R EAL E STATE J OURNAL the most comprehensive source for commercial real estate news
ISSUE HIGHLIGHTS Volume 26 Issue 15 August 15 - 28, 2014
Miller, McFadden & Stefanski of CBRE’s multifamily team represent seller CBRE Philadelphia brokers sale of Hidden Forest apartments for $21m+ F
AIRLESS HILLS, PA — CBRE, Inc ., has brokered the sale of Hidden Forest Apartments in Fairless Hills, The seller, TGM Associates, was repre- sented by Robert Miller , John McFadden , and Matt Stefanski of CBRE’s Multi- family Division inWayne, PA. The property sold to a private investor from New York for $21,300,000, or $89,496 per unit. “This property attracted strong interest from New York investors because of its ideal location near I-95 and the Pennsylvania Turnpike in Bucks County. Investors saw strong rental upside, as the property enjoyed 98% oc- cupancy,” said Miller, execu- tive vice president with CBRE Philadelphia’s Multifamily Team. “Fully renovated more than ten years ago, the prop- erty was much younger than its 1967 construction date.” n
Multifamily Financing Spotlight 6-14A
Gebroe-Hammer Associates arranges $26m+ sale
FC-B
Hidden Forest Apartments
Barr and Bennett of Lee & Associates close mid-year with $20 million Kohl’s deal
PA’s Elite Companies
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and purchase of a 88,408 s / f Koh l ’ s , l o c a t e d a t 501 Technol- ogy Center in Stoughton. W i t h 1 1 y e a r s r e - maining on the double- n e t ( N N ) l e a s e , t h e property sold at a 6.22% cap rate. “ T h i s i s a rare ne t leased asset
STOUGHTON, MA — Ryan Barr and Ryan Ben- nett , principals of Lee & Associates – North San Diego County and founders of Barr & Bennett Net Leased Investment Group , hit the mid-year mark in stride as the pair negotiated an all cash, $20 million sale
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Ryan Barr
Company Name: NAI Summit
Company Name: BartonPartners
ArchitectsPlanners, Inc. Type of Firm & Overview of Company: BartonPartners is a multi-disciplinary
Typeof Firm&Overviewof Company: Full ServiceCommercial/IndustrialRealEstate
irm; Founded in1982,NAISummitwasbuilt on theprincipals f combining thebest realestatepracticeswith in-depthmarket nowledge to comprehensively meet client business goals. We onsistentlymaintain thehighestvolumeof commercial transac- ionsbyutilizinganextensivenetworkof professionalaffiliations. ore thananyother realestate firm,NAISummitknowsEastern ennsylvania, its properties, people and market. issionStatement: NAISummit,upon its inception,established he philosophy of being a relationship-oriented firm. This ap- roach differs significantly from the transaction-oriented phi- osophy of most real estate firms in the industry. NAI Summit’s irst and foremost responsibility is to the clients we represent n the many facets of commercial real estate. This philosophy equiresNAISummit toperform in theprofessionaland respon- ible fashion clients expect and know they will experience only ith NAI Summit. ervices and or Products offered: Sales & Leasing, Investment ales,Property&AssetManagement,CorporateServices,Facili- ies Management, Building Services hat is your Vision and Strategy in the next year: NAI Summit as establisheda strongplatformwhichwill enableus to recruit dditional agents and further p netrate our market. hat projects are you currently involved in currently: Butz orporation, PPL Plaza (leasing and management), Integrated ealth Campus (leasing and management) and an investment ale of 180,920 sf at 3700 Glover Road eadquarters: Allentown, PA dditional locations: Hazleton, PA o. of employees: 50 employees
design firm comprisedof architects,urbandesigners (siteplan- ners), landscapearchitectsand interiordesigners.Our integrated designapproachmaximizes thequalityandefficiencyof ourproj- ects. With 40+ professionals located in suburban Philadelphia, BartonPartnershasofferedprofessionaldesign services forover twenty years throughout the eastern half of the United States. The disposition of our clients is indicative of our success, with over 80% of our projects coming through repeat work.
Directory DelMarVa.................................................................3-4A Financial Digest......................................................5-16A Pennsylvania.................................................... Section C New Jersey....................................................... Section B Central New Jersey.................................................5-12B Mission Statement: The hallmark of BartonPartners’ practice is an integrated, multi-disciplinary design approach. Our archi- tects,urbandesigners, landscapearchitectsand interiordesign- ers collaborate throughout the design process. This enables us to maximize the quality and efficiency of our projects, which are delivered on time and on budget. Our mission is to create sustainable, dynamic and marketable places that achieve our client’s goals. Headquarters: Norristown, PA No. of employees: 40+ employees ServicesandorProductsoffered: UrbanDesign/LandPlanning, Architecture, Landscape Architecture, Interior Design What projects are you currently involved in currently: Some of BartonPartners current projects include: SOKO Lofts, SterlingApartments,ParkTownePlaceandOxfordMills inPhila- delphia,PA;MadisonNewBritain inChalfont,PA;134Plymouth Road in Plymouth Meeting, PA; One Ardmore Place in Ardmore, PA; Gregory School Apartments in Long Branch, NJ; Windsor Station in Windsor, CT; Flanagan’s Landing in Glastonbury, CT; Mallory Ridge in Bloomfield, CT; and Pearl Street Properties in Hartford, CT.
41 Martha Drive rendering
Ryan Bennett
that was for sale in the North East,” said Barr. “This was an ideal transaction. The buyer, who was secured from the Barr & Bennett Net Leased Investment Group’s proprietary database, paid in all cash and closed escrow in 35 days.” According to Bennett, the buyer, RK Funding, LLC ,
501 Technology Center
plans a long term hold on the property. “It was a perfect fit for them” Bennett said, adding that location and the credit of the tenant were big factors.” Barr said “ the sel ler , StoughtonMarketplace DST,
sold the property because of optimal market conditions for an asset like this with term remaining.” With this transaction, Barr and Bennett have negotiated more than $62 million in clos- ings since January 2014. n
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J R HUEY AUCTIONEER TANGLEWOOD GOLF COURSE 318 TANGLEWOOD RD, PULASKI, PA 16143 SATURDAY, SEPTEMBER 6TH, 2014 @ 10:00 AM
LOCATED: Approx 12 miles West Of New Castle, Pa Or 7 miles East of Youngstown, Ohio on RT 422, Turn East On Rt 208 1 6/10 mile to Tanglewood Rd to Auction. Watch For Huey Auction Signs
OPEN HOUSE AUGUST 17TH 11:00 AM TO 4:00 PM REAL ESTATE * GOLF CARTS * MAINTENANCE EQUIPMENT TRUCKS CAMPER * SNACK BAR EQUIP * TOOLS & MORE
LOCATED ONLY 4 MILES FROM PROPOSED LAWRENCE DOWNS CASINO & RACE TRACK RESORT
REAL ESTATE SELLS FIRST @ 10:00 AM **** NO BUYERS FEE. REAL ESTATE CONSISTING OF 189 +/- ACRES SOLD IN 4 PARCELS. PULASKI TWP ** LAWRENCE COUNTY, PA PARCEL #1: SELLS ABSOLUTE TO HIGH BIDDER. NO MINIMUMS – NO RESERVES
Picturesque, 182 +/- Acre, Gently Rolling 18 hole Golf Course Family Established & Operated Since 1960!
Features include: Well-maintained Fairways & Greens, 6 ponds, 1 w/ fountain, Ample Paved Parking & Paved & Graveled Cart ways. Highlights include: 32’ x 60’ Cart barn w/ blacktop floor, 2 over head doors &new Metal Roof in 2014; 26’ x 40’ Blacktop Cart Pavilion; 36’ x 66’ cemented pole bldg (new in 2014) w/indoor mulch bunk; 52’ x 60’ Cement block league room pavilion w/ 12’x 28’ porches on each end, 16’ x 42’porch on ft., new metal roof & siding in 2014. 40’ x 60’ cement canopy pad; 100’ x 28’ garage w/ cemented floors, heated workshop & 7 overhead doors; small bldg at #1 Tee; Pump house w/ 1995 Rain Bird Auto Computerized Sprinkler System w/ remote control, Flowtronex PSI 3 phase Pumping System (SN 8257-A)Supplied by 6 ponds (one w/ fountain) & 3 abundant water wells.
DON’T MISS this is a once in a lifetime opportunity to purchase this well-established business w/ excellent Road Frontage, Endless potential. All Bldgs & Grounds in well maintained Condition
AUCTIONEERS
JOE MCKNIGHT AU-001145-L PULASKI, PA (724) 854-0547
SUE ANN WEIDNER AU-001588-L SLIPPERY ROCK, PA (724) 794-4737
JOHN R. HUEY II AU-001588-L SLIPPERY ROCK, PA (724) 794-4737
Real Estate Journal — August 15 - 28, 2014 — 1A
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RETIREMENT AUCTION
PARCEL #3: SELLS ABSOLUTE TO HIGH BIDDER NO MINIMUMS* NO RESERVES *** SELLS W/ NO GAS OR OIL RIGHTS Consisting of 5.6 +/- Semi Wooded Acres on Corner Of RT 208 & Tanglewood Rd, includes well & Public Sewage.TERMS ON PARCEL #3: $5,000.00 down Day Of Auction (NON REFUNDABLE) Balance In 30 – 45 Days or upon delivery Of ClearDeed. Taxes On Parcel #3: $284.00 YR. Ref # 29-3704-0131 Beautiful Corner Lot Awaiting Your Dream Home! PARCEL #4: SELLS ABSOLUTE TO HIGH BIDDER NO MINIMUMS * NO RESERVES** SELLS W/ NO GAS OR OILRIGHTS. Consisting Of 1-Acre Level Bldg Lot w/ Frontage on Tanglewood & Deer Creek Rd. TERMS ON PARCEL #4: $1,000.00 Down Day Of Auction (NON REFUNDABLE) Balance in 30 to 45days or upon delivery Of Clear Deed. Taxes On Parcel #4: $13. Ref. # 29-3704-0124 Call Auctioneers For More Info Or Appt To View. Open House August 17th 11:00 AM to 4:00 PM ALL OF THE FOLLOWING SELLS ABSOLUTE TO HIGH BIDDER NO MINIMUMS * NO RESERVES (22) CLUB CAR GOLF CARTS: (15 gas; (7) Elec. W/ chargers & new batteries. MAINTENANCE EQUIP: (2) Cushman Turf-Trucksters w/ hyd dumpbeds; (2) Club Car Carryall Turf II maintenance Cart (1 manual, (1) hyddump bed); JD 350 BE Dozer w/6 way blade, winch, 4650 hrs (s#1344851); Ford 3400 diesel 8 sp, 3 pt, PS, Turf Tires showing 2352 hrs; Case DH-4 w/ hyd ripper; Case 3014 4 cyl gas Trencher w/ backhoe (1998 hrs); Ransoms 305 Fairway mower diesel w/ canopy 4 WD (s#94501500152); JD 2653 A diesel Fairway Mower; Toro 4 Matic GroundsMaster 455-D diesel Roughage Mower 10’ hyd fold PS, 4 WD;Toro Reel Master 6700D, 4 WD. Diesel Fairway Mower; JD 3235 4WD Diesel Fairway Mower –(runs but parts machine); Jacobsen TextronGreens King VI 1826G greens mower w/ extra reels (sold separately);Toro 16 hp & 14 hp greens mowers PS; Softec 52000 Trap Rake w/2140 hrs; Hustler Super Z Zero Turn Mower w/ 60” deck; Toro Multipro 1100greens Sprayer w/ 150 gal tank & booms 1020 hrs w/ Raven Controller;Toro greens Slicer; Toro greens plug aireator; 12 Volt greens sweeper;hyd core picker; Toro Reel master 6 gang pull type gang mower; RyanWalk behind Sod Cutter; Lesco 8 hp power seeder; Turf Co Mete -R-Matic III top dresser; 3 pt pto power seeder; Lely pull type fert spreader; Jacobsen 3 pt pto blower; Toro pull type sweeper /vac w/ Kohler motor; 8’ hyd pull type aireator; Kohler 18 hp blower; Troybilt 7 hp rear tine tiller; Steiner MX
Be sure to make plans now to come visit us at the Open House August 17th 11:00 am to 4:00 pm PARCEL #1 SELLS ABSOLUTE TO HIGH BIDDER NO MINIMUMS * NO RESERVES W/ NO GAS OR OIL RIGHTS. TERMS ON PARCEL #1: $100,000. 00 Down (Non Refundable) day of Auction, Balance in 30 to 45 days or upon delivery of deed. (Guaranteed clear deed.) (NO BUYER FEE!) Taxes On Parcel #1: $21,999.41 YR.* Ref. # 29-3704 – 0125-0189B PARCEL #2: SELLS W/ OWNER CONFIRMATION Elegant Executive Style 2 Bedroom 2 Story Brick Home situated on a Professionally Landscaped .43 Acre Lot. A Grand Ft Entrance opens to the Formal Foyer leading to a large modern kitchen w/ island seating, custom solid cherry cabinetry, Jetta solid surface countertops, the tiled floor continues thru to the adjoining spacious first floor laundry. Also on1st floor: 20’ x 14’ Carpeted Formal Dining Room; 12’ x 12’bedroom; full bath; lg office w/ closets & storage, leading to 24’ x 36’ chalet style social/ family room currently used as a snack bar/ sales counter featuring Jetta Solid Surface Countertops w/ Knotty Pine Ceiling & Trim. Built in Show Cases. Also includes 2 additional rest rooms. Fire / Security alarm system & 10’ Covered Entrance Way. Climbing the beautiful staircase leading you to a 20’ x 32’ carpeted family room w/ custom Cherry built in entertainment center & bar. Family Room has ample storage & half Bath. Exquisite Second floor 19’ x 21’carpeted Master Suite w/ 12’ x 12’ Tiled Master bath w/ walk in shower, jetted tub, dual vanities, spacious walk in closet. French Doors Lead To The 40’ x 20’ Vinyl Deck Overlooking the Scenic golf course. Home also entertains a 30’ x 42 cemented basement w/bonus room & fireplace & ½ bath presents unlimited possibilities. 32’ x 35’ 3 Car Attached Garage w/ Door Openers – Loads Of Storage, Opens to 40’ x12’ Lower Vinyl Deck. Home Has Well Water – Conventional Septic; Electric heat & Central air; Fire / Security & intercom System. Beautiful Custom Oak Trim Through out. PLAN NOW TO COME TAKE A LOOK, EXCEPTIONALLY NICE HOME LOCATED IN A BEAUTIFUL SCENIC SETTING. TERMS ON PARCEL #2: $30,000.00 Down Day Of Auction (NON REFUNDABLE) Balance in 60 days or upondelivery of deed. (Guaranteed Clear Deed.) Taxes on Parcel #2:$3441.36. Ref # 29-3704-0126 PARCEL # 2 SELLS W/ OWNER CONFIRMATION SELLS W/ NO GAS OR OIL RIGHT
460 Rotary Mower & Other Steiner Attachments; 4 lawnroller; pull type & walk behind spreaders; Homelite 4” Trash Pump &More.
BE SURE TOP STOP BY & PICK UP AN AUCTION FLYER & MAPS IN AUCTION FLYER MAIL BOX AT SALE SITE. LOG ONTO AUCTIONZIP.COM TO VIEW PHOTOS & FULL LISTINGS USE AU ID # 1361 (HUEY AUCTIONEERS) OR (#11854 MCKNIGHT)
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MAREJ A dvertising D irectory Bayshore Recycling. ................................................11B Bennett Williams.......................................................3C Berkadia...................................................................11A Bohler Engineering & Consulting............................9C Bussel..................................................................... IC-B Commercial Mortgage Capital................................10A Cooper Horowitz......................................................16A Cushman & Wakefield. .............................................1B Deerwood..................................................................15A Earth Engineering......................................... 13B & 6C Eastern Union. ........................................................10B Gebroe-Hammer........................................................3B GREP........................................................................12C Griffin Land...............................................................8C Harvey Hanna. ..........................................................4A Hawley Realty. ........................................................11C Heller Industrial........................................................2B Hinerfeld....................................................................1C IBS............................................................................18A ICREW NJ...........................................................IBC-B inHabit.......................................................................9C IOREBA. ..................................................................16B J R Huey. ............................................................. IC-1A Kaplin Stewart. .........................................................2A Kearny Federal Savings..........................................13A Keast & Hood Co.. ...................................................19C Kislak.........................................................................7B KW Commercial, The James Balliet Group.............6C Landmark Commercial Realty. ................................2C LMS Commerical Real Estate. .................................8C Manko, Gold, Katcher, & Fox...................................2C Marcus & Millichap.................................................18A McMahon. ................................................................13C Mericle Commercial Real Estate Services.......... BC-C Meridian Capital Group............................................8B NAI Keystone......................................................... IC-C NAI Summit...............................................................8C Nave Newell.............................................................11C NorthMarq.................................................................9A PennCap Properties. .................................................8C Poskanzer Skott Architects.......................................4B Progress Capital........................................................8A Provident Bank..................................................... BC-A Real Property Capital................................................7A Reisa.........................................................................18A Rittenhouse Capital Advisors...................................6A RT Environmental Services....................................12C SEBCO.......................................................................4B Sheldon Gross Realty................................................3B Sorce Companies. ......................................................9B Target Building Construction.................................13C The Blau & Berg Company.......................................6B Traffic Planning & Design. .......................................4C Tranzon......................................................................3C Tri-State...............................................................IBC-A Warfel Construction..................................................9C WCRE.........................................................................2B
Mid Atlantic R eal E state J ournal Publisher.............................................................................. Linda Christman Publisher................................................................................. Joe Christman Publisher/Senior Account Executive...................................... Elaine Fanning Section Publisher....................................................................... Steve Kelley Senior Editor/Graphic Artist.....................................................Karen Vachon Production Assistant.......................................................................Julie King Office Manager..................................................................... Joanne Gavaza Guest Columnist................................................ Bill Gladstone, CCIM, SIOR Mid Atlantic R eal E state J ournal — Published Semi-Monthly Periodicals postage paid at Rockland, Massachusetts and additional mailing offices Postmaster send address change to: Mid Atlantic Real Estate Journal, 312 Market St. Rockland, MA 02370 USPS #22-358 | Vol. 26 Issue 15 Subscription rates: $99 - one year, $198 - two years, $4 - single copy
Mid Atlantic Real Estate Journal
Are you in your future? Bill Gladstone
I n today’s world of discov- ery and specialization, generalists are falling by the wayside in all industries. Consider Virginia Rometty, CEO of IBM, and Lowell Mc- Adam, CEO of Verizon. You may think both are generalists in that they look at the broad picture. But are they really specialists with the singular focus – the success of their companies in the business world? If we scale this down to common, everyday occur- rences, it may be easier to de- fine the specialist you need to be in order to succeed in your chosen field. For an attorney, it would be hard to focus equally on criminal litigation and in- tellectual property law or practice bankruptcy law and insurance regulatory law si- multaneously. A corporate tax accountant may not be equally as good at forensic ac- counting. Instead of excelling at one thing, the professional becomes mediocre at both.
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The views expressed by contributing columnists are not necessarily representative of the Mid Atlantic Real Estate Journal
Certainly the same applies in real estate. It’s hard to be both a landlord’s seller’s as well as a tenant’s buyer’s broker and do both well. It is hard for a real estate agent to do the leasing of big box warehouses and investment sales equally as well. Consider choosing one or the other. The day of trying to be all things to all people just doesn’t work. The expectations of your clients are set too high and their ability to raise those expectations unannounced can easily happen. It can be difficult to find your niche as you consider your work life. But the sooner you
continued on page 18A discover your niche, the sooner you will define the added value you bring to your clients. In the short term, you might lose some money and clients as your focus narrows, but in the long term, you will experience great success as your service levels start to exceed your cli- ent’s expectations and as word of mouth referrals and recom- mendations (in addition to your own personal marketing) ensure that your work future is very well protected. And once you find that niche, stay in it. Do not venture out on tangential business because
Committed to Your Goals
The guy on the left spent lots of money to hire a bunch of experts whose ideas never took flight. The guys on the right hardly took notice – they were too busy flying their idea. If they were law firms, which one of these guys would you rather work with? Contact: Jeffrey L. Silberman • jsilberman@kaplaw.com 910 Harvest Drive, Blue Bell, PA 19422-0765 • 610.941.2518 • www.kaplaw.com Visit our Construction Blog: www.pennsylvaniaconstructionlawyer.com Other Offices: • Cherry Hill, NJ 856-675-1550 • Philadelphia, PA 215-567-3120 Kaplin Stewart A t t o r n e y s a t Law Total commitment works wonders. Talk to us first.
To advertise, call 1-800-584-1062
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139-unit apartment building to offer urban living near Bethesda Row and Metro Washington Property Company breaks ground for $60m development of Solaire Bethesda
M
Solaire Bethesda residents will be just 15 minutes from downtown Washington and Union Station. “Solaire Bethesda will set a new standard for modern urban living in Bethesda,” said Daryl South , senior vice president, WPC. “The property’s numerous ameni- ties and proximity to down- town Bethesda’s renowned restaurants and retailers will attract residents who desire convenience and quality of life in one of the most coveted residential communities in the region.” Amenities at Solaire Bethes- da will include a residents’ lounge with billiards, bar, fire- place, and games; a club room; cyber café, a state-of-the-art fitness center; and outdoor terraces. “When initially purchased out of foreclosure, our team immediately implemented a recapitalization program and a strategic marketing and leasing plan,” said FCP vice president of commercial asset management, Howard Jen- kins . “We are very pleased with Lexington Village’s tran- sition from a partially devel- oped property that included a stand-alone Kohl’s department store, to a vital retail center - incorporating Dick’s Sporting building at 11810 Grand Park Ave. in Phase 1 of Pike & Rose. Delivering in late 2014 and early 2015, the initial first phase of Pike & Rose also includes approximately 500 high-end residential apart- ments; entertainment such as iPic Theaters and AMP, and a performance venue “Federal Realty is proud to welcome Bank of America Mer- rill Lynch, a world leader in the affluent and growing area of St. Mary’s County.
WPC purchased the 25,000 s/f site at 7100 Wisconsin Ave. in July of 2011. The $60 million development is being financed with a $42 million construction loan from RBS Citizens Bank . Solaire Bethesda will be WPC’s third Solaire-branded luxury apartment community, following the 2012 opening of Solaire Silver Spring and the early 2014 opening of So- laire Wheaton. These distinct properties, totaling nearly 700 units, combine the finest ame- nities and unit finishes with close proximity to Metrorail’s Red Line. The Wheaton and Silver Spring developments provide the ultimate in conve- nient urban Metro-accessible living at rental rates substan- tially below those in Washing- ton, DC. n
O N T G O M E R Y C OUN T Y , MD — Bethesda, MD-
based Washington Prop- erty Company has broken ground for its latest and most upscale apartment complex on Metrorail’s Red Line in Montgomery County. Solaire Bethesda, scheduled to deliver in 2016, will offer 139 rental apartments with 6,400 s/f of ground-floor retail space and a two-level underground park- ing garage. Strategically located at the corner of Wisconsin andWood- mont Avenues on the site of the former Eastham’s Exxon Servicenter, Solaire Bethesda will be just 800 feet from the planned southern entrance to the Bethesda Metro station and Purple Line light rail sta- tion. Riding Metro’s Red Line, LEXINGTON PARK, MD — Federal Capital Part- ners® (FCP) and Westmo- reland Partners have an- nounced the sale for $24.1 million of Lexington Village, a 160,000 s/f, 96% leased re- tail center at the intersection of Maryland Rte. 235 and Buck Hewitt Rd. in Lexington Park. Acquired in November 2010, FCP and Westmoreland Partners completed the devel- opment of the property and transformed the center into a thriving and successfully tenanted retail destination in ROCKVILLE, MD — Fed- eral Realty Investment Trust announced Bank of America Merrill Lynch as the lead office tenant at Pike & Rose, the new transit-oriented, pedestrian-friendly, mixed- use neighborhood at the top of the White Flint District of North Bethesda. Bank of Amer- ica Merrill Lynch will occupy 40,000 s/f, half of the 80,000 s/f LEED certified, class “A” office
Solaire Bethesda rendering
FCP announces sale of Lexington village shopping center for $24.1m
NGKF completes 606,575 s/f lease renewal in DC
Goods as a second anchor, na- tional credit tenants along the front parcels, and an attractive mix of specialty store tenants.” FCP and Westmoreland Partners extend their appre- ciation to construction lender PNC , the retail sales team at CBRE , leasing brokers Ryan Wilner and Ryan Minnehan of KLNB , leasing consultant Art Carson , property man- ager Renaud Consulting , and to St. Mary’s County for its support in the activation and development of Lexington Village. n wealth management and fi- nancial services to Pike & Rose as our lead office tenant,” said Chris Weilminster , executive vice president - real estate and leasing at Federal Realty Invest- ment Trust. “The commitment of a first class company like Bank of America Merrill Lynch further underscores the strength of Pike & Rose as a leading des- tination in this affluent region of Montgomery County.”
for more than 30 years, and more recently has modernized the building, including energy efficiency upgrades.” Hoffman Tower II is part of Hoffman Town Center, an ur- ban mixed-use development in central Alexandria, developed by The Hoffman Co. Hoffman Town Center represents the potential for more than five million s/f of office, retail and residential space on 54 acres. This latest transaction comes after USAA Real Es- tate Co. purchased the 2.03- acre development site for the new headquarters of the National Science Foundation (NSF), which signed a 704,571 s/f pre-construction lease last summer. Owen represented The Hoffman Co. in the land sale. n
ALEXANDRIA, VA — On behalf of the U.S. Department of Defense, the U.S. General Services Administration (GSA) has signed a lease renewal for 606,575 s/f at Hoffman Tower II in Alexandria, VA’s urban center. Washington, DC based Brendan Owen , chairman- Asset Services group , and principal Scott Johnston of Newmark Grubb Knight Frank (NGKF) represented owner, The Hoffman Co. The tenant was represented by CBRE . “This is the largest lease in the Washington, DC region in 2014, and is one of the top five in the region in the last five years,” said Owen, who represents the Hoffman family. “The Department of Defense has occupied the site
Federal Realty Investment Trust announces lead office tenant for Pike & Rose
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M id A tlantic F inancial D igest F eaturing M ultifamily F inancing Transaction originated by Cassidy and Banks of Marcus & Millichap Greystone provides $29m bridge loan for student housing in College Park, MD
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and is in close proximity to Washington, DC and Balti- more, MD. The transaction was origi- nated by Jared Cassidy , Associate Director, Marcus & Millichap Capital Cor p. and Payton Banks , associ- ate vice president, Marcus & Millichap . “Student Housing is ob- viously a sector where it’s important to understand the unique nature of the tenancy in order to provide the optimal loan. Greystone has that capability and we were grateful for the opportu- nity to bring our expertise to bear,” said Marty Lanigan , head of Greystone’s Portfolio Lending Group. n
OLLEGE PARK, MD — Greystone , a national provider of
HILLCREST HEIGHTS, MD —Retail industry veteran Carl Verstandig , CEO and president of America’s Re- alty , purchased the Iverson Mall in Hillcrest Heights last week. The property sold for $27 million, or $43 p/s/f. Marc Tropp of Eastern Union ’s Maryland office ar- ranged the 4.4% seven-year acquisition loan with a re- gional balance sheet lender. Eastern Union also introduced another repeat client to the deal, facilitating a partnership which contributed the $9 mil- lion equity component on top of the loan amount. Tropp said the plan is to redevelop the property, which is garnering interest from na- tional tenants, creating mas- sive upside potential. “Carl buys an average of 18-22 shopping centers an- nually at this point, he has a great relationship with many national retailers, and his leasing experience was criti- cal to the success of this deal,” Tropp said. “The property sits between three metro stops, and it is only a matter of time before the market pushes closer to the site.” Verstandig will invest $4 million into upgrading the The bridge financing terms for The Enclave at 8700 include a 24-month floating rate loan with two 6-month extensions, and an interest- only period for the first 18 months. The Enclave at 8700 is a mixed-use student hous- ing property with parking garage and first-level retail. multifamily and healthcare mortgage loans, announced it provided a $29,275,000 bridge loan on a student housing property in College Park. The transaction was closed by Andrew Ellis , a senior mortgage originator at the firm.
building also boasts a 24- hour complimentary shuttle bus, study lounge, electronic key access, fitness center and The Enclave at 8700
With 94 total furnished 2-, 3-, and 4-bedroom suites each containing private kitchens, bedrooms and baths, the
Wi-Fi for 369 student resi- dents. The Enclave at 8700 is located within a mile of the University of Maryland,
Eastern Union Funding negotiates $21.5 million for DC-suburb shopping mall trade
Cronheim Mortgage secures $16m for two retail properties
Waterbury Crossing
1996 and 1997, respectively. The second $8,000,000 fi- nancing was arranged for a 126,800 s/f, two-building retail center, located in Pittsfield, MA. The asset was constructed in 1975 and is currently occu- pied by eight retail tenants in- cluding TJ Maxx, Petco, Home Goods, Sally Beauty Supply, and Planet Fitness, among others. The majority of the center was previously occupied by a Kmart who vacated the center in 1997. The Kmart space has since has since been subdivided to accommodate the current roster of tenants. The sponsor, Phoenix Merrill Road, LLC, has owned the subject since 2004. n
WATERBURY, CT/PITTS- FIELD, MA — Dev Morris , Allison Moravec , and An- drew Stewart , arranged a total of $16,000,000 for two retail properties, located in Waterbury, CT and Pittsfield, MA. The financings were both structured on a 10/30 basis, and were arranged for affiliates of Phoenix Realty Management . The first financing, totaling $8,000,000, was arranged for Phoenix Waterbury LLC, and secures Waterbury Crossing, a 69,400 s/f, 100% occupied retail center. Both Sports Au- thority and Petsmart are long- time tenants of the property, having occupied space since
Iverson Mall
Iverson Mall, with plans to improve a portion of the build- ing—a section used for office space that is currently 25% occupied. Additionally, the new management will redo the parking deck and exte- rior lighting as an additional safety measure. “Everyone has this idea that indoor shopping malls are going blank, but in many markets, like DC, that just doesn’t hold true,” Verstandig said. “We’re getting a lot of notice from big box anchors, and tenancy for a few of them is one of many exciting pos-
sibilities for the space.” Iverson is anchored by Bur- lington Coat Factory and Forman Mills, a regional dis- count-design retailer. Other shops include Foot Locker, Kay Jewelers, Bank of Amer- ica, AT&T, Payless Shoes, and GNC. With this transaction, Ver- standig owns 239 shopping centers in 35 states. Tropp is also arranging financing for Verstandig’s purchase of a $125 million portfolio span- ning five states, a deal which is scheduled to close in two weeks. n
6A — August 15 - 28, 2014 — M id A tlantic
Real Estate Journal
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M ultifamily F inancing
By George Johnson, Rittenhouse Capital Advisors Multifamily finance – The playing field is full again
A
s we move towards 2015, the multifamily financing landscape
swing and life companies are in the market selectively. So, indeed the playing the field is full again. How will the apartment finance mar- ket continue to evolve and what will we see in 2015 and beyond? Presently, competi- tion is heated amongst bank balance sheet lenders who are “buying” multifamily business to fatten their loan portfolios with aggressive 5 and 7-year debt, with flexible prepayment structures and made on a non- recourse basis. CMBS is back, as well as the return of interest only and
mezzanine debt in the capital stack. The product is slowly adapting and has made some
spreads down making CMBS a more compelling interest rate play.
sleeper. Notoriously selective, there are life company lenders in the market funding long- term, fixed-rate, non-recourse multifamily debt at 75% le- verage, in core and second- ary, tertiary markets as well. For those with a multifamily development project nearing completion or a stabilized building that is held up from refinancing by another 6-12 months of yield maintenance or defeasance, a long-term rate lock could be a great solution to taking interest rate risk off the table. It is one of best features offered by a handful of life company players today. Given the full recovery stage of the current multifamily markets in this region, the dearth of available stabilized assets has spurred signifi- cant redevelopment and new construction. Banks seem to be maintaining reasonable discipline on leverage with the norm being 70% LTC. Market wide, lenders are watching the supply-demand fundamentals closely. I wouldn’t be surprised to see the construction loan spigot turned off or down sig- nificantly in 2015. There is a consensus that we are in a rising rate envi- ronment and borrowers are looking to fix debt for the long term. The housing market will be a factor again in a few years and will surely impact rent growth. The most prudent lenders factor this, as well as other market influences, into their analysis and stress test underwriting. I feel strongly that we will see consolidation in the banking industry, as we’ve seen in prior cycles, as well as in the CMBS industry. There are simply too many banks out there and undoubt- edly too many CMBS lenders. For now, and moving into 2015, there are plenty of op- tions for most any multifam- ily project that is well located and with good sponsorship. It is and should continue to be a “borrowers market” for some time, particularly in the ma- jor metros of the Mid-Atlantic region with solid infill markets and high barriers to entry. George Johnson is the president and CEO of RCA. He has been in the commer- cial real estate financing industry for over 30 years. Throughout his career, he has been directly respon- sible for loan production approaching $1B. n
is as interest- ing as ever. The four pri- mary players are agencies, banks, CMBS lenders & life c ompan i es . A s o f 2 Q 2014, agen-
“For now, and moving into 2015, there are plenty of options for most any multifamily project that is well located and with good sponsorship.”
tangible adjustments. Lenders are now holding the “B” pieces and retaining servicing. The next run will be driven after the current lenders consoli- date, the stock market levels off and the “buy side” of the paper, in search of yield, drives
Agencies are still active and hungry with some great features however, there still seems to be reticence to the agency process and general concern over their tighter un- derwriting approach. Life companies are the
George Johnson
cies are still hungry for deals despite the mandated volume reduction, bank balance sheet lenders have re-entered the fray, CMBS 2.0x is back in full
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Real Estate Journal — August 15 - 28, 2014 — 7A
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M ultifamily F inancing
By R. Brenner Green, Real Property Capital, Inc. “Millennial,” the bubble buzzword?
M y titlemight be a little harsh, but it is time for the “anti-millen-
an increase of roughly 9% over the prior 20 year period. Conceded that these factors do seem to point to increased demand for rental apartments as opposed to home ownership in the short term, and that’s great for everyone, particularly multifamily developers. But that doesn’t mean that every project works because the devel- oper uses the word “millennial” in their pitch. If I hear onemore developer tell a crowd of people that his or her building has high speed internet becausemillenni- als demand it (the rest of us are still on dial-up I guess) or that
they can build 400 units at a horribly congested intersection and actually improve traffic flow because “millennials don’t have cars” I may not be able to con- tain my urge to laugh out loud at the absurdity of the notion. Here is Philadelphia, the revival of the urban core began when the oldest millennials were learning how to use the original iMac 15 plus years ago. The city has moved from a 5 o’clock ghost town to nearly a 24 hour city and millions of s/f of old office and industrial space was converted to apartments. To be fair, walking the streets
in the evening can make any- one old enough to have kids at home feel a little old. But…(and here is the point), the underly- ing forces in Philadelphia and other major cities are strongly engrained and more powerful than the millennials and their population boom. Anyone who envisions a utopic downtown where all of these apartment rentingmillennials growup and decide to eschew that house in the ‘burbs to send their kids to inner city public schools and move from a two bedroom to a three bedroom rental to live there in perpetuity has another
thing coming. “Urban flight” is still alive and well but is moti- vated by high taxes and poor schools rather than racial issues as it was 50 or 60 years ago. So next time you look at a multi- family project as a developer, investor or lender, consider the basics like location and cost and try to set aside the starry eyed notion that it’s custom tailored for the next greatest generation thereby automatically ensuring instant success. R. BrennerGreen is a 15 year veteran in commercial real estate finance and president of Real PropertyCapital, Inc. n
nial article. To be clear, I am not anti- millennial in anywaywhat- soever and I sincerely hope it’s the genera- tion that cures canc e r and
R. Brenner Green
achieves world peace. However I am against the notion that this generation is going to single handedly effect change in the way our society works and lives and utilizes multifamily real estate. I guess I have been to one too many conferences and/ or networking events related to commercial real estate lately where that is all anyone is talk- ing about, so I decided to look a little deeper into this argument and in broad strokes here is what I find to be the reality. 1. Much of the “change” the millennials are credited with ushering in has been occurring since most of them were in dia- pers. Baby boomers like Steve Jobs and Bill Gates created the computer revolution, we Gen X’ers are the ones who dropped out of corporate America to start our own businesses, move back into city centers and chose to get married and have kids later than our parents. The millen- nials haven’t yet accomplished much other than creating a web page that makes it easy to keep track of the lives of your “friends” (the definition of which now includes people you don’t actually know). 2. Presently Millennials have limited power to impact the broader economy due to some macro trends; themushrooming amount of student debt they are under and the lingering effects of the great recession that has acutely affected them. Since the leading edge of the millennial generation began graduating college in 2005, the amount of student loans outstanding has roughly tripledwith the average debt per capita now exceeding $30,000. And the most recent data available shows an unem- ployment rate for those between the ages of 18-29 that is around 50% higher than the overall unemployment rate. 3. The biggest accomplish- ment of millennials is, if nothing else, the fact that there are a lot of them. Births in the period of 1982 to 2002 (roughly how mil- lennials are defined, represent
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M ultifamily F inancing A 17-unit set of property located at 34-38 41st St. in Astoria
NorthMarq Capital arranges $2.85m refinance of 41st Street Apartments in Astoria, New York A STORIA , NY — Charles Cotsalas , senior director of
“StanCorp was able to get their hands around a few mishaps during the Great Recession unlike many other lenders,” said Cotsalas. “This is an extremely well located property, borrower construct- ed in the heat of Astoria, Queens.” n OCEAN TWP., NJ —State and local government officials gathered in the Township of Ocean yesterday with repre- sentatives from Ingerman , a leading developer, manager and builder of multi-family apartment communities, to break ground on The Willows at Waretown, a new communi- ty of 76 affordable apartments for seniors. The groundbreaking – at- tended by Township of Ocean Mayor Dennis Tredy; Deputy Mayor Christina Wetter; De- partment of Community Af- fairs Commissioner Richard Constable, III; New Jersey Housing and Mortgage Fi- nance Agency Executive Direc- tor Anthony Marchetta and Ingerman Development Prin- cipal Lara Schwager – was a culmination of a four-year ef- fort among the township , the state and Ingerman to help re- vitalize the town’s center with new affordable and convenient housing for seniors, including many who were displaced by Hurricane Sandy. Ingerman was awarded $9 million in Community Development Block Grant funding and $500,000 in tax credits to build The Willows at Waretown Town Center, a mixed-use plaza already comprising a Shop-Rite, a Dunkin’ Donuts, numerous local restaurants and shops, and a bus stop. “We have a vision for Ware- town Town Center, and our community has a critical need for this development.” Tredy said. “Many of our senior resi- dents lost their homes during Hurricane Sandy and need rental housing options that are within walking distance to local amenities. We look forward to our continued col- laboration with Ingerman as we move to the next phase of this project.” The community is expected to be ready for move-ins com- mencing in summer 2015. n Ingerman awarded $9m for senior housing community
NorthMarq Capital ’s New York metro based office se- cured the $2.85 million re- finance of the 41st Street Apartments, a 17-unit set of property located at 34-38 41st St. in Astoria. The transaction was s structured with a 10- year term and 25-year amor- tization schedule. NorthMarq arranged financing for the bor- rower, StanCorp Mortgage Investors, LLC through its correspondent relationship with a life company.
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