D and bio-manufacturing companies, in addition to restaurants, a boutique hotel and retail spaces.

Besides SkyREM, also on the development team is FIFTEEN, an architecture firm with experience in life science projects. MPN Realty is the retail broker for the campus, while Scheer Partners Inc. will be leasing the science and tech space.

SkyREM did not respond to a request by Commercial Property Executive for additional information.

A history-rich property

The site’s official address is 2724 S. 20th St. in South Philadelphia, but its origins go back well before the current city. What was originally the Schuylkill Arsenal was established in 1799 and produced uniforms, tentage, blankets and other textile items during the Civil War. From the 20th Street location, the depot provided textile products during World War I, World War II and the Korean War, as well as for the Civilian Conservation Corps during the Great Depression.

The 11 current buildings came online between 1939 and 1942. Uniform production moved to northeast Philadelphia in 1994, and the South Philadelphia site has been on the National Register of Historic Places since 2010.

The envisioned life science campus

SkyREM acquired the site in 2001. The 24-acre campus includes 6 acres of green space and an ALDI supermarket opening this quarter. The property houses a headquarters for Indego bicycle transit and has several other tenants in the healthcare and security sectors, for a total of 200,000 square feet currently occupied.

READ ALSO: Exploring Redevelopment Opportunities Within Life Sciences

The eventual six R&D buildings at Quartermaster Science + Technology Park will have industrial-style aesthetics like large factory windows, exposed ceilings and polished concrete floors. Most of the existing facilities are fully remediated and have heavy dual-feed power, while gas and water upgrades are currently underway.

The redevelopment will feature multiple public green rooftop spaces with renewable energy, for networking and social events. The buildings will be Energy Star- and LEED-certified; in addition, SKY Power, the developer’s renewable energy subsidiary, plans to build substantial rooftop solar to produce nearly all electricity for the campus.

The location, in South Philadelphia’s Point Breeze, offers convenient access to Interstate 76 and to public transportation via SEPTA bus routes 7 and G. Philadelphia International Airport is roughly 6 miles away.

A moderating sector

In a prepared statement, Tim Conrey, senior vice president of Scheer Partners’ Philadelphia office, touted the Philadelphia region’s status as a leading bioscience cluster, with 1.7 million square feet of current tenant demand for life science space.

This demand is generally cooling from its recent surge, according to a 2023 outlook from CBRE. So while construction continues apace in the top markets like Boston, the Bay Area and San Diego, markets in the secondary tier, including Philadelphia, “should see more stable conditions due to less new construction,” CBRE predicts.

This past December, Gattuso Development Partners and Vigilant Holdings obtained a $290 million construction loan to develop a 519,647-square-foot life science center in Philadelphia, reportedly to become the largest in the city. The lab space is 45 percent preleased to SmartLabs and Drexel University.

The post $250M Life Science Campus Planned at Historic Philly Site appeared first on Commercial Property Executive.

1000 Campus Drive. Image courtesy of D2 Capital Advisors

D2 Organization has received a $8.5 million loan for the refinancing of 1000 Campus Drive, an 81,400-square-foot office building in Collegeville, Pa. D2 Capital Advisors’ David Frankel and Jack Cortese arranged the financing through TriState Capital Bank.

Loan proceeds will be used for tenant improvements, capital expenditures, carry costs and leasing commissions in addition to paying off existing debt. CommercialEdge data shows D2 Organization purchased the property in 2017 with the help of a $10.3 million loan from Fulton Bank, also secured by D2 Capital Advisors.

READ ALSO: Sluggish Sales and Refinancings Cast Doubt Over Property Values

Completed on an 18-acre site within the 340-acre Providence Corporate Center, the four-story building used to be fully leased to Iron Mountain. In 2020, the owner came to an agreement with the tenant on a buyout of the lease that had several years left of its term.

The ownership plans to re-tenant the vacant office building, also having the possibility to build another 80,000-square-foot, on-site property. Cadence Real Estate Advisors’ Brendan Kelley and Ken Kearns are the listing agents.

Situated 1 mile from Providence Town Center shopping mall, the property is just north of Route 422, providing easy access to downtown Philadelphia.

In another recent financing deal, TriState Capital Bank has provided Ensemble Investments with funds for the acquisition of two office buildings totaling 203,887 square feet in Wayne, Pa. CBRE secured the financing.

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The Curtis. Image courtesy of Keystone

Keystone continues to transform The Curtis, an approximately 900,000-square-foot mixed-use tower in Philadelphia, into a premier life sciences destination. The company plans to repurpose 200,000 square feet at the 12-story building for laboratory use.

Following the planned reconfiguration of space, The Curtis will soon encompass a total of more than 325,000 square feet of laboratory offerings. The undertaking will also yield a handful of improvements including a new exhaust system, together with expanded hot water loops and steam infrastructure. Keystone intends to commence work on the conversion project in the first quarter of 2023, relying on proceeds from a $265.2 million loan the company obtained from Nuveen Real Estate in August 2022.

READ ALSO: Build-to-Suit or Adaptive Reuse? Meeting Lab Space Demand

Located at 601 Walnut St. in Philadelphia’s booming Center City, The Curtis first opened its doors in 1910 as the home of Curtis Publishing. In 2014, Keystone and Mack-Cali Realty Corp. acquired the property in a $125 million, all-cash transaction with the goal of repositioning the 12-story tower into a live-work-play destination. The partners maintained the 300-space parking garage, transformed roughly 90,000 square feet of the original office space into luxury residential units, reinvented 30,000 square feet of retail space and converted the former printing press area into more than 100,000 square feet of premier life sciences accommodations.

Calling all lab space

Philadelphia continued to hold its own as a leading life science cluster in the U.S. in 2022. “Despite tenant demand slowing in the latter part of the year, the Philadelphia region had one of its best leasing years with 1.5 million square feet of completed transactions through Q4,” according to a report by CBRE.

The future bodes well for the lab expansion at The Curtis. Conversion projects in Philadelphia outpaced new builds in the fourth quarter, and they also surpassed the pipeline of new construction in pre-leasing activity. As of the close of the fourth quarter, 47 percent of converted lab projects had been pre-leased, compared to just 29.5 percent for new developments.

The post Keystone to Add 200 KSF of Labs at Philly Landmark appeared first on Commercial Property Executive.

Michael Gallagher, Partner, The Flynn Co. Image courtesy of The Flynn Co.

The Philadelphia commercial real estate market has changed significantly in the past two decades. Events such as 9/11, the Great Recession and, most recently, the health crisis have all left their mark. Today, just like in most parts of the country, the metro’ office market is under a lot of pressure.

“A substantial amount of additional vacancy is anticipated as companies continue to downsize and scale back their footprint,” said The Flynn Co. Partner Michael Gallagher. However, both investors and tenants continue to eye quality assets in Philly’s urban core.

The Flynn Co. is one of the largest and oldest commercial real estate brokerage companies in Greater Philadelphia, having facilitated $3 billion in sales and lease transactions in the past 10 years alone. Commercial Property Executive asked Gallagher to talk about all the shifts he has seen in the metro’s office market and provide perspective on what might lie ahead.

READ ALSO: East Coast Office Sector Trends

How would you describe Philly’s office market today? 

Gallagher: The Center City Philadelphia office market is still trying to recover post-COVID-19 and determine its future within the current work-from-home environment. As is the case with the national office market, a lot of uncertainty remains as tenants try to figure out if and when they are going to return to the office, how many days per week, and at what percentage of their pre-pandemic footprint they will occupy.

While small- and medium-sized deals—2,000 to 20,000 square feet—are getting signed, it is at a much slower pace, and larger tenants—north of 20,000 square feet—are mostly stuck in neutral. Since 2019, less than 10 lease transactions greater than 50,000 square feet have been signed across the city.

Are there any areas of the metro that are more sought-after than others? 

Gallagher: Within the core of Center City, there definitely has been a “flight to quality” towards Class A and Class A+ office buildings as tenants take advantage of the volatility in the market. Most of the larger tenants that are relocating are downsizing between 15 percent to 20 percent of their existing space. Due to that rental savings, companies can justify paying a slightly higher rent in a much nicer building. Additionally, Class A landlords have been redeploying their capital and investing back into their buildings, and are now delivering much better amenities and efficiencies for these tenants.

The same flight-to-quality dynamics apply to the smaller and medium-sized firms that are taking advantage of relocating to nicer properties, but a lot of those companies are seeking out less traditional and creative four-to-six-story buildings. Firms feel it is “less stuffy” for their employees. This is an interesting trend that could continue to serve as a bridge between working from home and full-time office occupancy.

Rendering of Chubb’s upcoming 438,000-square-foot office building at 2000 Arch St. Image courtesy of Chubb

There is a widespread embrace of hybrid and fully remote working models. To what extent has this trend left its mark on Philly’s office market? 

Gallagher: Both the hybrid office working model and full-remote working model have had a significant and ongoing impact on Center City’s office market. A hybrid model of three to four days per week seems to be the evolution of the market with organizations like Comcast and local law firms embracing and encouraging the model for their employees. Full-remote work still seems to be in the experimentation stage as fewer firms are now going full work from home. There is no “normal” yet as office space dynamics differ from industry to industry, firm to firm and employee to employee. 

How has office vacancy fluctuated in the past 12 months across the metro?

Gallagher: The ongoing uncertainty in the economy and future of the workplace has had a significant impact on Center City’s office fundamentals. Through the third quarter of 2022, there was -750,000 square feet of net absorption in the market. The vacancy rate increased to 17.6 percent and the market continues to get flooded with sublease space, with over 2.5 million square feet of either direct sublet and/or “shadow space” coming back. Rental rates have remained mostly consistent with an average of $34.02 per square foot, buoyed in large part by the historically high cost of construction. 

But in spite of these increasing construction costs, Philadelphia’s pipeline of proposed billion-dollar-plus projects is still robust. How is all this construction activity impacting the metro’s urban core?   

Gallagher: From the health of an office market perspective, all new construction will have a very positive impact for Center City. Most promising and a silver-lining in the current market are the two new ground-up office buildings built/proposed by Parkway Corp. Morgan Lewis is preparing to move into their new 305,170-square-foot headquarter property at 2222 Market St. early this year. Additionally, Parkway is finalizing negotiations to develop a new 475,000-square-foot headquarters building for insurance giant Chubb at 20^th & Arch Street. Two new ground-up office developments coming online during and just after the pandemic is a phenomenal sign for the future of Center City and will help solidify the market’s foundation moving forward.

New residential construction continues to get built along North Broad Street and other burgeoning areas of the city, which helps bring new potential employees and tenants to the area. The success of the life science/biotech market in University City has been a great jolt of development, as well. Should the Sixers prove successful in developing their new arena along East Market Street, that would be a transformational project for that immediate area and the future of Center City. 

Philadelphia. Photo by Kelly Kiernan via Unsplash

You’re a Philadelphia native, with a very solid background in the metro’s commercial real estate market. How much has the metro’s CRE market changed since you started off in this business? 

Gallagher: I started with The Flynn Co. and in the commercial real estate business in the summer of 1999, so there have been many changes, cycles, and shifts in those 24 years. After 9/11, the office market and high-rise development was predicted to be wiped out and the fundamentals withstood that cycle, as well as the 2008 market crash. I think this market shift will be more significant since it’s a fundamental workplace change, but I remain extremely confident it will rebound yet again.

Technology is also at the top of the list. In addition to the obvious, its impact on the brokerage business, relationships and services that commercial real estate firms are now able to provide has been monumental. Commercial real estate has also thankfully finally started to gain steam and traction with its elusive diversification numbers with more female and minority brokers in the business. 

What are your expectations for Philly’s office market this year? 

Gallagher: In the immediate 12-month stretch, I think the Center City office market will continue to experience negative net absorption. There are approximately 3 million square feet of leases rolling in the next year along the West Market corridor alone and this will have an additional negative impact on vacancy rates and eventually start to compress rental rates. There will continue to be a flight to quality, so there will be deal volume but the overwhelming majority of signings will be considered a reduction in space.

Many are turning to office buildings getting converted to residential to solve the negative absorption issue, but with 10 million square feet of office buildings already converted since 2000, cost to convert and a lack of available supply are a concern. Along with these market trends, it will also be important to track the effect increased interest rates will have on landlords’ balance sheets.

The Philadelphia and Center City market will rebound as robust as ever, though. There will be stronger leadership and safety measures in place, and the strength and foundation of the city will be led by its many health-care and educational/institutional organizations, its location, amenities, and infrastructure.

The post A Broker’s View of the Philly Office Market appeared first on Commercial Property Executive.

Chubb headquarters. Rendering courtesy of JLL

Parkway Corp. has secured $409 million in credit tenant lease financing for the development of Chubb‘s new consolidated headquarters in Philadelphia’s Logan Square neighborhood.

UMB Bank, as trustee of the JLL Securities Credit Lease-Backed Pass-Through Trust, provided the fixed-rate, long-term note. JLL structured the construction-to-permanent loan on behalf of the developer.

As reported by PhillyVoice, Parkway also received $10 million in project financing from the Redevelopment Assistance Capital Program, facilitated by the Philadelphia Industrial Development Corp. Additionally, $3 million in state funds will go toward construction costs. The developer intends to break ground on the $430 million project in February, with completion expected in early 2026.

READ ALSO: East Coast Office Sector Trends

Set to rise at 2000 Arch St., the 438,000-square-foot office building will encompass various amenities, including a 6,000-square-foot outdoor terrace on the ninth floor and two levels of underground parking. The development site is close to Logan Square’s popular destinations such as City Hall, The Franklin Institute and the Barnes Foundation, and near the Suburban Station, which offers easy access to commuter rail and subway lines throughout the city.

According to a recent CommercialEdge report, there were approximately 2.3 million square feet of office space underway in Philadelphia as of December. The metro registered a 13.7 percent vacancy rate, 2.8 percent lower than the national one.

Adding more office jobs

Chubb intends to add more than 1,250 employees at its Philadelphia office, set to become its largest in North America. The firm pledged to generate and maintain a total of 3,200 jobs in Pennsylvania within five years after the opening. According to a JLL Philadelphia CBD Office Insight from the fourth quarter of 2022, this marks a notable increase in employment in the central business district of a city where the employment rate is currently at 98 percent of what it was before the pandemic.

READ ALSO: The CRE Workforce of the Future

The same source reveals that the upcoming development highlights the trend of businesses seeking higher-quality office spaces across all industries. Additionally, it shows Philadelphia’s ability to adapt and thrive despite changes in the way work is done, due to its vibrant atmosphere and talented workforce.

A team effort

The JLL team that worked on the financing on behalf of Parkway Corp. was led by Managing Director Austin Johnson and Senior Managing Director Bill Cavagnaro. In fact, several JLL teams worked together to finance the project, including the Agency Leasing team representing Parkway, the Tenant Rep team assisting Chubb, as well as the Project and Development Services team.

Additionally, JLL’s Structured Finance group in Atlanta, which focuses on credit tenant lease and ground lease financing, as well as other structured debt solutions for various property types, was also involved.

The post Parkway Lands $409M for Chubb’s Philadelphia HQ appeared first on Commercial Property Executive.

650 and 680 E. Swedesford Road. Image courtesy of Ensemble

Ensemble Investments has acquired two office buildings totaling 203,887 square feet in Wayne, Pa. The previous owner was Prologis, according to CommercialEdge data. CBRE negotiated on behalf of the seller and secured acquisition financing for the buyer from TriState Capital.

The purchase of the Wayne office buildings follows another high-profile Ensemble investment in the nation’s birthplace, a joint venture with Oxford Properties Group for the creation of a 3 million-square-foot life science hub. Additionally, the company is spearheading the $4 billion redevelopment of the city’s Navy Yard district.

The newest additions to Ensemble’s office portfolio

Both properties came online in 1998 at 650 and 680 E. Swedesford Road, respectively. The 101,627-square-foot building at 650 E. Swedesford underwent a cosmetic renovation in 2018 that added a new glass exterior, on-site café and fitness center.

In 2021, the building at 680 E. Swedesford was fully vacated, creating the opportunity for the owner to renovate it and bring it to Class A standards. Ensemble Senior Vice President Mark Seltzer said, in a prepared statement, that the firm has further leasing and redevelopment plans for both assets.

READ ALSO: Investment Activity to Decline in 2023: CBRE

Situated in Philadelphia’s King of Prussia submarket, the properties are close to numerous retail, dining, entertainment and hospitality options. Additionally, the complex is close to several local and state highways, such as the Interstate 76 and Route 202, offering quick access to much of metro Philadelphia; the city’s downtown area is 16 miles away.

TriState Capital Senior Vice President Dave Segal provided the acquisition financing that was secured by CBRE Senior Vice President Nick Harris, Executive Vice President Steven Doherty and Vice President Jake Helmig on behalf of Ensemble. Executive Vice Presidents Doug Rodio and Robert Fahey, as well as Senior Vice Presidents Jerry Kranzel and Bruer Kershner, represented the seller.

The post Ensemble Investments Buys Philadelphia-Area Office Buildings appeared first on Commercial Property Executive.

Salem Commerce Park. Image courtesy of D2 Organization

D2 Organization plans to build three Class A warehouse buildings totaling 586,000 square feet at the renamed Salem Commerce Park in Carneys Point, N.J. The Philadelphia-based investment group has recently acquired the 48-acre development site, an assemblage of four parcels, from the Delaware River & Bay Authority. American Dream Realty represented the buyer.

The site consists of three vacant parcels—3, 4 and 7 Collins Drive—at the former Salem Business Center, totaling 35 acres, together with an adjacent 10-acre lot at 1 Collins Drive and a neighboring 3-acre residential outparcel. The seller of the residential property was not disclosed.

BridgeInvest of Miami provided $16.1 million in acquisition and predevelopment costs financing. The debt was arranged by D2 Capital Advisors.

READ ALSO: Investment Activity to Decline in 2023: CBRE

Salem Commerce Park is immediately off Exit 4 at the Interstate 295 and Highway 48 interchange, 3 miles from the I-295 and New Jersey Turnpike interchange and 4 miles from the Delaware Memorial Bridge, making it a prime logistics location to fulfill Philadelphia, Southern New Jersey and Delaware markets. The site also provides easy access to New York City, Baltimore and Washington, D.C.

And D2 has more in store for the area. The firm is acquiring vacant land north of I-295 alongside Golfwood Avenue, according to Philadelphia Business Journal, with plans to build a 587,500-square-foot warehouse. Upon completion, the four new buildings would add nearly 1.2 million square feet of logistics space to South Jersey’s inventory.

Salem County rents for Class A industrial space has more than doubled since 2019 from approximately $5 per square foot to more than $11 per square foot, according to D2. The Southern New Jersey/Eastern Pennsylvania area has become the second largest big-box region in North America, with approximately 500 million square feet of total industrial inventory. Tenant demand remains strong with an overall vacancy of less than 2 percent in New Jersey.

Earlier deals

D2 Organization is a privately owned opportunistic investment group focused on acquiring and repositioning land for new development, including raw land, brownfields and excess or obsolete industrial facilities. Since 2019, D2 has successfully entitled more than 2.7 million square feet of industrial development projects in Salem County, N.J.

In May 2022, D2 sold a 282-acre project site in Pennsville, N.J., to CT Realty and PGIM Real Estate. Work is underway at Garden State Logistics Park, a two-building campus totaling 1.7 million square feet that is slated to come online in the third quarter.

The previous year, in October, D2 sold a 149-acre site in New Castle County, Del., to Logistics Property Co. Long planned as an industrial park, the 1.1 million-square-foot logistics campus is under construction on the metropolitan Wilmington, Del., area site, with completion expected in the second quarter of this year.

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Colliers

Formerly known as the Sacred Heart Hospital, 1430 Dekalb St. is a five-story institutional facility equipped with an adjacent parking area with 138 parking spots, now home to Montgomery County’s Department of Health and Human Services. The governmental tenant is occupying more than 125,000 square feet at the property.

The former hospital building is situated on a 3-acre lot, across from Norristown Regional Health Center and Children’s Hospital of Philadelphia’s Primary Care Center, close to interstates 276 and 476, 4.7 miles from King of Prussia, Pa., and within 20 miles of downtown Philadelphia.

Colliers Vice President of Investment Eric Grad, together with Flynn Co. and CBRE, negotiated on behalf of the undisclosed buyer. This is the first office sale in metro Philadelphia this year and also the first in Norristown since October 2022, according to CommercialEdge data.

The same data provider shows that a total of 728,978 square feet of office space changed hands in the last quarter of 2022 across the metro, at an average of $128.33 per square feet. In August 2022, Lakewood Equity sold a five-building, 185,000-square-foot office campus in suburban Philadelphia for $21.4 million.

The post Silverang Hallowell Sells 262 KSF Former Hospital appeared first on Commercial Property Executive.

Marple Commons. Image courtesy of CBRE

Maryland-based Thomas Park Investments has acquired Marple Commons, a medical office park totaling 57,760 square feet in Broomall, Pa. The previous owner, Hudson Cos., sold the asset for $11.6 million. The asset was purchased through the Thomas Park Growth Fund I, launched in late 2022 with a capacity to acquire $250 million in real estate.

According to CommercialEdge data, the property last traded in 2001, when Hudson Cos. purchased the buildings for $6.2 million. The same data provider shows the property was subject to a loan of $7.5 million as of 2015, provided by Deutsche Bank.

Senior Vice President Stephen Marzullo, Vice President Adam Silverman, alongside First Vice President Stephen Kriz of CBRE spearheaded the marketing of the park and represented the seller.

The three-building medical office park came online in 1985. The Class B property sits on 3.7 acres and includes three passenger elevators, controlled access and offers 289 parking spaces with a ratio of 5 spots per 1000 square feet. At the time of the sale, the facilities were 98 percent leased to a mix of 21 tenants, including Premier Orthopaedics, Children’s Hospital of Philadelphia, Kidney Care Specialists and Labcorp.

The property is located at 2000, 2002 and 2004 Sproul Road, roughly 12 miles from downtown Philadelphia, near Interstate 476. The medical campus is 6.7 miles from Mercy Fitzgerald Hospital and 7.2 miles from Lankenau Medical Center.

Last year, Thomas Park Investments partnered with Artemis Real Estate Partners to invest $500 million in the acquisitions of medical office buildings, with a focus on markets across the Mid-Atlantic and Northeast.

The post Philadelphia MOB Changes Hands appeared first on Commercial Property Executive.

Ashbridge Square. Image courtesy of Institutional Property Advisors

Kahn Development Corp. and J. Loew & Associates have acquired Ashbridge Square, a 386,248-square-foot power center in Downingtown, Pa. SITE Centers was the seller, according to CommercialEdge data.

Institutional Property Advisors, a division of Marcus & Millichap, brokered the deal. Managing Director Brad Nathanson represented the seller and procured the buyer.

SITE Centers purchased the multi-tenant property for $46.9 million in 2020, the same source shows. In 2019, the asset became subject to a $102.1 million loan originated by Wells Fargo Bank.

Completed in 2000, Ashbridge Square comprises five buildings spread across a 49-acre site. Anchored by Home Depot, the retail center was 88 percent leased at the time of the sale. Nathanson said in prepared remarks that the center’s tenant roster includes new leases with Dollar Tree, Staples, Ashley Furniture and Chick-fil-A, among others.

Located at 845 East Lancaster Ave., Ashbridge Square is near the conjunction of Route 30 and East Lancaster Ave., in an area where the traffic count can reach 19,456 vehicles daily.

IPA recently brokered another transaction in Pennsylvania. Prasavi Inc. acquired a 410,432-square-foot shopping center, for $66.5 million. The brokerage procured the buyer and negotiated on behalf of the seller, Cedar Realty Trust.

The post SITE Centers Sells Pennsylvania Power Center appeared first on Commercial Property Executive.

3201 Cuthbert St. Image courtesy of JLL Capital Markets

Gattuso Development Partners and Vigilant Holdings of New York have obtained a $290 million construction loan for the development of a life science center in Philadelphia, totaling 519,647 square feet.

JLL Capital Markets worked on behalf of the partnership to secure the financing through Corebridge Financial, while an additional equity commitment came from The Baupost Group.

Designed by Robert A. M. Stern Architects, the project is set to become the largest life science research facility in Philadelphia. SmartLabs and Drexl University have already secured space at the property, preleasing 45 percent of the available lab space. This deal marks SmarLabs’ seventh location in U.S., as well as its first commitment to expand outside Boston and San Francisco.

READ ALSO: Why the Life Sciences Boom Is Not Likely to Bust

JLL’s Capital Markets Debt and Equity Advisory team led by Senior Managing Directors Brett Segal, Ryan Ade and Christopher Peck negotiated on behalf of the borrowers.

Located at 3201 Cuthbert St., the 11-story building will include 519,647 square feet of wet and dry lab space, 11,908 square feet of ground-level retail space and 137 underground parking spots. The project will feature expanded floor-to-floor heights, HVAC systems designed for lab research, six enclosed loading docks, chemical storage space, Ph neutralization capabilities, lab-friendly column spacing, generous space for future tenants’ research equipment and vertical shaft infrastructure.

A growing life science market

The project is situated within Drexel University’s campus, in the University City District, close to Interstates 76 and 676, 2 miles from Philadelphia’s City Center and 8.9 miles from Philadelphia International Airport. Gattuso’s 3201 Cuthbert St. is targeting LEED Gold certification and it is expected to be completed in the first half of 2025. The development’s total cost is set to exceed $400 million.

University City is the core of Philadelphia’s life science market. The area is home to major players specializing in health care, biotech, the pharmaceutical industry and education. In recent years, the district has also grown into an international hub for cell and genes therapy.

Philadelphia is an emerging life science industry leader. The city’s talent pool ranks fourth nationwide, behind Boston, the San Francisco Bay Area and the New York City – New Jersey region, according to recent CommercialEdge data. In October, Children’s Hospital of Philadelphia and its partners broke ground on a 350,000-square-foot research facility in the city. The project is designed to achieve LEED Silver certification and will be situated next to the developer’s Roberts Center for Pediatric Research.

The post Gattuso Lands $290M for Philadelphia’s Largest Life Science Project appeared first on Commercial Property Executive.

Rendering of office building at 2000 Arch St. Image courtesy of Chubb

Insurance company Chubb, in partnership with Parkway Corp., has announced plans to develop a 438,000-square-foot office building in Philadelphia. Work is expected to commence in February 2023 and the project is slated for completion in early 2026.

According to the PhillyVoice, the office tower will cost $430 million to build, in which The Redevelopment Assistance Capital Program, provided by the Commonwealth and facilitated by the Philadelphia Industrial Development Corp., is contributing $10 million in construction costs. The same source mentioned that another $3 million are coming from additional state funds. Parkway Corp. is developing the 18-story tower, designed to achieve LEED Platinum certification, and Chubb will be the anchor tenant.

READ ALSO: Office Trends, Takeaways From SIOR CREate 360

The project will rise at 2000 Arch St., in downtown Philadelphia, less than 1 mile from City Hall, 1.2 miles from the University of Pennsylvania and within walking distance of the Franklin Institute. Future tenants will have access to nearby Logan Square Park and several dining options in the surrounding area. The Amtrak Philadelphia Station is located in the vicinity, only half a mile from the upcoming office building.

Tom Wolf, Governor of Pennsylvania, mentioned in prepared remarks the state’s investment in the project and what will be Chubb’s largest office in North America, leading to the creation of more than 1,250 jobs. Chubb’s involvement in Philadelphia is expected to create a workforce focused on roles in digital technology, finance, underwriting and claims. The project will also involve supporting jobs from local unions.

Demand for Class A office space

A third-quarter Cushman & Wakefield office report shows that, in the Central Business District, demand for Class A office space translated into roughly three-fourths of all leasing activity, with rates up 0.5 percent since the beginning of 2022 and 1.3 percent year-over-year.

Philadelphia had roughly 2.5 million square feet of office space under construction as of October, representing 1.4 percent of total stock, while the national supply pipeline accounted for 2.1 percent, according to a recent CommercialEdge office report.

Other major projects in Philly

Since the beginning of the year, several projects have received funding and broke ground in Philadelphia, particularly in the life science market. In August, Keystone landed a $265 million loan to expand the life science conversion of the Beaux Arts building, the former publishing headquarters of The Curtis in Philadelphia. Earlier in October, a Children’s Hospital joint venture broke ground on a 350,000-square-foot facility, slated for completion in 2025.

Another joint venture, this time including National Real Estate Advisors, JOSS Realty Partners, SSH and Young Capital, secured $260 million for the development of a mixed-use project in the central Market East neighborhood of Philadelphia. Upon completion, investment in the project is expected to exceed $1 billion.

The post $430M Office Tower Coming to Philadelphia appeared first on Commercial Property Executive.

1K1

Keystone Development + Investment has landed a new tenant at 1K1, an 11-story office building in Conshohocken, Pa. Management consulting company CBIZ Inc. signed up for 50,850 square feet at the property and plans to move to the suburban Philadelphia location in the third quarter of 2023.

Seamus Byrne, Eric Galanti and Bill Main of CBIZ Gibraltar Real Estate Services, along with Ryan Conner of Tactix, represented the tenant, while Keystone’s Rich Jones and Tom Sklow worked on behalf of the landlord.

Keystone acquired the 253,985-square-foot asset from Arden Group in 2019. According to CommercialEdge data, at the time of the sale the property became subject to a $53 million loan, provided by Varde Partners, with a maturity date set for 2029.

The company owns 22 office buildings in the Philadelphia market, totaling approximately 5.4 million square feet, the same data provider shows. According to the latest CommercialEdge national office report, Philadelphia’s vacancy rate hit 14.2 percent in November, up 200 basis points year-over-year, and below the national average, which stood at 16.3 percent that month.

A modern office in suburban Philadelphia

Built in 1988, the Class A property underwent cosmetic renovations in 2014. After purchasing the asset, Keystone launched a multimillion-dollar renovation plan, turning 1K1 into the first building in the market that uses artificial intelligent dynamic smart glass technology, significantly cutting energy costs.

Located at 1001 Conshohocken State Road, the property is next to Interstate 76 and 13 miles from downtown Philadelphia. Tenants have access to dining options in the surrounding area, while Conshohocken train station is less than 1 mile away. Building amenities include a conference room, outdoor terrace, fitness center and a café. The current tenant roster comprises Plan Management Corp., Advantexe and Burns White, among others.

The post Keystone Inks 51 KSF Lease at Philadelphia-Area Property appeared first on Commercial Property Executive.

Rendering of 2201 E. Allegheny Ave.

FreezPak Logistics, through their new partnership, BGFP International, has landed construction financing in the amount of $72.6 million for a new cold storage facility in Philadelphia.

The 172,000-square-foot industrial project will be occupied by the company and is funded by two lenders. BGFP International is a joint venture set up between BG Capital and FreezPak Logistics

The speculative development will be located at 2201 E. Allegheny Ave., on a 7.2-acre site, in Philadelphia’s Port Richmond neighborhood, close to Interstate 95 and Betsy Ross Bridge, 5.4 miles from downtown Philadelphia and within 14 miles of Philadelphia International Airport. The speculative project will feature controlled-temperature, 30 trailer parking spots, 20 loading docks and 60 car parking spots.

The partnership acquired the development site from Manufacturers and Traders Trust Co. in 2020 for $10 million, according to CommercialEdge. Construction has started on the development and completion is set for October 2023.

Financing details

OceanFirst Financial Corp. subsidiary, OceanFirst Bank, provided $42.5 million in construction financing as the senior lender, while Nuveen Green Capital provided $30.1 million in the form of Commercial Property Assessed Clean Energy financing, an alternative debt solution used for energy efficiency developments, with the goal of reducing the CO2-e annual footprint. While making the future cold storage building 30 percent more efficient than the state’s building energy code’s requirements, this also marks the largest C-PACE deal in Pennsylvania, said BG Capital’s Vice President Tyler Huffman, in prepared remarks.

The project’s capital investment is estimated to exceed $93 million and is expected to bring 63 new jobs to the Port Richmond and Harrowgate neighborhoods, with its Market-Frankford Line location making commuting easy for future employees. The industrial sector has good prospects going into 2023, according to CommercialEdge’s latest national industrial report.

Regarding new supply, Philadelphia has the largest construction pipeline in the Northeast, with 16.7 million square feet of industrial space under construction as of October, followed by New Jersey, Boston and Baltimore. A high-profile financing deal happened in the area: in January, Hilco Redevelopment Partners and its partners secured a $500 million financing for The Bellwether District’s redevelopment, a 15 million square-foot industrial park.

The post BG Capital, FreezPak Logistics Get $73M for Philadelphia Project appeared first on Commercial Property Executive.

Lehigh Valley Trade Center

ID Logistics, an international contract logistics company which began a U.S. expansion in 2019, has leased a Bethlehem, Pa., distribution facility. The Lehigh Valley Trade Center, where IDLogistics will occupy 526,662 square feet, is being developed by Trammell Crow Co. and Clarion Partners.

Colliers managed the land acquisition, initiated a marketing campaign and found the tenant for the Lehigh Valley distribution and fulfillment campus.

READ ALSO: Top 5 Industrial Transactions in Chicago

The new space will serve as a distribution center for a global food corporation that uses IDLogistics as a contract logistics provider. Located at 4939 Hanoverville Road, the center is in proximity to other occupiers including Stitch Fix, Tesla, and the largest FedEx sorting facility in the U.S.

The building is expected to be completed this year. According to CommercialEdge data, the lot size for the facility is 29.4 acres. The property features a 185-foot truck court, loading doors, cross docks, dock levelers, dock bumpers, ESFR fire sprinklers and maximum clear heights of 40 feet.

Two of the other buildings in the Lehigh Valley Trade Center were completed in 2016, according to CommercialEdge data. One of the properties, located at 4779 Hanoverville Road, is a 297,650 square foot building currently occupied by Shipbob and Wasserstrom. The other property, located at 4868 Hanoverville Road, is 947,548 square feet with PAC and Barry Callebaut as tenants, according to the same data.

The third phase of the Lehigh Valley Trade Center has begun following the signing of the IDLogistics lease. Two new buildings, which will be 287,445 square feet and 300,153 square feet, are scheduled for completion before the end of 2023.

Mark Chubb, Michael Zerbe and Summer Coulter with the Colliers’ logistics and transportation team for Eastern Pennsylvania worked on the deal. Colliers has recently expanded its national property management business through the acquisition of Arcadia Management Group Inc. Set to rebrand under Colliers’ name, Arcadia’s team focuses on southwestern markets.

The post Trammell Crow, Clarion Land Logistics Tenant in Lehigh Valley appeared first on Commercial Property Executive.

Schuylkill Avenue Research Building. Image courtesy of Children’s Hospital of Philadelphia

A partnership between the Children’s Hospital of Philadelphia, Gilbane Building Co., Pride Enterprises and McKissack & McKissack has broken ground on Schuylkill Avenue Research Building, a 350,000-square-foot facility in Philadelphia. Cannon Design served as architect for the project that has a delivery date set in 2025.

Designed to achieve LEED Silver Certification, Schuylkill Avenue Research Building will take shape atop an existing parking garage next to CHOP’s Roberts Center for Pediatric Research. Once complete, the 14-story facility will encompass more than 33,000 square feet of office and 257,630 square feet of laboratory and research space, as well as 6,500 square feet of retail. The building’s second floor will comprise conference rooms, a lecture hall and collaboration space.

Situated at 2716 South St., the 8.5-acre development site is within half a mile of the Children’s Hospital of Philadelphia and the Hospital of the University of Pennsylvania, as well as several life science centers. The location is also close to Schuylkill Expressway and Interstate 76.

Even though Boston, San Diego and San Francisco are still national leaders in terms of laboratory space development, Philadelphia stands out as an emerging life sciences hub, especially due to its top-tier research centers. And the city’s life science pipeline is about to get bigger, as Longfellow Real Estate Partners and The University of Pennsylvania teamed up for the development of a $365 million, 455,000-square-foot facility. The building will come online in 2025 inside the 23-acre Pennovation Works ecosystem.

The post Children’s Hospital JV Breaks Ground on Philadelphia Research Center appeared first on Commercial Property Executive.

2801 Red Lion Road. Image courtesy of Colliers

International Vitamin Corp. has signed a full-building lease with First Industrial Realty Trust for a 180,171-square-foot industrial facility in Philadelphia. IVC will move into the building in the first quarter of 2023, after the existing tenant, TJX, relocates to a larger facility at 9801 Blue Grass Road, just 2 miles from the current location. Colliers Senior Managing Director Richard Gorodesky and Senior Associate Adam Gorodesky represented the landlord.

First Industrial acquired the property in 2005 for $7.1 million, CommercialEdge data shows. Built in 1969 and renovated in 2011, the warehouse at 2801 Red Lion Road is one of the largest single tenant industrial facilities in Philadelphia. The facility features 20- and 26-foot clear heights, 25 dock doors and a truck court, as well as some 13,800 square feet of office space.

The 10.9-acre property is just off Roosevelt Boulevard, with Northeast Philadelphia Airport 2.5 miles away and 15 miles from downtown Philadelphia. Other industrial facilities in the area include Atkore, Quaker Valley Foods, Veho Philadelphia, Marshalls Distribution Center and United Refrigeration, among others.

First Industrial Realty Trust’s national industrial portfolio totals roughly 69.8 million square feet across 443 properties. In Philadelphia, the company currently owns 16 facilities, both completed and in various stages of development.

The post First Industrial Inks Full-Building Lease in Philadelphia appeared first on Commercial Property Executive.

9801 Blue Grass Road. Image courtesy of Walker & Dunlop

Walker & Dunlop has completed the $76.8 million refinancing of 9801 Blue Grass Road, a newly constructed 282,737-square-foot last-mile logistics facility in Philadelphia.

Walker & Dunlop represented the building’s developer and owner, DH Property Holdings. Funding was provided by Invesco Real Estate and Webster Bank.

9801 Blue Grass Road was constructed on a 22.3-acre lot, home to a former baked goods manufacturer. The building’s construction is subject to a $62 million loan, according to CommercialEdge data.

The Class A build-to-suit facility is fully occupied by TJX as part of a triple net lease. The property’s features include 36-foot and 53-foot clear heights, as well as 141 grade-level car and trailer parking spaces, CommercialEdge data shows.

Situated adjacent to Roosevelt Boulevard, the facility is within 15 miles of downtown Philadelphia, with quick shipping and delivery access to the entire Philadelphia metropolitan area. Additionally, it is connected to the I-95 and I-76 highways, placing it within a day’s drive of the entire U.S. Mid-Atlantic region.

Philadelphia’s industrial sector pulls ahead

Philadelphia remains a leading market for industrial development and investment, with 11.8 million square feet of space in its construction pipeline, and $1.3 billion in sales transactions, according to a July 2022 report from Yardi Matrix. Demand for industrial and logistics space continues to outpace supply, with the city having a vacancy rate of 5.8 percent, data from the same report shows. Another industrial undertaking in the Philadelphia area is the redevelopment of The Bellweather District, a 15 million-square-foot mixed-use industrial park in the city’s South Philadelphia district.

READ ALSO: What’s Driving Industrial Property Management Today

The Walker & Dunlop team was led by Senior Managing Directors Aaron Appel, Jonathan Schwartz, Keith Kurland, Adam Schwartz and Michael Ianno.

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The Curtis. Image courtesy of Keystone Development + Investment

Keystone Development + Investment has secured a $265.2 million loan from Teachers Insurance and Annuity Association of America (TIAA) affiliate Nuveen Real Estate, to expand the life science conversion of landmark former publishing headquarters The Curtis in Philadelphia.

Part of the funding will be used for infrastructure upgrades and leasing costs at The Curtis, and another portion is intended to enable Keystone to convert the next 200,000 square feet at The Curtis to cGMP (current Good Manufacturing Practices) and research laboratories over the next several years.

The Beaux Arts structure at 699 Walnut St., in the Washington Square West neighborhood, was built in 1910 as the Curtis Publishing Co. headquarters. Curtis’ best-known periodical was probably The Saturday Evening Post, a major mass-market weekly magazine with a circulation of 2 million or more from the 1920s into the 1950s.

READ ALSO: Build-to-Suit or Adaptive Reuse? Meeting Lab Space Demand

After purchasing the 12-floor, 912,245-square-foot building in 2014, Keystone renovated the property with a ground-floor streetscape and building atrium, the conversion of existing office space to luxury residential units, and the conversion of former printing press space to wet lab space for life science companies like IMVAX, Vivodyne and Aro Biotherapeutics.

BioLabs, which provides flexible biotech lab space and services, selected The Curtis for their 53,000-square foot Philadelphia incubator and graduate suites facility. The space offers emerging life science companies turnkey support and a full growth pipeline in one location.

The Curtis’ physical features that suit it for life science companies include 15-foot-plus ceiling heights, 200 psf vibration-resistant floors, multiple fresh air intakes, a dual power supply, dedicated laboratory backup emergency power, multiple loading dock bays and freight elevators, and numerous venting chases. Amenities include a tenant meeting and lounge suite, a 300-space covered parking garage, childcare center, 24-hour card access and on-site 24/7 security.

Solidly positioned

Philadelphia ranks in the top five U.S. life science space markets for market inventory (third, at 21.3 million square feet), 2021 absorption (fifth, with 663,000 square feet), and space under construction (fourth, at 2.2 million square feet) and proposed (third, at 9.7 million square feet), according to a spring market snapshot from Colliers.

The metro is also well positioned with respect to a low 3.8 percent average vacancy for life science space and for having attracted $2.4 billion in venture capital funding for life science entities.

In May, Breakthrough Properties, a joint venture of Tishman Speyer and Bellco Capital, announced plans to redevelop a one-block site at 2300 Market St. in Philadelphia as a 200,000-square-foot life science campus.

The post Keystone Lands $265M Loan to Expand Philly Life Science Conversion appeared first on Commercial Property Executive.

Logan Township Industrial Park site. Image via Google Earth

Stalwart Equities has obtained $42.8 million in financing to assist with the purchase of the Logan Township Industrial Park development site in Logan Township, N.J., roughly 25 miles southwest of Philadelphia. Relying on Cushman & Wakefield as its exclusive advisor, Stalwart secured the acquisition loan for the 171.3-acre property from SKW Funding.

The Logan Park site, located off Route 130 near Interstate 295 and the New Jersey Turnpike, consists of a handful of parcels, the largest of which encompasses 166 acres along Nortonville Road. According to Gloucester County records, the sizeable stretch of land and four other parcels had belonged to Keystone Urban Renewal LP, an entity with the same address as the headquarters of Starwood Property Trust.

READ ALSO: Top 5 Markets for Industrial Deliveries in 2021

The Cushman & Wakefield Equity, Debt & Structured Finance team that represented Stalwart in procuring the bridge loan included John Alascio, Chuck Kohaut, TJ Sullivan and John Spreitzer. According to Alascio, the combination of Logan Park’s location in Southern Jew Jersey’s bustling industrial market and Stalwart’s strong sponsorship attracted significant lender interest that translated into highly competitive financing terms.

Space needed

Logan Park is zoned to accommodate in excess of 1 million square feet of industrial space in two distribution facilities, and all signs indicate that the timing is right for such an addition to the market.

“To meet the constant demand for big-box space, the average footprint of new development projects has persistently risen by almost 40 percent since 2019, as Southern New Jersey has transformed into a dynamic warehouse and distribution hub in the Northeast,” according to a fourth quarter 2021 report by Cushman & Wakefield.

In 2021, Southern New Jersey accounted for a whopping 72 percent of the Greater Philadelphia region’s annual leasing activity, with e-commerce and logistics tenants seeking additional space for expansions in the face of rising transportation costs, according to the report. The vacancy rate in Southern New Jersey, as well as in Gloucester County, closed the year at under 1 percent.

Logan Park is on schedule to be entitled for development within the next 12 to 18 months. The project will yield a Class A distribution campus with cross-docking capability and 40-foot clear ceiling heights, as well as ample trailer and car parking.

Upon completion of the project, Stalwart will likely find a receptive audience of prospective tenants, and the company will be able to charge a pretty penny for the space, too. “Historically tight market conditions are anticipated to persist, and strong absorption totals should outstrip new deliveries, with rental rates projected to rise to new historical heights,” according to the Cushman & Wakefield report.

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East Market. Image courtesy of JLL

A joint venture between National Real Estate Advisors, JOSS Realty Partners, SSH and Young Capital has secured a $260 million refinancing loan for East Market, a multi-phased, mixed-use project in Philadelphia. Pacific Life Insurance Co. provided the financing, while JLL Capital Markets represented the joint venture.

East Market, spanning from Market to Chestnut and 11th to 12th streets, occupies an entire city block and features retail, dining, office, living and hospitality spaces. The project has two multi-housing buildings encompassing 562 units, as well as 120,000 square feet of retail, an office redevelopment and 177 underground parking spaces. Upon completion, the property will encompass more than 1 million square feet, with a total investment exceeding $1 billion.

A big development in the heart of the city

The housing component, comprising The Ludlow and The Girard at 1101 and 1199 Ludlow St., respectively, was completed in 2018 and 2019. The Ludlow features 322 units in a mix of studios, one- and two-bedroom floorplans ranging from 466 to 963 square feet, according to Yardi Matrix data. The Girard offers 240 units in a mix of one- and two-bedroom floorplans ranging from 545 to 1,238 square feet, according to the same data provider. Community amenities for both properties include a fitness center, business center, clubhouse, playground, media room and pool. The Girard is LEED Silver certified.

The project also includes the adaptive reuse of a warehouse building dating back to 1916. The structure at 1100 Ludlow Street was converted into 160,000 square feet of rentable office space, with 25,257-square-foot floorplates, according to CommercialEdge data. Tenants include companies such as WeWork, Design Center Philadelphia, Kravet and Bright Light Design Center.

The East Market project also calls for the redevelopment of a historic office building into a boutique hotel, as well as a 19-story medical building for Thomas Jefferson University and Jefferson Health. The high-rise is slated to centralize several clinical services into a Specialty Care Pavilion.

Located in the central Market East neighborhood of Philadelphia, the development provides easy access to several SEPTA Regional Rail lines and multiple transportation options within the city. The Philadelphia International Airport is situated some 10 miles southwest. Several retail, employment, dining and entertainment options are available within a 1-mile radius.

Senior Managing Director Chad Orcutt and Associate Blaine Fleming led the JLL Capital Markets Debt Advisory team representing the borrower.

Last month, another joint venture secured $500 million for a massive Philadelphia project. Developed by Hilco Redevelopment and its partners, The Bellwether District is a 15 million-square-foot mixed-use industrial park in the southern part of the city. The campus is slated to include life science space, a research lab, as well as e-commerce and logistics space.

The post JV Secures $260M Refi for Philadelphia Mixed-Use Project appeared first on Commercial Property Executive.

York Business Center. Image courtesy of Endurance Real Estate Group

A joint venture between ASB Real Estate Investments and Endurance Real Estate Group has purchased a 1.5 million-square-foot industrial center in York, Pa., marking the duo’s fourth investment together. Equity Industrial Partners pocketed $91 million for the three-building property.

ASB purchased York Business Center on behalf of its $7.4 billion core vehicle dubbed Allegiance Real Estate Fund. The seller acquired the 119-acre property back in 2008, according to CommercialEdge.

The buildings are near Interstate 83, adjacent to Route 30 and York Mall Shopping Center. The two largest structures have 787,600 and 686,000 square feet, along with 32-foot clear heights and an average ratio of one dock per 7,000 square feet. On-site parking is available for 1,600 cars and 400 trailers.

The facility is primarily occupied by Harley-Davidson, which conducts just-in-time manufacturing and pre-assembly operations at the site, due to its proximity to the motorcycle company’s York plant. Other tenants include LSC Communications and non-profit health-care delivery company WellSpan. The latter utilizes the property’s 53,670-square-foot office space for its mission critical operations center.

Investing in Pennsylvania

The deal is Endurance’s largest purchase to date, according to President Benjamin Cohen. The Pennsylvania-based group is currently constructing another logistics center in the Harrisburg area. Rising at 2070 N. Union St. in Middletown, Pa. on a 110-acre site, the 251,200-square-foot facility is slated for completion in spring 2022.

ASB’s U.S. industrial portfolio includes some 10 million square feet and is 99 percent leased. In September, the partnership sold a 430,373-square-foot industrial asset in Bensalem, Pa. to EQT Exeter, which picked up the property for $42 million. ASB and Endurance paid $23.7 million for the facility in late 2018.

The post ASB, Endurance Pay $91M for Pennsylvania Industrial Asset appeared first on Commercial Property Executive.

450 Winks Lane. Image courtesy of ASB Real Estate Investments and Endurance Real Estate Group

Global real estate operator EQT Exeter has acquired a 430,373-square-foot, multi-tenant industrial building in Bensalem, Pa., from joint venture partners ASB Real Estate Investments and Endurance Real Estate Group LLC for nearly $42 million. ASB Real Estate’s sale was made on behalf of its Meridian Real Estate Fund II.

READ ALSO: Why Industrial Space Demand Exceeds Expectations

Endurance, through an affiliate, acquired the property at 450 Winks Lane in Bucks County just north of Philadelphia in December 2018. The purchase price was $23.7 million, according to CommercialEdge data. The seller was Ivy Realty, which had paid $13 million for the property in 2017, according to Bucks County records.

Built in 1973, the property is located within the Expressway 95 Business Park and has access to major arteries including US Routes 1, 13, 130, the New Jersey Turnpike and the Pennsylvania Turnpike. The asset had renovations in 2018, including a new roof and upgrades to the building’s mezzanine and landscaping.

The warehouse/distribution facility features clearance heights ranging from 28 to 40 feet, LED and T-5 lighting, 38 dock-high loading doors and six drive-in doors. Tenants include National Refrigeration, Rolled Metal Products and Brenner Aero Structures, which had all renewed their leases shortly before the 2018 purchase.

Albert Corr, Endurance senior vice president, said in a prepared statement the diverse tenant roster made the property a desirable industrial opportunity. He also noted demand for infill industrial assets is a strong market driver in the suburban Philadelphia markets. Corr said the marketing process was highly competitive and many buyers were interested in the property.

Brodie Ruland, ASB managing director & co-head of acquisitions, said in prepared remarks the sale represented an excellent execution of the company’s value creation strategy. Ruland added the sale benefited from current high demand from institutional investors for industrial properties which is driving down cap rates, increasing valuations and escalating sale prices.

The CBRE National Partners team of Brad Ruppel, Mike Hines, Brian Fiumara and Lauren Dawicki represented the seller and procured the buyer.

Earlier deals

In July 2020, a joint venture between Endurance Real Estate Group and Thackeray Partners sold a four-property industrial portfolio totaling 240,358 square feet in Fairless Hills, Pa., to Exeter Property Group for $18 million.

In April, Exeter Property Group was acquired by EQT AB for $1.87 billion from global private equity firm TA Associates. The firm is now known as EQT Exeter. An active investor in the U.S. industrial market, one of its most recent acquisitions was the purchase in June of a 52-acre site in Mount Comfort Commercial Park near Indianapolis from Becknell Industrial.

EQT Exeter, one of the largest industrial property owners in the Indianapolis market, planned to immediately begin construction of a 955,687-square-foot speculative warehouse on the site. Also in June, EQT Exeter acquired a 241,676-square-foot, three-building office and industrial property in the Price Road Corridor in Chandler, Ariz., from Digital Realty Trust.

The post EQT Exeter Buys Industrial Asset for $42M appeared first on Commercial Property Executive.

123 S. Broad St. Image courtesy of PCCP LLC

PCCP LLC has provided a $80 million senior note for the refinancing of 123 S. Broad St., a 705,500-square-foot office building in Philadelphia, also known as the Wells Fargo Building. The ownership of the 30-story landmark tower includes SSH Real Estate, Quilvest Capital Partners and Young Capital.

According to John Randall, partner with PCCP, the loan will refinance the existing debt and will also serve a $4.1 million capital improvement plan. The renovation efforts will boost the property’s amenity package, with the addition of a rooftop deck, fitness center and shared conference space. JLL’s Ryan Ade and Jim Cadranell arranged the transaction.

Once the tallest building in the city and the ninth-largest in the world, 123 South Broad St. was constructed in 1928 in Center City, three blocks south of City Hall.

SSH acquired the historic tower in a portfolio transaction which included the neighboring property known as The Witherspoon Building at 1319 Walnut St., in a two-part deal in 2008 and 2018. SSH separated the two structures, moved its headquarters to 123 S. Broad St., while redeveloping The Witherspoon Building into a 186-unit apartment hotel.

Post-pandemic confidence

The Wells Fargo building currently offers a three-story lobby, ground-floor bike room and concierge service. Since the onset of the global health crisis, the property gained nine new tenants occupying a combined 60,000 square feet. At the time of the refinancing, the building’s roster included 92 tenants.

Despite the office market’s pandemic-induced uncertainties, PCCP has been vigorously recapitalizing properties across the country, including five loans within New York City. Earlier in August, the finance and investment management firm provided a $148 million loan for the recently renovated, 387,300-square-foot 1410 Broadway tower in Midtown Manhattan.

The post Landmark Philly Tower Lands $80M Refi appeared first on Commercial Property Executive.

3701 Market St. Image courtesy of CBRE

On the heels of a $155 million life science / R&D acquisition in the Bay Area, San Francisco-based private equity firm GI Partners picked up another property, this time in Philadelphia’s University City neighborhood. The 140,913-square-foot life science building traded for $79 million, according to the Philadelphia Business Journal.

READ ALSO: Life Sciences Buildings to Launch $400M Navy Yard Phase I

University City Science Center, the former owner of the eight-story building at 3701 Market St., put the asset up for sale in early 2021. Most of the property is currently occupied by Penn Medicine and Drexel University.

Situated just outside central Philadelphia and next to the University of Pennsylvania, 3701 Market St. came online in 2000. Over the last four years, the seller invested nearly $3 million in property renovations. Capital improvements included the addition of a new roof, as well as upgrades to the building-automation and HVAC systems.

CBRE Capital Markets’ Institutional Properties team in charge of marketing the asset on behalf of the seller included Robert Fahey, Jerry Kranzel, Bruer Kershner, Erin Hannan and Jack Corcoran. Additionally, the brokerage’s debt & structure finance team, led by Steven Doherty and Nick Harris, secured mortgage financing for the buyer.

A thriving sector

The sale of 3701 Market St. at roughly $567 per square foot emphasizes the life science sector’s current status as one of the hottest markets since the pandemic hit in early 2020. By comparison, the average sale price for office space this year in Philadelphia hit $171 per square foot as of the end of May, a recent CommercialEdge report shows.

According to Fahey, executive vice president at CBRE, Philadelphia is regarded as the fourth-largest research cluster in the country. The metro has been attracting out-of-town investors, as seven of the 10 largest office transactions over the past five years drew on outside capital.

Two life science buildings totaling at least 200,000 square feet will be among the first to rise within the $2.5 billion Philadelphia Navy Yard development’s first phase. Master developer PIDC will partner with Ensemble Real Estate Investments and Mosaic Development Partners to transform 109 acres at Navy Yard. The $400 million first stage will also include 3 million square feet of life science manufacturing, R&D, office, hospitality and retail space.

The post GI Partners Buys Life Science Asset for $79M appeared first on Commercial Property Executive.

Innovation 411. Image courtesy of The Discovery Labs

The University of Pennsylvania’s Gene Therapy Program has signed a lease for more than 150,000 square feet of lab space at Discovery Labs’ Innovation 411 campus in King of Prussia, Pa.

READ ALSO: The Life Science Industry’s Transformation

The program will use the space “for a portion of its expanding research operations focused on the development of genetic medicines for rare and orphan diseases, as well as acquired and pandemic infectious diseases, such as COVID-19,” the lessor said in a prepared statement.

The multi-year lease makes Penn’s Gene Therapy Program an anchor tenant for Discovery Labs’ growing 7 million-square-foot life sciences cluster in King of Prussia. The deal encompasses space in two buildings in the 1 million-square-foot Innovation 411 campus on Swedeland Road.  

Penn Medicine joins GSK, WuXi Biologics and the Center for Breakthrough Medicines at the biotech campus.

Innovation 411 is adjacent to Discovery Labs’ 700,000-square-foot Innovation Renaissance campus, which is anchored by such leading health-care entities as Thomas Jefferson University Health, Children’s Hospital of Philadelphia, Amerisource Bergen/World Courier and Tosoh Biosciences.

Discovery Labs was represented in the transaction by its own Joe Corcoran, senior vice president, and Julian O’Neill, director of marketing. The University of Pennsylvania was represented by Colliers Executive VP Joe Fetterman.

Campuses and clusters

Discovery Labs in King of Prussia originated when MLP Ventures, formerly O’Neill Properties, in 2018 acquired two sizable assets: GlaxoSmithKline’s 1 million-square-foot former Upper Merion West campus for about $52 million and the nearby 640,000-square-foot Liberty Property Trust office portfolio, for nearly $80 million. The latter was rebranded as Innovation Renaissance.

More recently, Discovery Labs purchased the 660,000-square-foot former Philadelphia Inquirer printing plant, almost adjacent to the other two campuses. Renamed as Innovation 800, it will be renovated into life sciences research and manufacturing space.

In a recent report, Converging for Cures, Colliers identified The Discovery Labs as being located within one of eight significant life science neighborhoods in metro Philadelphia.

The Upper Merion submarket, Colliers notes, has been a pharma hub since the 1950s. In addition to Discovery Labs’ trio of properties there, Brandywine Realty Trust is looking into developing a lab building about 2 miles away, at 650 Park Ave., King of Prussia, according to Colliers.

The post Penn Inks Lease at Philadelphia-Area Life Science Hub appeared first on Commercial Property Executive.

Two Penn Center Plaza. Image via Google Street View

Crown Two Penn Center Associates, a Pennsylvania limited partnership that is 22.16 percent owned by Optibase Ltd., has refinanced Two Penn Center Plaza, a 20-story office building in Philadelphia. The new loan has an outstanding principal balance of $67.9 million.

The existing 10-year loan on the Center City property located at 1500 John F. Kennedy Blvd. had an outstanding principal balance of approximately $44 million. According to CommercialEdge, the previous loan, originated in May 2011 by UBS, was approximately $52.2 million.

As a result of the refinancing, Crown Two Penn Center Associates generated excess cash. Optibase said its share was approximately $5 million. Crown Two Penn Center Associates will make a distribution of $2 million out of the $5 million in the upcoming weeks.

READ ALSO: Lending Across CRE Sectors: Q&A

The limited partnership acquired the office property in October 2012 for $66 million, according to CommercialEdge data. The 502,531-square-foot multi-tenant building has 478,801 square feet of leasable space, with most of the tenants being office users. The property also features 23,730 square feet of retail, including 18,530 square feet of underground retail.

Built in 1958 and completely renovated in 1988, the transit-oriented property is located within walking distance of four train stations.

Headquartered in Herzliya, Israel, Optibase invests in the fixed-income real estate field. The firm currently holds interests in properties in Switzerland, Texas and three U.S. cities: Philadelphia, Chicago and Miami.

Philadelphia Development

Also in Philadelphia, construction of 3025 John F. Kennedy Blvd.—a 28-story, 570,000-square-foot mixed-use tower at the $3.5 billion, 14-acre Schuylkill Yards innovation neighborhood—was scheduled to begin this spring.

In February, Brandywine Realty Trust, the master developer of the massive University City project in partnership with Drexel University, secured a joint venture partner for the first vertical development within the mega project. The tower will have a mix of life science, office and retail space along with 326 ultra-luxury rental units and is slated for completion in 2023.

The post Philadelphia Office Tower Gets $68M Refinancing appeared first on Commercial Property Executive.

951 Willowbrook Road. Image courtesy of CenterPoint Properties

CenterPoint Properties has purchased a newly constructed 1 million-square-foot industrial facility in Northampton, Pa., marking its first acquisition in the Lehigh Valley market.

CommercialEdge data lists the last owner as Rockefeller Group, which developed the property with $64.2 million in construction financing provided by TD Bank.

READ ALSO: Al. Neyer Raises $110M With First Fund

JLL Senior Managing Directors John Plower and John Huguenard of JLL worked on behalf of the seller.

Located at 951 Willowbrook Road, the project occupies 70 acres adjacent to an 800,000-square-foot FedEx distribution center and less than 3 miles from Lehigh Valley International Airport. The building features 40-foot clear-height, an ESFR sprinkler system and 149 dock doors, as well as 166 trailer stalls and 759 car stalls. According to a Newmark industry report, the facility is fully leased to Geodis, an international shipment company.   

In mid-February, CenterPoint Properties expanded its Houston-area portfolio with the acquisition of a distribution facility in Pasadena, Texas. The property was developed on a 31-acre site with rail service provided by Union Pacific, BNSF and Kansas City Southern through the Port Terminal Railroad Association.

The post CenterPoint Properties Buys 1 MSF Lehigh Valley Asset appeared first on Commercial Property Executive.

Building 624. Image courtesy of Groundswell

Two life sciences buildings will be among the first properties built at the Philadelphia Navy Yard by Ensemble Real Estate Investments and Mosaic Development Partners, in partnership with PIDC, Philadelphia’s public-private economic development corporation, as the team launches the initial phase of a $2.5 billion development plan.

READ ALSO: The Life Science Industry’s Transformation

The announcement comes as PIDC, the master developer of the Philadelphia Navy Yard, confirms the execution of an agreement announced in July that gives the Ensemble/Mosaic team the exclusive development rights for 109 acres at the Navy Yard. PIDC selected the team after a year-long competitive selection process. PIDC retained JLL in early 2019 as an advisor in the development partner search. JLL supported PIDC throughout the RFQ and RFP processes and assisted PIDC with development agreement negotiations.

The $400 million first phase will also include significant residential and hospitality initiatives after the completion of the two life sciences buildings. Ensemble/Mosaic plan to bring 3,000 residential units and nearly 3 million square feet of life science manufacturing, R&D, office, hotels, makerspace and retail space when complete.

Navy Yard, Phase 1. Image courtesy of Ensemble Real Estate Investments, Mosaic Development Partners and PIDC

Kate McNamara, PIDC senior vice president, said in a prepared statement the expansion of the life sciences hub at the former military base will bring high-quality jobs and support the growth of the campus that is already home to 15,000 employees. When the first two buildings are completed, the Navy Yard will have more than 1 million square feet of life sciences space.

Development details

Ensemble/Mosaic will construct a four-story, 100,000-square-foot speculative laboratory and office building at 1201 Normandy Place, with anticipated delivery by late 2022. Designed by DIGSAU, an award-winning architecture firm, in collaboration with CRB, a global architecture and engineering firm, the project is expected to achieve LEED Gold certification. The building will have 30,000-square-foot floorplates with 16-foot floor-to-floor heights that will provide lab and clinical manufacturing-ready environments. Spaces ranging from 5,000 to 10,000 square feet will be available.

Mark Seltzer, an Ensemble senior vice president for development, cited the location of the Navy Yard and its close proximity to University City, where many cell and gene therapy research companies are located, as well as the Philadelphia International Airport. He said the Navy Yard life science properties will allow companies to incubate, commercialize and manufacture within 15 minutes of each other and an international airport.

The second building, 333 Rouse Boulevard, is expected to be a 120,000-square-foot facility that could include space for office, labs, manufacturing and warehousing. The manufacturing area will support interior ceiling heights up to 16 feet. The building is designed by DIGSAU and IPS-Integrated Projects Services LLC, a design firm specializing in life science properties.

Joining Seltzer as leaders of the development team are Brian Cohen, an Ensemble senior vice president and regional director, and Greg Reaves and Leslie Smallwood-Lewis, Mosaic co-founders & owners.

In January, PIDC and Ensemble/Mosaic began seeking proposals for large-scale master planning at the Navy Yard. An announcement about a firm to lead the 2021 Navy Yard Master Plan Update will be made in the coming weeks.

The post Life Sciences Buildings to Launch $400M Navy Yard Phase I appeared first on Commercial Property Executive.

3 Crescent Drive

Norvin Healthcare Properties has obtained a $39 million loan to finance its Jefferson Health medical office building located near the Philadelphia Navy Yard Corporate Center. CIT Group Inc. arranged the financing through its Healthcare Finance division. CommercialEdge data shows Norvin acquired the fully leased Class A property in 2019 for $62.3 million from Liberty Property Trust.

The four-story, 106,400-square-foot medical office building occupies a 5.5-acre site at 3 Crescent Drive within the Philadelphia Navy Yard. Anchoring the corner of Crescent Drive and Diagonal Boulevard, the facility was the first building in the overall master plan to occupy that main axis of the 1,200-acre development.

The building is flanked by One Crescent Drive and Five Crescent Drive, two other office developments part of LPT’s former Navy Yard portfolio. An affiliate of Korea Investment Management Co. purchased Five Crescent Drive in 2018 for $130.5 million, while Ensemble acquired One Crescent Drive in 2019 for $26.6 million, according to CommercialEdge.

Three Crescent Drive

Completed in 2009, the LEED Gold-certified facility was designed by Erdy McHenry Architecture and features above standard ceiling heights and ground-floor retail. The property also includes Navy Yard’s first structured parking deck, with a capacity of 595 spaces.

Jefferson Health is the medical building’s anchor tenant, while the balance of the property is occupied by Jefferson Health Surgical Center, a joint venture between Jefferson Health, The Rothman Institute and ValueHealth. The on-site specialty offices include allergology, urology and family medicine, among others.

The property is some 4 miles south of downtown Philadelphia across from Crescent Park, just south of Interstate 95. Philadelphia International Airport is 5 miles west.

State of the MOBs

As a resilient asset class poised for quick recovery, medical office buildings remained relatively unaffected by the pandemic. The sales volume totaled $3.8 billion in the fourth quarter of 2020, according to a CBRE report, a mere 3 percent drop year-over-year.

While 18 transactions closed in the Northeast region, only one of them involved Philadelphia assets, CommercialEdge data shows. In December, the Hampshire Cos. acquired a two-building portfolio totaling 268,060 square feet from BG Capital.

The post Norvin Healthcare Lands $39M Loan for Philadelphia MOB appeared first on Commercial Property Executive.

AmerisourceBergen’s future headquarters at SORA West in Conshohocken, Pa. Image courtesy of Keystone Property Group

PRP LLC has closed on a preferred equity investment in the new trophy office tower at Keystone Property Group’s $325 million SORA West mixed-use development in Conshohocken, Pa. The approximately 430,000-square-foot building will be the new headquarters of pharmaceutical products company AmerisourceBergen. Neither PRP nor Keystone commented on the financial terms of the transaction. However, according to the Philadelphia Business Journal, PRP purchased an 89 percent equity stake in the property at a cost of just under $340 million.

Keystone broke ground on the office building that will anchor the transit-oriented SORA West development in April 2019 and topped out on the 12-story tower in February 2020. The Gensler-designed structure will feature a rooftop terrace, fitness center, dining services, training center and community plaza, as well as two lower levels of parking.

READ ALSO: What’s Next for the Office Market

“PRP’s main investment objective is to acquire long-term leased, single-tenant office and industrial properties nationwide. SORA West is a brand-new, state-of-the-art headquarters campus with a long-term full-building lease in place with AmerisourceBergen,” Joseph Neckles, managing director of net lease acquisitions with PRP LLC, told Commercial Property Executive.

“AmerisourceBergen is the largest company in the State of Pennsylvania by revenue and one of the ten largest public companies in the U.S. They are a high investment grade credit tenant with a long and stable operating history. This transaction is a perfect fit for PRP’s investment objectives,” Neckles added. Eastdil Secured served in an advisory capacity to PRP in the transaction with Keystone.

Upon completion of the LEED Silver-certified office digs at SORA West, AmerisourceBergen will relocate from its current 200,000-square-foot home base in Chesterbrook and an additional 100,000-square-foot space at another location in Conshohocken. Intech Construction is the general contractor on the project and is on track to deliver the project later in 2021.

Finger on the pulse

Approximately 1,500 AmerisourceBergen employees will call the office building at SORA West home. And ultimately, the workers will be at the heart of a mixed-use destination that will also encompass the 127-key Tapestry Collection by Hilton hotel called Hotel West + Main, an amphitheater, a public plaza, a 1,500-space public-private parking facility and a repurposed historic firehouse with dining on the first floor and a gastropub on the second.  

READ ALSO: Attracting Office Tenants in a Post-Pandemic Environment

“As the vaccine works its way through the population, we feel confident that employees will be called back to the office. AmerisourceBergen associates will return to a brand-new, world-class workplace within a dynamic live/work/play environment,” Neckles said. “The historic firehouse on-site will become a dining and entertainment venue; the new hotel will be a luxury experience with a high-end rooftop cocktail lounge (…) It will be an exciting workplace and lifestyle for employees to return to.”

Just as PRP saw the value in a certain office project in Conshohocken, the company homed in on the advantage of a multifamily project in suburban Washington, D.C. In January 2021, PRP closed the non-recourse construction loan for the conversion of the office property at 4900 Seminary Road in Alexandria, Va., to a 213-unit luxury apartment community. The property, located across from a transit center, sits roughly 5 miles from Amazon’s HQ2 office campus.

The post PRP Invests in Office Component at $325M Philadelphia-Area Development appeared first on Commercial Property Executive.

200 Rittenhouse Circle. Image courtesy of Cushman & Wakefield

Camber Real Estate Partners, in partnership with AIG, has purchased a 1.2 million-square-foot, 25-building light industrial portfolio across Southern New Jersey and Bucks County, Penn., from Whitesell Co., according to public records. The buyers received a $69.5 million acquisition loan from Natixis, marking Camber’s second collaboration with the French corporate and investment bank.

CBRE National Partners closed the sale on behalf of the seller, while Cushman & Wakefield acted as exclusive advisor for the buyers in the placing of the floating-rate financing.

Located near interstates 95 and 295, the mix of distribution facilities and light industrial properties is more than 96.8 percent leased to a diverse tenant roster with a weighed average tenure of more than 10 years. Records indicate some of the properties involved in the transaction include:

• the 156,120-square-foot 200 Rittenhouse Circle in Bristol, Pa.,
• the 66,000-square-foot 501 Sharptown Road in Swedesboro, N.J.,
• the 188,533-square-foot 2115 High Hill Road in Bridgeport, N.J., and
• the 57,680-square-foot  2079 Center Square Road, also in Bridgeport.

Investing in the COVID-19 era

The CBRE team facilitating the disposition included Michael Hines, Brian Fiumara, Brad Ruppel and Liam Fahey. John Alascio, Sridhar Vankayala, Chuck Kohaut, TJ Sullivan and Meredith Donovan made up the Cushman & Wakefield Equity, Debt & Structured Finance team representing the borrower.

“The acquisition adds to the already robust industrial portfolio that Camber and AIG have built over the last decade. They continue to buy well-located assets in the path of growth across the Northeast,” Alascio, executive managing director at Cushman & Wakefield, told Commercial Property Executive.

In the midst of last year’s e-commerce-driven boom, AIG traded one its Class A New Jersey office assets in a $140 million August deal. The multinational finance and insurance corporation, represented by Cushman & Wakefield, sold the nearly 470,700-square-foot property in Woodbridge Township, N.J. to Opal Holdings.

Industrial market health

According to the latest national industrial report from CommercialEdge, U.S. rents averaged $6.44 per square foot in January, a 5.1 percent increase year-over-year, while vacancy was 6 percent. Within the Philadelphia market, rents were lower at $6 per square foot, with vacancy slightly elevated at 6.7 percent.

New Jersey rents in January were nearly a dollar higher than the U.S. average, clocking in at $7.34. The state’s 3.9 percent vacancy rate is well below the national average and the third lowest in the markets analyzed within the report. Although New Jersey has a more dated industrial stock compared to many emerging markets, demand for newer assets has driven Class A rents significantly higher than the market average. Southern New Jersey vacancy rates in the last quarter of 2020 averaged 2.8 percent, according to JLL.

As for supply, Philadelphia’s planned and under construction stock represented 7.5 percent of the market’s overall stock, nearly 2 percent higher than the country’s 5.4 percent. In New Jersey on the other hand, the figure was 3.6 percent, which, coupled with the asset class’ low vacancy and high desirability, could signal a demand for fresh supply.

Dermody Properties is one of the investors currently betting on the Southern New Jersey industrial market. The company is developing a three-building, 1.2 million-square-foot logistics park in Woolwich Township. Construction is set to start this spring.

The post Camber, AIG Buy Greater Philadelphia Industrial Portfolio appeared first on Commercial Property Executive.

Image by falco via Pixabay.com

Dermody Properties plans to start construction this spring on LogistiCenter at Woolwich, a three-building, 1.2-million-square-foot logistics park in Woolwich Township, Gloucester County, N.J.

READ ALSO: Top 10 Markets for Industrial Transactions in 2020

The three Class A buildings will be of 552,585; 336,700; and 262,200 square feet and will feature 36- to 40-foot clear heights, build-to-suit office space, ESFR fire protection systems, 50 to 110 dock-high doors, drive-in doors, as well as ample trailer and car parking.

The location is at the Woolwich Township intersection of Route 322 and Locke Avenue. In conjunction with the 154-acre park’s development, Dermody plans to make significant improvements to the intersection.

The site is less than 2 miles from I-295 and less than 3 miles from I-95. This easy highway access reportedly will allow customers to reach 33 percent of the U.S. population in a single day’s drive.

Dermody did not reply to Commercial Property Executive’s request for additional information.

CBRE has been selected as the park’s exclusive agent, with brokers Mindy Lissner, Drew Green, Paul Touhey, Dan McGovern and David Gheriani handling leasing activities.

The virtues of South Jersey

Southern New Jersey is an attractive alternative for companies that want Class A warehouse space, but find that it’s too rare or too costly in Central and Northern New Jersey, Gene Preston, East Region partner at Dermody Properties, said in a prepared statement.

The Gloucester County warehouse/distribution space market has a 3.8 percent total vacancy and 4.9 percent total availability, on an inventory of about 26.1 million square feet, according to a fourth-quarter report from JLL.

About 960,000 square feet of space was delivered in the submarket in 2020, all of it in the fourth quarter, and nearly 1.3 million is currently under construction, JLL reported.

Last May, when Dermody delivered its LogistiCenter at Speedway, in North Las Vegas, the 251,800-square-foot property was already 30 percent leased.

On the other side of the ledger, in June, Dermody and partner PCCP sold LogistiCenter at 33, in Easton, Pa., to Black Creek Group. The 475,800-square-foot property went for $62.5 million.

The post Dermody to Develop 1 MSF Logistics Park in Metro Philadelphia appeared first on Commercial Property Executive.