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Krame Development to develop 27 retail spaces in seven buildings The Provident Bank closes $55m loan for the development of a 244,450 s/f SC C LARK, NJ — The Provident Bank , a leader in commercial
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real estate lending state- wide, has closed a $55 mil- lion loan for the development of a new, 244,450 s/f shop- ping center in Clark. Krame Development will develop 27 retail spaces housed in seven buildings on the 28- acre parcel of land located on the former US Gypsum pa- per plant site. Construction is expected to be completed in late spring 2015 with a proposed Grand Opening on or about August 1, 2015. Executed leases lined up for 100% of the center include anchor tenants of Whole Foods and Home Goods. Other prominent tenants in the project include L.A. Fit- ness, Michael's, Petco, Ulta, Modell's and Party City. Provident and M&T Bank provided the construction financing with Provident as administrative agent.
Clark Commons Rendering
tailers that will complement each other and appeal to a broad section of the local population. Furthermore, we designed the project to make it pedestrian friendly and a true community shopping experience." As a major provider of com- mercial real estate loans in New Jersey, The Provident Bank specializes in financ-
ing retail, office, warehouse, apartment and mixed-use properties. In addition, Prov- ident also provides construc- tion financing for both new construction and building renovations for a variety of property types, including tract developments with multiple homes, condomini- um developments, retail cen- ters and office buildings. n ful physician who has ac- quired a substantial medical office portfolio over the past several years, purchased this asset from a local bank who had foreclosed on the property after the occupancy plummeted to 54 percent,” said Nalbandian. “Through hands on management and their extensive reach within the medical community, the sponsor created significant leasing momentum at the property. Within the first six months of ownership, the property was stabilized at over 90 percent occupancy. Sentinel understood the story and that this building is the top medical building in this sub-market, boasting an on-site surgery center. Consequently, Sentinel pro- vided a full 75 percent LTV, which represented a loan well above $200/s/f, enabling our client to cash out his eq- uity through this substantial value creation.” n
Gregory Lamb handled the transaction on behalf of Provident. "We have attracted the most desirable National and Regional tenants to this project due to its superb location and the quality of construction," said William Krame , president of Krame Development. "We went to great lengths to select re-
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Case Real Estate broadening its platform in 2015
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Northmarq Capital closes $16.5m refinance of New Jersey Health Care Center in Oradell, NJ
Skelly & Loy to design wastewater treatment plant
ORADELL, NJ — Greg- ory Nalbandian , manag- ing director of NorthMarq Capital ’s New Jersey office, arranged a $16.5 million re- financing for the New Jersey Health Care Center, a 75,000 s/f medical office building located at 680 Kinderkamack Rd. in Oradell, less than 2.5
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Directory
DelMarVa.................................................................5-6A Financial Digest......................................................7-17A New Jersey....................................................... Section B Northern New Jersey. ............................................5-12B Pennsylvania.................................................... Section C Central PA.............................................................. 5-10C
680 Kinderkamack Rd.
miles away from the Hack- ensack University Medical Center at Pascack Valley. The transaction was struc- tured with a 10-year term and 30-year amortization at a very aggressive inter- est rate and represents a
full cash-out refinance less than a year after acquir- ing the property. North- Marq arranged the financing through its correspondent relationship with Sentinel Investments. “Our client, a very success-
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8:00 am Development Forecasts for the next 10 years • forecasting the next 10 years of metro development: Modeling for site selection and development planning. •A fast paced overview of the key tools that you will need as you prepare for your next development •A Developers Tool Kit for 2015 •Development Opportunities that will change the face of New Jersey 8:50 AM Residential Builder and Developer Update • Evaluating land prices: Where they were, Where they are at andWhere are they going • What is the market for raw land and what does the deal need to look like today • What are the builders buying and why • How are land deals structured today and how is it different from the boom • What future opportunities exist 9:40 AM Break 9:50 AM How to EffectivelyWorkWith Municipalities • Annexation of parcels into cities • How cities our effectively working with builders to fast track the approval process • How are municipalities effectively working with home builders and commercial developers to spur growth • What are cities doing to attract investment in their communities 10:40 AMMarket Update • Inventory status • Current and future absorption • Land values: Where are they now and where are they headed • How does New Jersey’s Economic Growth+ stack up to the rest of the United States • Interest rates and other economic conditions affecting consumer confidence 11:10 AMWhat are the Opportunities for Commercial Development • What new opportunities for development are happening right now • What types of projects are in consideration for land development? • What needs to happen to get the market moving? Or do we have to wait until after the election • What are the challenges with land development vs. redevelopment? • Who is active in the market place and what is their risk tolerance and expected returns 12:00 PM Adjourn & Networking
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Paul Heilmann, Senior Vice President, Columbia Bank Speaker: 10:40 AM | Market Update BIO: Paul Heilmann is Senior Vice President (SVP) of Commercial Real Estate Lending and Commercial Construction Lending at Columbia Bank, one of New Jersey’s leading community banks with Total Assets of $4.3 Billion and 44 Branches. Heilmann is a member of the Bank’s Commer- cial Loan Committee and Senior Loan Committee. His responsibilities in- clude oversight of two lending groups. Prior to joining Columbia in 2004, he was the SVP of Commercial Lending at Penn Federal, a Newark, N.J. based bank for 10 years. Responsibilities included all commercial lend- ing activities including real estate lending, loan workout and accounts receivable lending. Heilmann was also the Bank’s designated environ- mental officer. He has also held positions as a VP of loan workout for Barclays Bank during the late 1980’s and early 1990’s, and was a Senior Associate in leverage finance for CA-NY during the mid 1980’s. Omer Mir Ahmed, Senior VP — Acquisitions, Russo Development Speaker: 8:50 AM | Residential Builder and Developer Update BIO: Omer Mir Ahmed is Senior Vice President and Head of Russo Devel- opment’s Acquisitions department. He has led an aggressive campaign to strategically expand the firm’s development pipeline and property holdings spanning industrial, multifamily residential, and mission critical property types. Specifically, Mr. Ahmed has led the acquisition of over $150,000,000 of acquisitions and dispositions over the past five years including over 1,000,000 SF of commercial space and land entitled for over 2,000. Meryl Gonchar, Partner/Co-Chair (Redevelopment & Land Use Department), Greenbaum Rowe Smith & Davis Moderator: 10:40 AM | Market Update BIO: Meryl A.G. Gonchar is Co-Chair of the Redevelopment and Land Use Department at the New Jersey law firm of Greenbaum, Rowe, Smith and Davis LLP. Her practice encompasses all aspects of land use, zoning and related litigation. She represents property owners and developers in appearances before planning and zoning boards throughout the state in connection with obtaining land use approvals and permits for resi- dential, retail, office, industrial and mixed use projects. She also repre- sents clients in land use and related litigation before the Superior Court of New Jersey. Ted Zangari, Member, Sills Cummis & Gross Speaker: 11:10 AM | What are the Opportunities for Commercial Dev.? BIO: Ted Zangari is a Member of Sills Cummis & Gross, a commercial law firm with New Jersey offices in Newark and Princeton. He is a Chair of the Firm’s Real Estate Department and serves on the Firm’s Manage- ment and Executive Committees. Zangari’s law practice is multipronged. He chairs the Firm’s Redevelopment Law Practice Group, captaining a team of Sills Cummis & Gross attorneys on large-scale mixed use proj- ects including land assemblage, redeveloper designations and agree- ments, tax increment financing and other public incentives, environ- mental remediation, commercial condominiumization and construction contracts. Joseph Romano, Accordia Company Speaker: 9:50 AM | How to Effectively Work with Municipalities BIO: Joe Romano has over 35 years experience in the real estate in- dustry and is a co-founder of Accordia Realty Ventures. Prior to join- ing Accordia, Joe was head of Advance Realty Group’s ARG Develop- ment Corporation. Joe brings to Accordia a vast background in every facet of commercial real estate including: site acquisition, development, marketing, leasing, planning, construction and value enhancement. He has been involved in every aspect of the business including the broker- age, development and corporate sides of the deal process. His in-depth understanding of client’s needs and goals, trends and inventory in the market, and contacts within the corporate real estate community have enabled him to conclude over ten million square feet of transaction s.
Richard F.X Johnson, Sr. Vice President — Development, Partner, Ma- trix Development Group Speaker: 8:00 AM | Development Forecasts for the next 10 Years BIO: Johnson joined Matrix in 1990, and is currently the partner-in-charge the development of office and mixed use projects within the Matrix port- folio, with a particular focus on transit-oriented and urban development/ redevelopment opportunities in New Jersey and Pennsylvania. Through- out his tenure with Matrix, Johnson has directed the company’s involve- ment in some of the region’s most challenging urban mixed-use develop- ments and significant build-to-suit corporate campuses: the 1,520,000 SF multi-phase $350 million headquarters of RCN Corporation in Lawrencev- ille, NJ; the 435,000 SF $40 million consolidated North American head- quarters of Okidata in Mt. Laurel, NJ; the 300,000 SF $65 million four- phase Advanta Corporation Campus in Horsham, PA; and the 486,000 SF $75 million headquarters facility for General Instrument Corporation in Horsham, PA. Johnson also has extensive experience in development consulting, and with sustainable design processes, specifically the use of renewable energy solutions in warehouse/distribution center buildings. Brian J. Whitmer, Senior Director — Capital Markets Group, Cushman & Wakefield Moderator: 8:50 AM | Residential Builder and Developer Update BIO: Brian Whitmer serves as Senior Director of the Metropolitan Area Capital Markets Group in C&W’s East Rutherford, New Jersey office. Part of a 13-member team, Mr. Whitmer is responsible for managing, underwriting, and marketing investment properties for sale and arrang- ing joint ventures in the suburban markets surrounding New York City. While he handles all asset types, his focus is on multifamily transactions. His clients include pension fund advisors, REITs, and a range of domestic and foreign private investors. Ronald Ladell, Sr. Vice President, NJ, AvalonBay Communities, Inc. Speaker: 8:50 AM | Residential Builder and Developer Update BIO: As Senior Vice President for New Jersey, Mr. Ladell oversees Avalon- Bay’s development activities throughout New Jersey. Mr. Ladell is based in the company’s Woodbridge, New Jersey office and focuses on devel- oping premier residential and mixed-use communities in high barrier to entry markets. Currently, AvalonBay is constructing communities in Roseland, Bloomfield, Wharton, Union and Princeton. Over the last few years, AvalonBay has built communities located in Somerset, Blooming- dale, Wood-Ridge, Hackensack, North Bergen, West Long Branch, Tinton Falls, Lyndhurst and Lawrenceville and has purchased communities lo- cated in Aberdeen, East Rutherford, Plainsboro and Watchung. Andrew Marshall, Executive Vice President — Development, Roseland Speaker: 8:50 AM | Residential Builder and Developer Update Andrew Marshall is responsible for directing and overseeing Roseland’s development portfolio from Boston to Washington D.C. with develop- ments currently in New Jersey, Massachusetts, Pennsylvania and Virgin- ia representing approximately 4,000 new units in process. He began his career with Roseland in 2003 as Vice President of Development. Prior to joining Roseland, Marshall was a Senior Manager for Ernst & Young’s Real Estate Consulting Group. He is a licensed architect and is a public member of the New Jersey Redevelopment Authority. Peter Kasabach, Executive Director — New Jersey Future Speaker: 8:00 AM | Development Forecasts for the next 10 years BIO: Peter has been actively engaged in the areas of housing and sus- tainable development and community revitalization for the past 20 years. Before taking the helm of New Jersey Future in December 2007, he was chief of policy and community development for the New Jersey Housing & Mortgage Finance Agency, where he guided investment pro- grams and developed a comprehensive state housing policy for use by the Department of Community Affairs. Prior to joining the HMFA, he oversaw all planning and real estate development activities for Isles, a private nonprofit community development organization in Trenton. Pe- ter holds a B.S. in Economics from the Wharton School of the University of Pennsylvania.
Carol Ann Short, Esq., Chief Executive Officer —NJ Builders Association Speaker: 8:00 AM | Development Forecasts for the next 10 years BIO: Carol Ann Short, Esq. is a seasoned government-relations profes- sional with extensive experience in the policy and management of hous- ing related issues in New Jersey. She assumed the position as Chief Exec- utive Officer in 2013 for the New Jersey Builders Association (NJBA), the State’s leading professional trade association dedicated to representing the interests of its members before the Legislature, Courts, Administra- tion and its regulatory agencies. Prior to that, Short served as the As- sociation’s Chief Operating Officer. For speaking and sponsorship information please contact Linda Christman at Lchristman@marejournal.com or 781-871-3456
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Mid Atlantic R eal E state J ournal Publisher ............................................................................ Linda Christman Publisher ............................................................................... Joe Christman Section Publisher .................................................................... Steve Kelley Associate Publisher .............................................................Alissa Aronson Associate Publisher ..........................................................Barbara Holyoke Senior Editor/Graphic Artist .................................................Karen Vachon Production Assistant ....................................................................Julie King Office Manager .................................................................... Joanne Gavaza Contributing Columnists ......... Mark Scott, Commercial Mortgage Capital; David Goldfisher, The Henley Group, Inc. 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. 27 Issue 5 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
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I n the wake of The Mort- gage Bankers Associa- tion ’s (MBA) Commer- cial Real Estate/Multifam- ily Housing Finance (CREF) conference, which was held at the Manchester Grand Hyatt in San Diego in early February, we noted several takeaways – namely that the market is currently in full swing and competition is heating up between lenders, all of whom are raising their targets. CMBS shops are also back in business and I’m see- ing Life Company lenders put out long-term 20/20; 30/30; 40/40 and even 50 year fixed rate self-liquidating money. However, given that there are serious questions regarding the health of the overall econ- omy, and the fate of interest rates remains uncertain, the next 60 days are undoubtedly the best timeframe in which to get deals done in 2015. The Mortgage Bankers As- sociation released a number of reports during the conven-
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tion, one of which projects originations of commercial and multifamily mortgages will grow to $414 billion in 2015, an increase of 7% from 2014 volumes, and continue to rise to $430 billion in 2016. Multi- family mortgages originated by mortgage bankers are fore- cast to be $152 billion in 2015. “Commercial and multi- family real estate finance markets are strong,” said Jamie Woodwell , MBA’s vice president of Commercial Real Estate Research. “Rising property values, improving property fundamentals, low interest rates and higher loan maturity volumes should all help boost mortgage borrow- ing and lending in the coming
continued on page 4A Meanwhile, 8%, or $121.0 billion of $1.5 trillion, of out- standing commercial and mul- tifamily mortgages held by non-bank lenders and inves- tors will mature in 2015, a 32% increase from the $91.7 billion that matured in 2014, according to the MBA’s 2014 Commercial Real Estate/Mul- tifamily Survey of Loan Matu- rity Volumes. Maturities will grow to $223 billion in 2016, year.” In addition, the MBA noted that commercial/multifamily mortgage debt outstanding is expected to continue to grow in 2015, ending the year at $2.7 trillion, more than 3% higher than at the end of 2014.
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M id A tlantic R eal E state J ournal Property totaling 328,500 s/f leased to A&R logistics CenterPoint announces the acquisitionof 167-acrecampus
MAREJ’s Spotlight on Multifamily Feat. POA EXPO We are inviting a select group of top MULTIFAMILY SPECIALISTS MARCH 27th publication Editorial Requirements Include: Half page ad with 550 word article Deadline: March 20th, 2015 Special advertising rates for all participating firms! Contact: Steve Kelley or your account executive Mid Atlantic Real Estate Journal Tel: 800-584-1062 x205 email to: skelley@marejournal.com
ORRIS, IL — Cen- terPoint Proper- ties announced the acquisition of a 167-acre rail- served transload, packaging and distribution campus in Morris, Illinois. The property is fully leased to A&R Logis- tics, one of the largest and most established bulk resin transloaders in the country. “CenterPoint continues to focus on the acquisition of logistically advantaged in- dustrial facilities that offer enhanced supply chain effi- ciencies,” said senior vice pres- ident strategic projects, Matt Mullarkey . “The asset is uniquely located and equipped to efficiently serve the growing plastic resin transload supply chain, supporting A&R Logis- tics’ core business strategy.” The campus features two state-of-the-art buildings to- taling 328,500 s/f, a DDG transload operation, 450 rail car storage spots and 80 acres of expansion land. Addition- ally, the property boasts direct access to Canadian National and efficient connections to the Burlington Northern San- ta Fe, Union Pacific & CSX rail lines. n KANSAS CITY, KS — M real estate auction
CenterPoint Properties an- nounced construction comple- tion and lease commencement for three tenants in a 300,000 s/f speculative facility at the CenterPoint Intermodal Cen- ter – Kansas City. The USDA Animal and Plant Health Inspection Service (APHIS) will occupy 104,500 s/f of the speculative, class-A specialized facility, neighboring Really Good Stuff, Inc. and UFP Har- risonville, LLC in 65,500 s/f. “The addition of three unique tenants to CIC-KC is a sign of a strong industrial market, especially for users
in need of state-of-the-art customized facilities adjacent to multiple modes of transpor- tation,” remarked vice presi- dent of development, Melissa Roman . The building, divided into three units to accommodate each tenants’ individual busi- ness requirements, is adjacent to Botts Rd. and U.S. Highway 150 in South Kansas City. The site is fully improved with completed infrastructure and features, 60’ speed bays, 32’ clear, 37-door dock doors with four drive-in doors and park- ing for 154 cars. n
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M id A tlantic R eal E state J ournal Prime location for warehousing company AMK USA NAI Hanson brokers lease for 39,309 s/f of industrial space
M
dents Jeffrey DeMagistris, SIOR and Thomas Vetter, SIOR represented both the landlord and AMK USA in this transaction. “Our team worked to find an optimal solution for both the landlord the tenant,” DeMagis- tris said. “From the standpoint of location and features, this space meets all of AMK USA’s needs.” n Stracke Anderson elected ITRA Global Chairman Emeritus for 2015
OONACHIE, NJ — NAI Hanson , a New Jersey-based commer-
cial real estate firm, announced that AMK USA, an existing tenant in the building, has ex- panded and extended its lease to meet their customer’s needs. Located at 131 W. Commer- cial Ave. in Moonachie, NJ, this space sits minutes from Rtes. 17, 46 and 80 and offers easy access to I-95. The facility fea- tures ample office space, 21-foot ceilings, four loading docks, 36’ X 30’ column spacing and a wet sprinkler system. NAI Hanson senior vice presi- dent TomRyan and vice presi-
2010 and 2011, the first wom- an to hold the seat, during
TYSONS CORNER, VA — Debra Stracke Anderson , president and CEO of Sloan Street Advisors / ITRA Global , has been elected Chairman Emeritus for the board of directors of ITRA Global. Anderson served as Chairman of the Board for
which she led the organiza- tion through unprecedent- ed global ex- pansion. A n d e r - son founded Sloan Street Advisors in 2000 follow-
Sealed Bid AUCTION FORMER SALVAGE YARD ON 17+-ACRES W/ CURRENT W. VIRGINIA SALVAGE LICENSE 474 WAUGH ROAD, BERKELEY SPRINGS, WV 25411 BIDS DUE FRIDAY, APRIL 10, 2015 BY 3PM
Debra Stracke Anderson
ing many years as an execu- tive with prominent commer- cial real estate companies. n State of the Market. . . the association predicted. Loan maturities vary sig- nificantly by investor group, reported the MBA. Just $11.5 billion (3%) of the outstand- ing balance of multifamily and health care mortgages held or guaranteed by Fannie Mae, Freddie Mac, FHA and Gin- nie Mae will mature in 2015. Life insurance companies will see $19.4 billion (6%) of their outstanding mortgage balances mature in 2015. Among loans held in CMBS, $73.0 billion (12%) will come due in 2015. Among commercial mortgages held by credit companies and other investors, $17.1 billion (12%) will mature in 2015. “After hitting a low last year, commercial and multifamily mortgage maturities are be- ginning to rise as the ten-year loans made in 2005, 2006 and 2007 come due,” said Woodwell, in a statement. “With strong market conditions, many of the loans slated to mature in coming years are already refi- nancing. Over the last year, the balance of loans set to mature in 2015 fell by $37 billion, or 24%.” While we can expect to see more transactions in 2015, there is still a certain level of uncertainty in the market and now is the time for borrower’s to lock in today’s low rates with a seasoned mortgage profes- sional. Mark Scott is principal of Commercial Mortgage Capital. n continued from page 2A
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W New America Foundation signs 50,536 s/f HQ lease NGKF lands anchor tenant for renovated 740 Fifteenth St. ASH I NGTON , DC — New Amer- ica Foundation, an agents for the property. “New America is a civic enterprise driven by big ideas
Applestein of Colliers reps. landlord BECO signs 12,000 s/f at BECO Tower II
ance of Columbus (AFLAC), signed a lease for 4,076 s/f of space. Clare Berrang of JLL Baltimore represented the tenant. Dr. Moshe Schwartz signed a lease for 3,217 s/f of space. Matt Haas of Colliers Interna- tional represented the tenant. Realistic Computing, Inc. is re-locating from Catons- ville into 2,144 s/f of space at BECO Tower II. The company- was represented by Douglas Kaufman of AGM Commer- cial Real Estate Advisors . HighTower Network signed a lease for 2,823 s/f of space. The company was represent- ed by Andy McIlvaine of DTZ . BECO Tower II is part of a two-building portfolio compris- ing 330,000 s/f of class “A” of- fice space, located off Exit 4 of I-795 (Northwest Expressway). Tenant-only amenities incorpo- rated into the portfolio include a state-of-the-art fitness cen- ter; a conference center that can accommodate 110 people; food service amenities and an outdoor nature lounge that in- cludes complimentary WiFi. n action is that it may represent a bellwether toward a solidi- fying local economy. Specifi- cally, the local market is very active with tenants that are reducing costs through down- sizing their space. But The Raben Group’s lease is based on actual business growth – and the resulting 63 percent increase in space.” “Our client’s new office is much more efficient and fea- tures an open layout,” Rich says. “The new design will offer more collaborative space and improved communication for TRG’s staff. They will occupy an entire floor in a higher-quality building with better amenities and prox- imity to Metro. The ‘team’ is extremely pleased with the outcome of this transaction.” Dallas-based TIER REIT owns 1341 G Street NW, a 127,600-square-foot property known as the Colorado Build- ing. n
best-in-class office environ- ment has successfully landed an anchor tenant for the building, in otherwise stag- nant market conditions. The upgrades to the historic property, combined with the location, views and onsite Joe’s Seafood, Prime Steak and Stone Crab restaurants distinguishes 740 Fifteenth St., NW, from its peers,” said Owen. New America's future of- fice is approximately 20,000 s/f larger than the space it occupies at 1899 L St. 740 Fifteenth St. will provide the organization with room to grow and onsite venues for hosting events, according to New America's leasing rep- resentatives MGA’s Michael Goldman, president, and Taylor Manning, managing director. Owen added, “There re- mains 48,496 square feet available for lease, including two full floors at approxi- mately 16,700 square feet each, or suites starting from 1,883 square feet. All common areas, including the lobby, tenant-only fitness center, el- evators and restrooms feature high-end finishes. n ties such as Hanover Crossing - especially those near ‘same day’ delivery markets such as Baltimore and DC – are now very well positioned. We think this will be a very excit- ing year.” L i b e r t y a c knowl e dg e s CBRE , JLL and Cushman & Wakefield for representing the company in recent transac- tions. The company also wishes to acknowledge the following brokers for their represen- tation of tenants in recent deals: Brian Sapp and Chris Armstrong with Fischer & Company , Dean Drewyer with Donohoe Real Estate , Michael Roden with CBRE, Jared Ross with Cushman & Wakefield, and Dave Scia- marelli with Mackenzie . n
and renew- ing Ameri- ca’s promise in the digi- tal age. We also curate unique ways t o e n g a g e with broad audiences,”
independent D C - b a s e d think tank, has signed a 15- year , 50 , 536 s / f lease for the t o p t h r e e floors at 740 F i f t e en t h
Brendan Owen George Vogelei
said Anne-Marie Slaughter, president and CEO of New America. “We believe our new headquarters supports and strengthens these goals. 740 Fifteenth Street is a modern- ized building that allows us to be proximate to the core of policy making while helping us to extend our reach far beyond the Beltway. As we reinvent the think tank, we’re thrilled to help forge a new America while staying close to our nation’s historic roots.” The nonprofit organization, which is relocating from L St., was attracted to 740 Fifteenth St.’s culturally significant location, visibility and its 16,700 s/f floor plates with exceptional views. “The John Buck Company's commitment to provide a which is really good news for the region.” The four new leases total 182,167 s/f with two renew- als for 122,068 s/f. Leases are located at the company’s new class A industrial property, Hanover Crossing – which is approaching 80% occupancy – as well as at Baltimore Wash- ington Industrial Park (Jes- sup), Ammendale Technology Park (Beltsville) and Corridor Industrial Park (Elkridge.) In 2014, Liberty executed nine deals totaling more than 470,000 s/f of industrial space across the region, in addition to commencing one of the region’s largest deals for 945,000 s/f. Goodwin also noted that “opportunities for midsize and large class A industrial proper-
St., NW. Listed on the Na- tional Register of Historic Places, the former Union Trust Building is located just one block from the White House and recently benefited from a multi-million dollar renovation project. The John Buck Com- pany acquired the 11-story, 175,000 s/f building, from the American Bar Association in 2011 and began renovations in 2013. These include mod- ernization and expansion of the building's lobby, as well as new elevator cab interiors, restrooms, common areas and fitness center. Newmark Grubb Knight Frank ’s Brendan Owen , chairman, metropolitan Washington asset services, and George Vogelei , director, are leasing COLUMBIA, MD — Lib- erty Property Trust an- nounced that it has completed six leases totaling 304,235 s/f of industrial space by mid-first quarter – four of which are new leases written for a what ap- pears to be a resurgent market group. “If there’s a difference be- tween the demand that existed at the end of last year and the start of this one, it is that local and regional companies seem to be much more focused on growing their businesses – and for that they need more space,” said Lisa Goodwin , vice president and city manager for Liberty in the Maryland region. “As the economy con- tinues to improve, signs indi- cate this activity is increasing,
BECO Tower II
OWINGS MILL, MD — BECO Management, Inc. has signed four separate leases totaling 12,260 s/f of space at BECO Tower II, a twelve- story, 200,000 s/f office build- ing situated at 10461 Mill Run Circle in the Owings Mills Town Center section of northwest Baltimore County. Gary Applestein of Colliers International represented the landlord in each leasing transaction. The leases were concluded with: American Family Life Insur- WASHINGTON, DC – West, Lane &Schlager Real- ty Advisors, LLC announced the closing of a new 11,452 s/f lease expansion and relocation on behalf of The Raben Group at 1341 G St. NW in DC. The 12-year transaction was negoti- ated by West, Lane & Schlager principals Ganon Rich and Eric West, LEED AP . The Raben Group plans to re- locate in April 2015 from 1640 Rhode Island Ave. NW, where it occupies about 7,000 s/f. The move was necessitated, in part, by The Raben Group’s ongoing staff growth and de- sire for a more “open” space plan. Rich said, “although they could have expanded within their existing building, it would have resulted in The Raben Group having to take space on two separate floors and live through a major renovation.” According to West, “The in- teresting aspect of this trans-
West, Lane & Schlager represents The Raben Group in 11,452 s/f lease expansion
Liberty Property Trust’s MD region sees resurgence with 304,235 s/f in leases in 2015
6A — March 13 - 26, 2015 — M id A tlantic
Real Estate Journal
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Commercial-Industrial Realty Council Join CIRC Now and Get Great Value! Great CRE Events ...Cont. Education...Speakers...Networking www.circdelaware.org
Annual Economic Forecast
Gubinatorial Address
Schedule of Upcoming Events MEMBERSHIP LUNCH EVENTS March. 11, 2015 (Wed.) Clarion Belle Speaker: Michael Hare, Buccini/Pollin Group April 8, 2015 (Wed.) Clarion Belle May 14, 2015 (Wed.) Clarion Belle Speaker: Paula Swain, Incyte Corporation ANNUAL GOLF OUTING June 29, 2015 (Mon.) Hartefeld National R.E. CONTINUING EDUCATION * Mod. 7 / Contemporary Issues Mod. 3 / Real Estate Documents Clarion Hotel-The Belle * Visit us on the web: CircDelaware.org for more information on our course provider and credits for DE*MD*PA*NJ: circdelaware.org/education/schedule.cfm Good Times / Great Reasons to Join CIRC! www.CircDelaware.org October 14, 2015 (Wed) * Mod. 4 / Office Management Mod. 5 / Legislative Issues: Agency Clarion Hotel-The Belle January 13, 2016 (Wed) *
2014 Board of Directors President John Birmingham Cushman & Wakefield Vice President Bert Root Harvey Hanna & Associates Treasurer Katherine L. Silicato, CPA Gunnip & Company, LLP Secretary Bayard J. Snyder, Esq. Bayard & Associates Directors /Committee Education Chair: Dan Lesher Patterson Woods Associates Legislative Chair: J. Gregory Ellis Patterson-Woods Associates Program Chair: Donald Robitzer The Commonwealth Group Membership Chair: James Manna MidCoast Community Bank Benjamin J. Berger, Esq. Berger Harris, LLC Jim O’Hara, Jr. NAI Emory Hill-Retail Div. Rachael Justice ATAPCO Christiana Marvin Sachs Bellevue Realty Co. BrightFields, Inc. Jeremy Abelson C. S. Kidner & Associates Economic Dev. Liaisons New Castle County Chamber Bob Chadwick NCC Ec. Dev. Council State of Delaware David Archer DEDO NCCo. Rep. City of Wilmington Jeff Flynn Office of Economic Dev. Contact Us www.circdelaware.org (302) 633-1705 janet@circdelaware.org Ex-Officio Members Business Manager Janet S. Pippert CIRC / Landmark Science & Engineering Legislative Lobbyist C. Scott Kidner
February Keynote: Augustine (Gus) Faucher, The PNC Financial Services Group John Birmingham ( CIRC Pres.) Cushman Wakefield (right)
January Keynote: Jack A. Markell, Governor State of Delaware Bert Root (CIRC VP), Harvey Hanna & Associates left) John Birmingham ( CIRC Pres.) Cushman Wakefield (right)
Thank you Joe Allen, Sonitrol (right) for your photography sponsorship.
Thank you Bruce Jones, PNC (center), for arranging for our Economic Forecast speaker.
F inancial D igest F eaturing 1031 E xchange
Real Estate Journal — March 13 - 26, 2015 — 7A
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M id A tlantic
CBRE arranges the sale of Turntable Junction and Fulper Center for $3m
EWARK, NJ — An- drew Stewart and DevMorris arranged HFF secures $65.5 million in financing for a 4-build Cronheim finances $28.1m for Newark’s 2 nd tallest bldg. N City and the Hudson Water- front.
Newark is New Jersey’s cultural, educational, legal and business hub. One of the key sources for demand are the city’s major employers, all headquartered within a three block radius of the subject property, as well as the city’s educational institutions. n
$28.1 million in financing for Eleven80, the second tall- est building in the Newark, NJ skyline. The loan was structured with a three year term and floating rate for the borrower, an affiliate of KBS Capital Advisors . The Subject is a 37-story high-rise consisting of 317 units and 418,797 s/f of build- ing area located at 1180 Ray- mond Blvd. Situated on a 0.30 acre site, the property was built in 1929 as an office building and converted in 2007 into its current use as a luxury apartment complex. The property additionally con- tains 7,567 s/f of retail space, currently occupied by TDBank and a convenience store. The property’s amenities and services are well in line with other class A+ apartment projects in New Jersey and Manhattan. These include a 24-hour doorman, shuttle service, bowling alley, bil- liards room, library, and 8,000 s/f fitness center. Eleven80 is strategically located two blocks fromNew Jersey’s larg- est transit hub, Penn Station, affording the subject property convenient access to New York BETHESDA, MD — Phil- lips Realty Capital (PRC) CEO C. Stephen Shaw, Jr. announced that the boutique commercial real estate in- vestment banking firm added three new analysts as well as a business development manager. This marks a time of significant growth for Phillips. Having closed about $1.3 bil- lion in 2014, the firm is in the process of increasing its staff by 20% in the first quarter of 2015. “Our people are our secret sauce, so we invest double what our competition does in personnel,” said Shaw. “It takes a lot of time and talent to provide the expert strategic analysis and precise under-
Turntable Junction and Fulper Center
closely with the principals and project management teams to ensure accurate and up-to-date financials. Having previously worked at Perkins+Will for more than nine years, LaValle is extremely familiar with the firm’s projects, procedures and people. Through- out her career, LaValle has held various financial positions at sev- eral other local architecture and design firms, including Hickok Cole Architects and Shalom Baranes Associates . n Turntable Junction & Fulper Center is a part of Flemington’s Business Improvement District and offers a variety of specialty shops and restaurants in the immediate vicinity. It is also located directly across the street from the Liberty Village PremiumOutlets mall. Located in the heart of Flemington, the property provides convenient access to major roadways, in- cluding Rte. 202. n secure aggressive pricing for the seller – heirs to an estate where the property had been in the same family for decades – from an out-of-state buyer. “This was a highly complex transaction due to the numer- ous residential and retail ten- ants involved,” said Berger. “The buyer has a significant up- side with the existing property and a compelling opportunity to improve upon the building’s efficiency and potentially rede- velop it down the road.”
FLEMINGTON, NJ — CBREGroup, Inc. announced that it has arranged the sale of Turntable Junction & Fulper Center in Flemington, for ap- proximately $3 million. The 5.3-acre property is a mixed- use retail and multifamily cen- ter that is near full occupancy. Charles Berger of CBRE Capital Markets’ Investment Properties team in New Jersey and Elli Klapper of CBRE Capital Markets’ Investment Properties team in New York served as the agents for the seller in the transaction while James Gunning , Donna Falzarano and Evan Kleppe of CBRE Capital Markets’ Debt & Structured Finance team secured the financing for the deal. The new owner plans to hold the property for investment purposes with the possibility for redevelopment in the future. The CBRE team was able to
Eleven80 Phillips Realty Capital adds three new analysts and business development manager
writing our clients expect from us. We are not trying to be the biggest name in commercial real estate capital, but we are delivering big results, so we are adding to our roster.” Connor Bell was most re- cently a financial analyst at Crestline Hotel & Resorts in the Development & Acquisi- tions group. Amanda Gestl , an attorney and financial analyst, comes to Phillips from regional real estate develop- ment company Buchanan Partners, LLC . Both Bell and Gestl are additions to PRC’s EB5 Capital real estate finance team. Peter Loukas previously focused on real as- sets investment strategies at Cambridge Associates and
joins PRC’s structured debt and equity finance team. Hav- ing been a research associate at The Costar Group , Lau- rie Peltola will develop and lead PRC’s market research team. “We are extraordinarily careful about who we hire,” said Shaw. “First and fore- most, I hire people who make me smarter. But there has to be a culture match. Every associate needs to be able to hold their own around our conference table and be as passionate as the rest of us about commercial real estate finance. We operate as a team here, and I couldn’t be more excited about this group of young recruits.” n
Judi LaValle returns to Perkins+Will’s DC office as director of finance
WASHINGTON, DC — Perkins+Will announced that Judi LaValle has returned to
the global ar- chitecture and design firm’s Washington, DC office as its director of finance. In this role, she will re- sume l ead
Judi LaValle
responsibilities for theDCoffice’s accounting department, working
8A — March 13 - 26, 2015 — M id A tlantic
Real Estate Journal
www.marejournal.com
F inancial D igest By David Goldfisher, The Henley Group, Inc. “Catch the wave”—Timing is key in CMBS loan workouts
D uring the next three years, a little more than $1 trillion in com-
which originated from 2005 through 2007. While memories can be somewhat short in our industry, most will agree that these CMBS loan vintages are arguably among the most ag- gressively structured and un- derwritten commercial mort- gages currently outstanding. In general, while properties within primary markets may be positioned to obtain viable takeout financing, given to- day’s underwriting guidelines and lower values, many other assets will struggle to be refi- nanced. The extent to which they struggle is dependent
on many factors not directly within a borrower’s control. However, one very important
loans representing record low levels. This is down from the 2012 peak of 10.3% or about
were healthy years for a prop- erty owner needing to borrow money in the capital markets. Projected CMBS volume for 2015 is estimated to be ap- proximately $125 to $130 bil- lion. Given today’s very low CMBS default rate, why would a CMBS Borrower be focused on a loan restructure? The tide is rising — Based on The Henley Group ’s re- search, 17% of all CMBS loans are either on the Servicer’s watch list or already trans- ferred to the Special Servicer. We believe the percentage will likely increase in the following three years. The upcoming 2015-2017 loan maturities, which comprise 2.5 times the loan volume that matured from 2012 to 2014, appear to already be taking a toll in markets that have not economically rebounded to the levels of 10 years ago. Many property own- ers with overleveraged loans are finding it difficult to justify expending capital for lease-up costs or deferred maintenance or even for persistent monthly debt service shortfalls. Frankly, if there is little chance of refinancing their current loan in any economi- cally reasonable fashion, mak- ing significant contributions to the property makes little sense, especially given the non-recourse nature of CMBS debt. While handing the Servicer the keys is always an option, due to tax consequences, reputa- tion concerns, and economic incentives, a modification or restructure of the current loan may yield a much more advan- tageous result for the Owner. Riding “the wave” to suc- cessful resolution —Owners should not procrastinate – the sooner the Owner begins the dialogue towards a resolution, the higher the probability of successfully retaining the property. The Henley Group, a CMBS loan workout specialist, has tracked data on the $1.5 billion in loan workouts that they have advised on since 2009. To view the results, visit (www.thehenleygroup. com/the-henley-group-risk-paradigm). Approximately two-thirds of the properties where the Owner was either “Proactive” or “Active” in dealing with is- sues resulted in a Borrower favored resolution. David Goldfisher is a co- founder and principal of The Henley Group. n
mercial mort- gages will be maturing. In and of itself, the sheer vol- ume of this tidal wave of ma t u r i t i e s will be a chal- l e n g e f o r lenders to
“Owners should not procrastinate – the sooner the Owner begins the dialogue towards a resolution, the higher the probability of successfully retaining the property.”
aspect is firmly within the bor- rower’s grasp. As in surfing, a key factor to successfully catching a wave is timing. CMBS loan restructures ebbing low — Currently, the CMBS delinquency rate is about 5.66%, comprising approximately $29.9 billion in
$60 billion. The number of loans more than 60+ days past due has dropped steadily from 2012 as many primary mar- kets have rebounded. CMBS issuance in 2014 was $105 billion vs. $86.1 billion in 2013 and $48.6 billion in 2012. By all accounts 2013 and 2014
David Goldfisher
digest. More significantly, ap- proximately one-third (~$350 billion) of these mortgages are CMBS loans, the majority of
Credit Company/ Portfolio Lender $10,500,000 Suburban Office FORBEARANCE AGREEMENT
Floating Rate CMBS Loan
$35,000,000 Regional Shopping Mall LOAN EXTENSION
With option for 50% Discounted Payoff
Fixed Rate CMBS Loan $12,000,000 Supermarket Anchored Retail DISCOUNTED PAYOFF - 36% PRINCIPAL REDUCTION
Fixed Rate CMBS Loan $16,000,000 Office DISCOUNTED PAYOFF
Loan Write-Down exceeded 50%
No Default
O: 508-318-6520 M: 617-320-0284 david@thehenleygroup.com www.thehenleygroup.com
David Goldfisher The Henley Group, Inc.
Workout Advisory for CMBS Loans
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