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ISSUE HIGHLIGHTS Volume 24 Issue 16 Aug. 31 - Sept. 13, 2012 Cushman & Wakefield arranges $71 million sale
330,589 s/f trophy office tower developed by The Evans Company Clarion Partners’ Metro Park VI achieves LEED Platinum Certification
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lexandria, VA — Clarion Partners’ Metro Park VI, a newly deliv-
screened to help reduce solar radiation transmitted into the space. The building’s orientation, shape, and performance charac- teristics combine to reduce the building’s energy consumption by more than 35 percent com- pared with that of a similar, con- ventional building. The building also reduces water use dramati- cally – 50% in outdoor landscap- ing using and 30% indoors. “We are proud to receive USG- BC’s highest level of recognition for our commitment to sustain- ability and high-performance design and construction,” said Marc DeLuca, managing direc- tor, Clarion Partners. “Metro Park VI demonstrates that developers do not have to make radical changes to conventional modern office building design, nor do they have to spend lav- ishly, in order to achieve sub- stantial reductions in building energy and water use, along with greatly improved indoor air qual- ity that can optimize tenants’ productivity and health.” n
ered 330,589 s/f trophy office tower has been awarded LEED Platinum certification by the US Green Building Council. The LEED (Leadership in En- ergy and Environmental Design) Core and Shell 2.0 Platinum level recognizes the building’s substantial reductions in build- ing energy and water use, along with its exemplary level of in- door air quality. Developed by The Evans Com- pany for New York-based Clar- ion Partners and designed by KlingStubbins, Metro Park VI is 60% pre-leased; Booz Allen & Hamilton has signed a ten-year, $40 million lease for 88,000 s/f. It is the final building within the 1.2 million s/f Metro Park office park, favored by Federal government contractors due to its proximity to Metrorail, the VRE commuter train, Fort Bel- voir, and the newly relocated National Geospatial-Intelligence Agency.
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Metro Park VI in Alexandria, VA
Keystone Chapter of ABC honors High Construction
Metro Park campus offers ten- ants an award-winning LEED Platinum conference center and full-service fitness center, along with the NAIOP award-winning Walker’s Grille, featuring fresh, locally sourced menu items in a congenial environment. “Metro Park VI represents an intelligent evolution of the suburban office building type,” said architect Glenn Crawford of KlingStubbins. “Rather than relying on a single, dramatic sus- tainable feature, or on elements that would prove challenging to
future tenants, the design opti- mizes conventional ingredients into a result that exceeds con- ventional expectations.” Central to the building’s per- formance is its form and mass- ing. After testing various mod- els, the design team selected a lozenge-shaped tower with “pinched” east and west ends to reduce heat gain at those expo- sures. Glass curtain wall, which covers most of the building’s exterior, consists of double-pane Low-E glazing filled withArgon. Portions of the glazing are silk
10A
Shopping Centers featuring PA/NJ/DE ICSC Show
SSH Real Estate arranges partnership transfer on two properties for $46 million
Section B
Philadelphia, PA—SSH Real Estate has represented 1201 Chestnut Street Partners LP in the transfer of certain partnership interests in The Commonwealth Apartment Building, a 98-unit, redevel-
CREATE celebrates 15 Year anniversary 16-17B
Directory
Auction News/Directory................ 6-7A Owners, Developers & Managers 9-29A Green Buildings......................... 16-24A People on the Move....................... 30A Calendar of Events. ........................ 32A Shopping Centers................... Section B
opment of an historic office tower at 1201 Chestnut St. in Philadelphia. INVESCO Real Estate of Dallas, Texas made the invest- ment on behalf of an unnamed client. “The Commonwealth rep- resents a fantastic value-add story for both SSH and for Philadelphia,” said Daniel Mayock, director of Invest- ment Services for SSH. “The 1201 Chestnut Street in Philadelphia
100 Concord in Chester Township
ownership group was com- prised of three different oper- ating partners, 806 Capital, Silverang Hallowell, and SSH Real Estate. Together they transformed an obsolete, class C office building into a new apartment project. In an unrelated transaction, SSH facilitated a joint venture partnership capitalization of the Chester Creek Business- Center in Chester Twp. Ches-
ter Creek Business Center is comprised of three existing office/flex/warehouse buildings totaling 178,960 s/f and a pad site supporting a fourth build- ing of 72,000 s/f. Mayock and Adam Gillespie of SSH Real Estate were the agents on both transactions. The collective debt and eq- uity capitalization of both transactions totals over $46 million. n
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Inside Cover A — August 31 - September 13, 2012 — Mid Atlantic Real Estate Journal
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Mid Atlantic Real Estate Journal — August 31 - September 13, 2012 — A
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A — August 31 - September 13, 2012 — Mid Atlantic Real Estate Journal
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Aldo Design Group......................................................... 10A Alfred Auctions. ............................................................... 7A ALT Realty..................................................................... 18B Auction Directory............................................................. 7A B.R. Kreider & Son, Inc................................................. 21B Bill Board Directory. ................................................. IBC-A BL Companies....................................................... 10A, 32B Bohler Engineering........................................................ 14B Borrus Associates........................................................... 25B Brahney.............................................................................12 Business Card Directory. .............................................. 31A Capitol Aerials............................................................... 19A CBC Bennett Williams.................................................... 3B Chartwell Group............................................................. 7A Clarion Partners..........................................................BC-A Cooper Roofing............................................................... 11A CREATE ........................................................................ 17B Crystal............................................................................ 20A Cushman & Wakefield..................................................... 5A D.F. Pray. ................................................................... IBC-B Earth Engineering Incorporated..................................... 8B Entech. ........................................................................... 16A Fameco Real Estate....................................................... 10B FOWLER........................................................................ 25A Franchise World............................................................. 21B GA Keen Realty Advisors................................................ 3A Gerard Construction Corp........................................16-17B Gilbeaux Associates, PC................................................ 19A Haftek CWS................................................................... 14A Hutchinson Mechanical Svcs........................................ 22A Hylant Environmental Risk Management................... 32B IREM.............................................................................. 27A Katz Properties................................................................ 7B Kay Realty Services LLC. ............................................. 32B KW Commercial- The James Balliet Comm’l. Grp........ 2B Landcore Engineering Consultants, P.C.. ...................... 4B Lippincott Jacobs........................................................... 12B LMS Commercial Real Estate....................................... 19B M. Miller & Son. .............................................................. 3A Marcus & Millichap Taylor Zang.................................... 4B McMahon Transportation Engineers & Planners.......... 6B Meyer Consulting Engineers Corporation.................... 16B NAI Keystone Commercial & Industrial, LLC............. 27B NAI Summit..................................................................... 3A NJ Paving....................................................................... 15A NJ SmartStart Buildings.............................................. 18A NorthMarq Capital.......................................................... 4A Omdex Incorporated Consulting Engineers................. 16B Penncap Properties......................................................BC-B Poskanzer Skott Architects........................................... 13A RCX. ............................................................................... 21A RD Management LLC. .............................................22-23B Real Connect.................................................................... 9B ROCK Commercial Real Estate...................................... 6B SHAH Electric & Builder.............................................. 12A Silbert Realty................................................................. 13B Target Building Construction....................................... 11B Thesing Companies. ...................................................... 27B TRG. ................................................................................. 9B Vanasse Hangen Brustlin, Inc...................................... 32B Vantage Landscaping............................................10A, 14A Whitestone Associates, Inc............................................ 14B WP Realty. ....................................................................... 5B MAREJ A dvertisers D irectory To advertise, call 1-800-584-1062
Mid Atlantic R eal E state J ournal Publisher ............................................................................Linda Christman Co-Publisher .........................................................................Joe Christman Section Publisher ..............................................................Michael Campisi Section Publisher ................................................................Elaine Fanning Senior Editor/Graphic Artist ................................................ Karen Vachon Production Assistant ......................................................... Rachel Rugman Office Manager ....................................................................Joanne Gavaza Editorial Consultant .............................................................. Ben Summers Contributing Columnist .......................................................... Eugene Diaz Mid Atlantic R eal E state J ournal ~ Published Semi-Monthly P.O. Box 26 Accord, MA 02018 (Mail) 312 Market Street, Rockland, MA 02370 (Overnight) Periodicals postage paid at Rockland, Massachusetts and additional mailing offices Postmaster send address change to: Mid Atlantic Real Estate Journal, P.O. Box 26, Accord, MA 02018 USPS #22-358 | Vol. 24 Issue 16 Subscription rates: $99 - one year, $198 - two years, $4 - single copy REPORT AN ERROR IMMEDIATELY MARE Journal will not be responsible for more than one incorrect insertion Toll-Free: (800) 584-1062 | MA: (781) 871-5298 | Fax: (781) 871-5299 www.marejournal.com The views expressed by contributing columnists are not necessarily representative of the Mid Atlantic Real Estate Journal
Mid Atlantic Real Estate Journal
By Eugene Diaz Investment Sales: Recession’s After-effects Are Still In Play
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ncertain capital flow for “in-between” deals, increased foreign in-
vestment money for big city properties, an increase in con- struction money, and signs of hope from the economy – those are some of the current trends in an investment sales market still impacted by the after-ef- fects of an economic recession that “officially” ended nearly four years ago. Those after-effects are play- ing out in an investment sales market that has not completely stabilized. After a surge in sales in 2011, for example, the market slowed a bit in the first quarter of 2012, and not necessarily because there is not a sufficient supply of capi- tal. Rather, there has been a lack of quality supply to fuel transactions. The analogy is that cur- rent supply is “two ends of the barbell,” with nothing in the middle. There is either a strong desire for high-qual- ity core, long-term stabilized assets on one end of the bar- bell, or absolute rock bottom pricing providing the basis for opportunistic, value-add transactions on the other. For now, there is very little capital in the market to appropriately price deals in the middle of the barbell – deals that may be value-add in nature, but involve an investor or opera- tor who has to do something with the asset to generate a significant yield. Put another way, those “in between” transactions current- ly providing little investment impetus are those that cannot guarantee long-term cash flow, or do not guarantee or have a significant opportunistic upside – mid and upper 20 percent returns or higher. For those transactions, investors have not put the risk on trade in terms of having confidence in the economy to carry those investments with any sort of underwrite-able certainty. That said, and despite the ebbs and flows of the market- place, the recent performance of the economy has indeed provided some hope and a sense of positive expectation. There has been moderate job hiring and employment gains,
although that has not neces- sarily shown up in all of the statistics just yet. But we are seeing a clear in- crease in activity, particularly among the small to mid-sized companies. One indication comes from the Bankers As- sociation, which reports that those small to mid-sized com- panies are now beginning to access capital and that lenders are beginning to let capital flow to those non publicly traded enterprises. That is indeed a change, because while many of those companies have continued to have very good balance sheets, it has been the large, multi- national public companies that for the past years have had sole, exclusive access to the capital markets. One example of the increase in activity among banks that lend to those kind of groups is Sun Bank, based in Vine- land, N.J. Sun, which has its Northern New Jersey business office in our company’s office park, has been there for just three years and already has doubled their occupancy on the expectation that their middle market lending business is increasing dramatically. In terms of other current investment market trends, for- eign investor money has been extremely active – but only in the gateway cities. As far as the region’s suburbanmarkets, there is some interest in credit- based, long-term leasebacks – they’ll play in that arena. But in general, the suburban markets are not attracting foreign capital. Over and above the foreign money, the majority of capital currently in the market ap- pears to be the commingled funds and institutional pen- sion fund advisors. They are
generally, of course, the same buyers that have always been here and after experiencing a long hiatus are coming back to market. More funds have been raised, they’ve been sit- ting on cash, the mandates are starting to come in, and they are becoming more active. We are, in fact, receiving calls from them and seeing more interest and competition when a quality transaction becomes available. We are also seeing some construction money returning to the market, especially for multi-family product. As has been reported, there has been a significant increase in multi- family construction projects, driven in part by the REITs, as well as by private institutional capital. The industry just can’t seem to build enough apart- ments to meet the current de- mand in a housing market that has seen a surging in rentals at the expense of home buying. But overall, returning to the earlier analogy, there is still too little available product for investment money to be chas- ing at the ends of the “barbell.” That overall trend, by the way, is impacting pricing positively. When a very attractive, high- quality, stabilized transaction does become available in this market, it will indeed be sold at aggressive pricing. For the rest of the year and into 2013, the investment sales market forecast remains mixed. Trends in the overall economy will set the tone, and if pricing does remain aggres- sive, more opportunities will arise for the flow of money that has been sitting on the sidelines post-recession. Eugene Diaz is principal partner of Prism Capital Partners, LLC in Bloom- field, NJ. n
Mid Atlantic Real Estate Journal — August 31 - September 13, 2012 — 3A
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M id A tlAntic R eAl e stAte J ouRnAl Of Philadelphia-area Apartments Cushman & Wakefield arranges $1 million sale
They wrote the policy.
We make sure they write the check.
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ENSALEM, PA—Cush- man & Wakefield has orchestrated the $71
Marx along with senior managing director Joe Mes- sina and assistant director Chris Koeck, represented McManimon, Scotland & Baumann in the transaction. The landlord, Mack-Cali, was represented in-house by Rich Travaglini and Diane Chayes. n “With that influx, pricing has become increasingly aggres- sive, and class B communities with a vintage similar to Vil- lage Square have been trading near a six percent yield,” he said. n only inmetro Philadelphia, but also the larger Washington, D.C. to NewYork corridor,” Me- rin said. “But metro Philadel- phia in particular has emerged as a market for multi-family investors. In the early 2000’s, only a handful of communities were being sold in this market per year. Since 2010, with an influx of new buyers and capital targeting Philadelphia assets, we’re seeing a more heated and liquid investment sales market with a dozen or more communities being sold per year.”
ROSELAND, NJ — Studley represented McManimon, Scotland & Baumann, LLC in a long-term, 17,931 s/f lease at 75 Livingston Ave. McManimon, Scotland & Baumann took part of the sec- ond floor in the class A office building. Improved workplace strategies and efficiencies “The market for well-located, high-quality multi-family as- sets in metro Philadelphia has been robust with activity, and we have seen growing demand million sale of Village Square Apartments, a 694-unit com- plex in Bensalem. Karen Iman, Brian Whitmer, Andrew Me- rin, Marybeth Farris and Nick Karali of the firm’s Capital Markets Group (CMG) repre- sented the agent for the seller, Korman Residential, and pro- cured the buyer, Paradise Property, LLC. Village Square Apartments consists of 436 one-bedroom and 258 two-bedroom units in 56 two-story, brick-clad build- ings.
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both from local owners and developers, as well as investors from outside of the region”, said Iman. “The fact that this offering attracted more than 120 ex- pressions of interest is a clear sign of the demand that’s out there for apartment assets, not
COMING SOON FALL PREVIEW We are inviting a select group of top executives to write an expert article about the current state of their respective marketplace and where they see it progressing in 2012. These experts will enlighten our readers on their industry and give a general overview of the marketplace in the field they represent
Studley’s Marx, Messina & Koeck broker 1,931 s/f lease reduced the firm’s office foot- print by almost 25% from its previous location.
“Favorable market condi- tions, along with a ‘right sizing’ of office space, allowed the firm to achieve substantial savings in overall occupancy costs,” said Studley senior managing director Christopher Marx.
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Deadline for Editorial: September 14, 2012 Publication Date: September 28, 2012
The Mid Atlantic Real Estate Journal welcomes all editorial dealing with the commercial/industrial real estate industry. Contact Linda Christman Today! 800-584 -1062 x203 [email protected] wwwmarejournal.com Editorial Requirements Include: Half page ad with 550 word article and a headshot of the author
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4A — August 31 - September 13, 2012 — Mid Atlantic Real Estate Journal
www.marejournal.com M id A tlAntic R eAl e stAte J ouRnAl During the first half of 2012 CMC arranges $88.9 million in real estate loans L IVINGSTON, NJ — Mark Scott’s Commer- cial Mortgage Capital
DEBT | EQUITY INVESTMENT SALES Capital Markets
Scott, founder and principal of CMC. “These loans speak to our ability to facilitate the proper financing structure for a range of borrowers in an expedited manner. We understand the competitive marketplace and offer quick turnaround as well as responsive and professional guidance throughout the entire loan process.” The six most recent transac- tions that closed were: • Edgewater Harbor – Build- ing F – Multi-family, Retail – Edgewater, NJ Mark Scott’s Commercial Mortgage Capital arranged a $14 million construction
loan. The loan will finance the construction of Building F at Edgewater Harbor, a 24-acre, luxury mixed-use project on New Jersey’s Gold Coast. • Andrew’s Corner – Multi- family – Lakewood, NJ Mark Scott’s Commercial Mortgage Capital arranged a $14.2 million permanent loan for a partnership consisting of New Jersey developers who own thousands of multi-family units across the state as well as several million square feet of industrial and office space in New Jersey and Pennsylvania. The loan is forAndrew’s Corner, a 148-unit apartment commu- nity located at 1 Lisa Robyn Circle in Lakewood, NJ. • Dartmouth Village Apart- ments – Multi-family – Parsip- pany, NJ Mark Scott’s Commercial Mortgage Capital arranged a $9.5million self-liquidating first mortgage loan for Dartmouth Village, LLC’s Dartmouth Vil- lageApartments in Parsippany, NJ. The Dartmouth Village garden apartment complex consists of 222 units housed in eight buildings. • River Bend at Wappingers Falls (Phase 2) – Multi-family – Wappingers, NY Mark Scott’s Commercial Mortgage Capital arranged an $8 million LIBOR-based con- struction loan for Riverbend at Wappingers, LLC, which was formed specifically to build, own and manage the luxury apartment complex, River Bend Wappingers Falls. The fully- leased property consists of 10 apartment buildings contain- ing 124. • Columbia Court – Multi- family – Springfield, NJ Mark Scott’s Commercial Mortgage Capital arranged a $7.8 million permanent first mortgage loan for Columbia Court. The financing is for lux- ury apartment complex Colum- bia Court, which is located on 50 Maple Ave. in the suburban community of Springfield, NJ, part of Union County. The prop- erty consists of two adjoining three-story buildings contain- ing 74 units – three studios and three-bedroom apartments, 17 one-bedroom units and 55 two- bedroom spaces. • Multi-family Property – Camden County, NJ Mark Scott’s Commercial Mortgage Capital arranged a $5.5 million permanent first mortgage loan for a 148-unit apartment, n
(CMC) has closed $88.9 million worth of loans dur- ing the first six months of 2012. “ We a r e p l e a s ed t o announce our
Innovative solutions and deep expertise for all of your commercial real estate financing needs.
Mark Scott
latest Mark Scott’s Commercial Mortgage Capital transactions, which support our strategy of arranging financing for multi- family real estate projects in the Tri-State region,” said
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