8B — December 14 -27, 2018— Northern New Jersey — M id A tlantic
Real Estate Journal
www.marejournal.com
N orthern N ew J ersey Sale highlights continued demand for stabilized, well-located, office/flex/R&D space Schultz, Georgiev of Newmark Knight Frank complete saleof 108,000 s/f office/flexbuilding inClark
LARK, NJ — New- mark Knight Frank (NKF) has negotiated the sale of Denholtz Associ- ates’ 108,000 s/f flex/R&D building at 175-195 Terminal Ave. in Clark for $15.84 million to ANG Management . NKF executive managing director Steven Schultz and manag- ing director Tony Georgiev handled the transaction. Since 1992, 175-195 Termi- nal Ave. has been leased as the headquarters of L’Oréal’s North American R&D divi- sion, one of six L’Oréal R&D centers in the world and the C
only one in the United States. Stretching across 7.61 acres, the building is a single-story, state-of-the-art flex/R&D space that recently underwent a sig- nificant renovation to extend functionality and create the modern research environment needed by one of the world’s largest cosmetics companies. 175-195 Terminal Ave. is a part of the Clark Commercial Center, a 10-building, 283,201 s/f portfolio purchased by Den- holtz Associates in a joint ven- ture with MB1 in 2015. Prior to their acquisition of 175-195 Terminal Ave. in 2015,
Denholtz recognized that an expiring lease with L’Oréal and the need for several sub- stantial capital improvements presented an ideal value-add opportunity. By initiating sub- stantial exterior and interior improvements, Denholtz was able to create a modern R&D space in line with tenant needs and negotiate a long-term lease extension with L’Oréal. The successful execution of this strategy also led to a stabilized flex/R&D asset that is now highly in demand with indus- trial buyers. “In an asset class dominated by long-term asset ownership like industrial, it might be hard to believe that value can be found in as short of a timeframe as three years,” said Steve Cassidy , president of Den- holtz Associates. “Despite that notion, we were able to create value in a relatively short peri- od of time at 175-195 Terminal Ave. through flawlessly execut- ing an improvement strategy that enabled us to retain one of the nation’s premier tenants. We thank Newmark Knight Frank’s Capital Markets team for their assistance in securing a premium price for this highly valuable asset in one of nation’s most competitive industrial markets.” Located just off Exit 135 of the Garden State Parkway between Central and Rahway Ave., the property features a uniquely accessible location in northern New Jersey, one of the nation’s largest industrial mar- kets. Comprising 633 million s/f of space, the northern New Jersey industrial market is characterized by high demand and a constrained supply pipe- line that has led to a vacancy rate of 4.8% and an increase of year-over-year rental rates of 14.3%. Within that market space, Union County’s flex/R&D sup- ply is even more constrained. Though there are two million square feet of existing space in the market, there has been no new construction, while sig- nificant demand frommajor life sciences companies has driven vacancy rates to a historic low of 3.1%. This demand has placed a premium on high- quality flex/R&D spaces like 175-195 Terminal Ave. “We are extremely pleased with results of this sale and it was an honor working with the Denholtz team on this transac- tion,” said Schultz.
175 Terminal Ave. in Clark
P o s k a n z e r S k o t t A r c h i t e c t s 550 North Maple Avenue, Ridgewood, NJ 07450 201.445.2322 www.poskanzerskott.com
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