www.marejournal.com Mid Atlantic Real Estate Journal — Industrial / Distribution Centers — May 31 - June 13, 2013 — 11B I ndustrial R eal E state & D istribution C enters

By Louis Oliva, SIOR, CCIM, Newmark Grubb Knight Frank Pittsburgh industrial market


Slow Start to 2013 The first quarter of 2013 yielded mixed results

first quarter. The largest lease transaction was the expan- sion of Holtec International by 200,000 s/f in Keystone Com- mons in the East submarket. Other notable leases included HDS Marketing for 34,000 s/f in the West submarket and Aquion Energy leasing 29,000 s/f near the Rostraver Airport in Westmoreland County. The largest user sale was in Butler County with BillcoManufactur- ing selling its 60,000 s/f facility to Markovitz Ents Inc for $2.5 million. Newmark Grubb Knight

Frank facilitated one of the largest industrial investment sales during the first quarter of with the $20-million purchase of the 410,000 s/f Turnpike Dis- tribution Center by Virginia- based Centurion Investments. This was one of the first truly institutional grade industrial assets to trade in recent mem- ory as the property received interest from institutional buy- ers throughout the Midwest, Mid Atlantic and Northeast regions of the country. It is expected that this transaction may lead to additional capital

markets activity and institu- tional investment in Pittsburgh as investors seek yield in stable secondary markets. The lack of institutional-quality assets has been the biggest deterrent his- torically, but with the strength of the class A market, develop- ers should be confident of an exit strategy for well located, institutional-quality, stabilized industrial buildings. Looking ahead to the second quarter, the entire Pittsburgh economic development commu- nity is holding their collective breath on the go/no go decision

by Royal Dutch Shell regarding the potential construction of an ethane cracker plant on the site of the Horsehead Zinc facility in Beaver County. The decision is expected by the end of June and the prospect of a multibillion dollar construction project and long term impact on the entire Pittsburgh region is clearly a game-changer for the market in general and the industrial sector specifically. Louis Oliva, SIOR, CCIM is executive managing di- rector at Newmark Grubb Knight Frank. n

for the Pitts- burgh indus- trial market as the U.S. e c o n o m y dea l t wi th t e p i d j o b growth and negative im- pacts from

Louis Olivia

the payroll tax increase on retail spending and the sequester on government spending. Overall market vacancy increased 70 basis points from 7.4% to 8.1% as several large blocks of space became available offsetting a few new building completions, and some additions were made to the competitive inventory. As a result, over 9.4 million s/f of space is now vacant within the 116 million s/f of inventory. However, classAspace remains scarce with only 1.4 million s/f vacant or 4.6% of total class A product. Recent announcements re- garding plant closures will have an impact on the market in the near term although several are providing unique inventory which could be an opportunity for larger occupiers. FLABEG announced they will be closing their 220,000 s/f solar panel production facility in the air- port corridor/West submarket and United Stationers will be vacating their 124,000 s/f ware- house in Cranberry/Northwest submarket later this year. Both buildings are class A quality and should be well received by the market. There were several nota- ble transactions during the SOUTH HACKENSACK, NJ —The NAI James E. Han- son team of executive manag- ing director Michael Walters, SIOR , and VPs Jeffrey DeM- agistris and Thomas Vetter represented the property own- er, 30 Wesley St., LLC in two leases. In the first transaction, S&K 2000, Inc. signed on to oc- cupy 26,556 s/f at the 246,000 s/f site. NAI Hanson senior VP Andrew Somple , SIOR, rep- resented the tenant. Additionally, DeMagistris and Vetter represented the landlord in the renewal of a 44,452 s/f lease that Staples will use for warehousing. n NAI Hanson inks over 70,000 s/f of industrial deals


STRONGER. In 2012, Newmark Knight Frank and Grubb & Ellis came together to create global real estate powerhouse Newmark Grubb Knight Frank . One year later, our explosive growth is a testament to the success of this union, and to the power of the capital, management, and technology support of our parent, BGC Partners. We are proud of all we’ve accomplished, from bringing on board top talent nationwide, to expanding our coverage in key markets. We’ve bolstered our service RĝHULQJVLQFOXGLQJFDSLWDOPDUNHWVJOREDOFRUSRUDWHVHUYLFHVUHWDLOLQGXVWULDO property management and valuation services, providing an unparalleled platform to our clients. :LWKRĠFHVHPSOR\HHVDQGPLOOLRQVTXDUHIHHWunder management nationwide, NGKF continues to distinguish itself as a formidable presence in the commercial real estate industry. We look forward to continuing our transformative growth, further expanding our market share and partnering with our clients to meet their local and global needs. Together, our momentum is unstoppable.

Gerard McLaughlin Executive Managing Director gmclaughlin@ngkf.com Louis Oliva Executive Managing Director loliva@ngkf.com 33*3ODFH6XLWH3LWWVEXUJK3$7

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