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ISSUE HIGHLIGHTS Volume 33, Issue 7 Aug. 20 - Sept. 16, 2021
54 deals involve 6,052 units across New Jersey/Greater Philadelphia Region Gebroe-Hammer marks midyear with $917+ Million in multifamily sales
IVINGSTON, NJ — Multifamily revenue- stream clarity and re- inforced pricing have fed a reported $917+M in apart- ment-property transactions for Gebroe-Hammer Associ- ates as of midyear – marking a 100% increase in sales over the same period last year. In total, the nationally ranked multifamily-focused invest- ment brokerage firm has ar - ranged 54 deals involving 6,052 units during the first two quarters of 2021. “As expected, multifamily in- vestment volume and demand has more than just ‘picked up,’ it has skyrocketed thanks to positive performance metrics, the proverbial light at the end of the pandemic tunnel getting brighter, strong gains in ef- fective rents and a continued low-interest rate environment, which should extend well into the foreseeable future,” said firm president Ken Ura- nowitz , who has experienced every recessionary period PHILADELPHIA, PA — The PlymouthGroup , in part- nership with Centerbridge Partners, L.P., is officially underway on an ambitious bio- manufacturing redevelopment plan that puts the life changing therapies developed in Philadel- phia’s “Cellicon Valley” on the production line. Spaces will be L
out of New York City’s gentri- fied boroughs. Sales spanned North, Central and South Jersey as well as the Greater Philadelphia Region. According to Uranowitz, the multifamily recovery contin- ues to accelerate in a positive direction. He attributes this to vaccine rollouts, a lack of single-family home supply and affordability and a long- term, very accommodative Fed monetary policy. As is typi- cally the case, certain markets nationwide have fared better than others, most notably the NJ Metro. “Considered an edge-city market, the Garden State offers plenty of big-city urban-living options in the form of suburban transit-village settings,” said executive managing director David Oropeza . “Suburbs offer rent savings, more living space, top-ranked walkable neighborhoods, proximity to central business districts and – perhaps the most-important continued on page 18A that would revolutionize auto and rail car manufacturing and redefine standards for manu - facturing processes to this day. Underscored by the mobiliza- tion to a vaccine for COVID-19, the need for biomanufacturing is growing nationwide, with the immediate availability of ready space and strong labor pools defining the search. “Being able to deliver such a critical block of space, that is ready for tenant construction in a few short months, is crucial for Philadelphia to compete nationally with the surging demand for biomanufacturing space. The unique ability of Budd to expand through sub- sequent phases will provide opportunities for biomanufac- turing tenants to grow along with them,” said Joseph Fet- terman , leader of the Colliers life sciences practice group in the Philadelphia market who heads up the project leasing team. MAREJ
SPOTLIGHTS INVESTMENT/ MULTIFAMILY FINANCING
3-8A
ARCHITECTS/ ENGINEERS
4-8C
The Residences at North Village in Sparta, sold for $14.65M during Q2, is one of 54 deals arranged by Gebroe-Hammer Associates in 2021 thus far.
40 UNDER 40
Section D
since joining Gebroe-Hammer Associates at its inception 46 years ago. “While a number of notable economists projected a 25% to 33% increase in multi- family sales over last year, Gebroe-Hammer’s market specialists have shattered this benchmark and are reporting
a robust pipeline of exclusive and rare-to-market listings that will extend this streak through year end,” he said. FromJanuary through June, Gebroe-Hammer’s market spe- cialists have been active across the entire state of New Jersey, long considered a haven for former Manhattanites priced
20A
UPCOMING CONFERENCE September 30, 2021
Pioneering past informs future as Budd Bioworks takes shape in Philadelphia’s “Cellicon Valley”
7th Annual NJ Apartment Multifamily Conference October 27, 2021 Zoom Webinar 8th Annual NJ CRE Leadership Conference For speaking & sponsorship info., please contact: Lea at 781-740-2900 or lea@marejournal.com
The first two buildings of the Budd Bioworks. Pioneer at right will be ready for tenant construction in Q4 2021 Rendering: Plymouth Group / Wulff Architects
Directory ROP (Front Section) ........................................... Section A Financial Digest.........................................................3-8A Retail Development Reimagined. ............................ 9-14A DELMARVA. .......................................................... 15-17A CIRC........................................................................... 19A CCIM.......................................................................... 20A Business Card/Billboard Directory............................IBC-A New Jersey.............................................................. 1-10B Pennsylvania........................................................11-BC-B Owners, Developers & Managers....................... Section C 40 Under 40...................................................... Section D www.marej.com
ready for tenant construction as soon as Q4 of 2021, positioning Philadelphia to meet the swell- ing demand for cGMPmanufac- turing nationwide. The new development will be known as the Budd Campus with the 450,000 s/f Budd Bio- works representing Phase 1 of the project, a life sciences an- chor to a 2.4 million s/f adaptive reuse plan that encompasses six buildings on over 25 acres in the middle of a major metro- politan area. Budd Bioworks will com- prise 300,000 s/f of cGMP drug
manufacturing space along with 150,000 s/f of lab and office space. Residences, restaurants, retail and art activations are planned for subsequent phases within the greater Budd Cam- pus. Sitting directly between Phil- adelphia’s Center City and its suburbs, the former Budd Company Hunting Park Plant holds a significant place in Philadelphia’s manufacturing past and the world over, pro- ducing numerous pioneering innovations in the application of stamped and stainless steel
Inside Cover A — August 20 - September 16, 2021 — M id A tlantic Real Estate Journal
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Experience Yields Results
54 deals
6,052 units
$917+M in sales
Integrity • Leadership • Expertise • Trust
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IHOP Grove City, OH $1,948,479 Rite Aid P ttsville, PA 2,785,714
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M id A tlantic R eal E state J ournal Publisher, Conference Producer . .............Linda Christman AVP, Conference Producer ...........................Lea Christman Publisher ........................................................Joe Christman Editor/Graphic Artist ......................................Karen Vachon Contributing Columnist ....................................Dwight Kay, Kay Properties & Investments, LLC; Casey Murphy, NCIDQ, HF Planners; Kristin Fee, CPA, Withum Mid Atlantic R eal E state J ournal ~ Published Semi-Monthly Periodicals postage paid at Hingham, Massachusetts and additional mailing offices Postmaster send address change to: Mid Atlantic Real Estate Journal 350 Lincoln St, Suite 1105, Hingham, MA 02043 USPS #22-358 | Vol. 33, Issue 7 Subscription rates: 1 year $99.00, 2 years $148.50, 3 years $247.50 & $4.00 single issue - plus postage REPORT AN ERROR IMMEDIATELY MARE Journal will not be responsible for more than one incorrect insertion Phone: 781-740-2900 www.marej.com
By Dwight Kay
How Biden’s Tax Plan Could Affect Your Real Estate Investments
hould you sell your real estate investments be- fore any changes to capital gains taxes or 1031 exchanges get made? That’s what many people are ask- ing. But before you do any- thing, understand that there’s no telling what will come of President Biden’s tax proposals with a divided Congress, and you do have some interesting options in the meantime. I’ve been a professional real estate investor since prior to the Great Financial Crisis and have seen pretty much everything: Markets that go up and down, trends that fade away versus take hold and stay and, certainly, changes in political leader- ship that produce new tax policies. Now we have President Biden in the White House and are seeing his proclama- tions and policy positions. Let’s look objectively at indi- cations from the administra- S
tion and what could happen this year with potential implications for investment real estate. First things first, the econ - omy at the moment is on fire. U.S. GDP may top 6% this year, according to The Conference Board. To be sure, the recovery is uneven and Covid remains a serious factor on a global basis. But I note the macroeconomy be- cause at my firm, we believe there’s no better indicator of potential demand for in- vestment real estate. When the economy is expanding, demand increases, generally speaking, for income prop- erties occupied by business
users and multifamily prop- erties that provide rental housing to people. Watch for Changes to Capital Gains Taxes and 1031 Exchanges In terms of tax policy, now on the table from the Biden ad- ministration are some propos- als with the potential to affect investment in real estate: an increase in the capital gains tax rate and limits on the use of 1031 like-kind exchanges. (Basically, 1031 exchanges allow property investors to defer capital gains and other tax on investment gains when they reinvest the proceeds in other investment properties.) continued on page 14A
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F inancial D igest I nvestment /M ultifamily F inancing
M id A tlantic Real Estate Journal — August 20 - September 16, 2021 — 3A
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The Lincoln Park Towers acquisition and renovation is the final investment acquired $1B invested in affordable housing by HPVF’s First Private Equity Real Estate Preservation Fund
EWARK, NJ — Hud- son Valley Prop- erty Group, LLC (HVPG) has closed on the acquisition of Lincoln Park Towers, the final investment for HVPG’s first private equity real estate fund, Hudson Val- ley Preservation Fund, LLC (HVPF or the Fund). The $60 million of capital com - mitments raised paired with $120 million of co-investment equity has been leveraged to invest over $1B in projects, scaling their model of preserv- ing the financial and physical stability of affordable housing. “HVPG has developed a con- sistent process for revitalizing existing housing to preserve affordability, improve quality, and increase efficiencies,” said Jason Bordainick , CEO and co-founder. “Leveraging N
investors, banks, family of- fices, and individuals. The Fund made 13 investments in over 25 properties, pre- serving over 4,000 units of affordable housing for nearly 15,000 residents inMaryland, New Jersey, New York, and Pennsylvania. The Fund is Community Reinvestment Act-eligible and is evalu- ated using HVPG’s unique environmental, social, and corporate governance (“ESG”) reporting framework. Lincoln Park Towers, the Fund’s final acquisition, is illustrative of the proper- ties across the portfolio and HVPG’s mission. The 17-story historic building consists of 80 units of affordable, senior housing. In addition to pre- serving the long-term afford- ability of the property, the
redevelopment will include immediate renovations to individual apartment units; energy efficiency updates; safety upgrades; and new com- munity amenities such as a fitness room, lending library, and media center. Capital re- pairs include a new roof and repairs to windows, façade, and elevators. The building will also be set up with Wi-Fi and high-speed internet pro- vided at no cost to residents. This project is supported by the City of Newark through a new, 30-year Payment in Lieu of Taxes (“PILOT”) Agreement, and affordability is secured by a new 20-year project-based Housing As- sistance Payment Contract issued by the US Depart - ment of Housing and Urban Development. MAREJ
Lincoln Park Towers
private equity allows us to sig- nificantly expand our reach, earning a reliable return for investors while serving more
residents and communities.” HVPF was oversubscribed in March 2019, with com- mitments from institutional
Progress Capital arranges $53 Million in refinancing for newest luxury gated complex in East Orange, NewJersey
EAST ORANGE, NJ — Brad Domenico of Progress Capital secured $53 mil-
lion in refi- nancing for Ai ra j and I b r a h i m Ha s an , o f Blackstone 360 , owner/ developer of LOTUS 315 – an 8-story,
Brad Domenico
Class-A luxury mixed-use building located at 315 South Harrison St. Arbor Commercial Mort- gage provided 3-years inter- est only financing on a non- recourse basis. The property was bui lt in 2019 by Newark-based real estate development firm Blackstone 360 (B360), who owns and operates the gated complex. LOTUS 315 features a sleek, ship-like structured building with 180 residential units coupled with 33,151 s/f of ground-floor commercial space. Its apartment interiors are outfitted with strand- woven bamboo floors, stainless steel appliances, Italian-style
LOTUS 315
kitchens and an in-unit wash- er/dryer. Additional luxury essentials include gated entry, underground parking, 24-hour doorman and gorgeous outdoor garden with party lounge, private garden terraces and a state-of-the-art gym. The residence also provides shuttle service to Newark Penn Sta - tion, giving commuter tenants a hassle-free transportation option to the NJ Transit line with service to NYC.
LOTUS 315 is situated along the bustling corridor of South Harrison St. at the cross- section of East Orange and South Orange, for easy access to Seton Hall University and the East Orange VA Hospi- tal. Major highways includ- ing I-280 and Garden State Parkway are also within close proximity. B360’s business model is built on locating prime real estate within overlooked, ur-
ban markets and transform- ing these areas into high-end multi-family rentals. The firm’s heritage as a general contracting firm allows them to utilize a vertically inte- grated, 360-degree model of development, design and con- struction in-house, with the capacity to deliver tremendous stabilized value compared to cost. Since 1990, Progress Capital has closed over $40 Billion in
commercial loans and $150 Million in directly funded bridge loans. As a commercial real estate advisory firm, we can advise you on any real estate investment you are considering and provide the financing advice you need to manage through the com- mercial real estate acquisition and/or financing process. We consistently get our clients to the closing table… plain and simple! MAREJ
4A — August 20 - September 16, 2021 — Investment/Multifamily Financing — Financial Digest — M id A tlantic Real Estate Journal
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I nvestment /M ultifamily F inancing
By Pat Jackson, Sabal Capital Partners, LLC Commercial Real Estate Capital Markets Amidst Spreading COVID Variants
A
is increasing at a much slower pace and, despite some debt availability, fixed rate loans are off the table. Borrowers have little desire to lock them- selves into 10-year loans with lower proceeds. Floating rate, shorter duration loans are common today and, ultimately, this sector has a long road to recovery. Conduit lending is slowly climbing with strong demand for bonds giving lenders some confidence to transact. Spreads are tightening and COVID re- serves have relaxed. Yet many debt providers face volume
challenges. What may help volumes spike over the com- ing months are the caps put in place by Freddie Mac and Fannie Mae, as the agencies compete with the conduits. Caps could lead borrowers to turn to conduits to source debt. Additional agency activ- ity, including relaxed COVID reserves is noteworthy. With new leadership at the helm of the FHFA, the effort to remove the agencies from conservator- ship has stopped for now. It’s likely we will see the agencies focus on the country’s supply of affordable housing stock, a positive sign for multifamily finance activity. However, the apartments sector is still plagued by evic- tion moratorium issues. Once all the moratoriums expire, non-performing assets will be exposed. The industry should expect additional distress to emerge at that time. Despite that, the overall health of the multifamily sector is expected to sustain. If COVID-19 taught us anything, it’s that rental housing is undeniably essen- tial, in demand and resilient. Pat Jackson is CEO of Sa- bal Capital Partners, LLC. , a single-source commercial real estate lender. Sabal is a partner to both Fannie Mae and Freddie Mac in the agen- cies’ respective loan programs for multifamily properties na- tionwide. The company also of- fers a conduit CMBS program for core commercial real estate loans nationwide. MAREJ Cinnaire announces $52M Mid-Atlantic Capital Fund Closing MID ATLANTIC — Cin- naire announced the closing of the organization’s 2021Mid- Atlantic Low Income Housing Tax Credit (LIHTC) Fund. The $52 million fund will bring more than 570 units of affordable housing to com- munities across DE, MD, NJ and PA. The 2021 Cinnaire Mid- Atlantic Capital Fund will provide a tax advantaged investment and return to in- vestors, positive Community Reinvestment Act consider- ation from bank regulators, and supports Environmental, Social and Governance (ESG) investment strategies. MAREJ
s we enter the last quarter of 2021, some commercial real estate
resumed, however the sector continues to be impacted by inconsistencies across regional and international quarantine and vaccine mandates. Traffic at restaurant, retail and en- tertainment venues is proving steady, and some employers are bringing people back into the office, even if just some of the workforce for part of the time. These factors have partially improved commercial real estate dynamics, however the Delta virus variant is rap- idly gaining ground across the country and it, along with additional variants, is acting
as a commercial real estate recovery wild card. Obviously, not all is rosy. Capital markets reflect posi - tive improvements along with distress. After a considerable period of dealing with the pan- demic, lenders are more com- fortable financing the asset classes initially most impacted by COVID-19, with increasing interest in office and retail transactions. However, lend- ing activity is measured and could change at any time if new variants reverse economic progress. Finance activity for hotels
f undamen - tals continue to improve. Despite new COV I D - 1 9 v a r i a n t s w r e a k i n g havoc, much of the econ- omy has re-
Pat Jackson
opened and both the industry and consumers at-large have learned to adjust to a new, quasi-normal way of living and working. Some travel has
M id A tlantic Real Estate Journal — Financial Digest — Investment/Multifamily Financing — August 20 - September 16, 2021 — 5A I nvestment /M ultifamily F inancing
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6A — August 20 - September 16, 2021 — Financial Digest — M id A tlantic Real Estate Journal
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F inancial D igest
PrestonHollowCapital completes financing for The Highlander
Funding will support construction of 158 units in DC EagleBank provides construction financing for apartment complex
B ETHESDA, MD — Ea- gleBank , one of the larg- est community banks in the Washington, DC area, an - nounced that it provided financ - ing to support the construction of a luxury apartment complex in Northwest Washington, DC’s 16th Street Historic District. The project is a joint venture led by Perseus TDC and equity partner Allstate Insurance Company . EagleBank’s loan offering will fund a significant portion of total project costs, allow- ing Perseus TDC to construct a five-story, 158-unit luxury apartment building with an underground parking garage for both residents and Scottish Rite Temple patrons. The transac- tion was facilitated by members of EagleBank’s experienced commercial real estate team, senior vice president Barb Mackin , portfolio manager Sameera Rizvi and portfolio administrator Jeniffer Mejia . “As a trusted community lend- er, EagleBank is committed to delivering tailor-made solutions for our clients across sectors and markets,” said Ryan Riel , EVP, chief real estate lending officer. “We’re excited to have been in- volved in such a unique project
The Highlander
A spokesperson for Trinity Street Capital Partners in - dicated that its non-recourse construction lending program has gained considerable trac- tion in the last several months, as traditional banks still have Covid concerns or are over ex- posed to certain property types. Trinity is now winning major deals across the country as the firm marries its non-recourse construction lending programs with both its bridge and per- manent finance programs. TSCP’s permanent program is now originating loans with rates starting at the 10 year US Treasury + 100bps. MAREJ Provident Resources Group serves as the not-for-profit owner of The Highlander. SB Ballard, Inc. is the general contractor, with Blur Group serving as the architect. The Highlander will be managed by Aimbridge Hospitality . “As financing solution pro - vider for The Highlander, Preston Hollow Capital was committed to advance the so- cial and community benefits of the project, and we appreciate the opportunity to work with Radford University, its foun - dation, and the other valued partners involved with the project,” added Preston Hollow Capital chairman and CEO Jim Thompson . MAREJ low worked hand in hand with Radford University and the Radford University Founda - tion to execute the financing. Radford University Foun - dation CEO John Cox said, “Breaking ground for The Highlander is a thrilling day for the Radford University Foundation. The vision for the hotel has been a focus for the University and Foundation since 2019, and the support from Preston Hollow Capital has been an essential part of this project. The Foundation is excited for The Highlander and the positive impact it will bring locally, regionally and beyond.”
NEW YORK, NY — Trin- ity Street Capital Partners (TSCP) , a full service real es- tate investment bank, expands its construction lending pro- gram for its commercial mort- gage platform. Experienced owners and investors will now have access to non-recourse construction loans, up to 85% of cost for multifamily, indus- trial and self storage properties and up to 75% of cost for office and anchored retail properties. The program will focus on the top 200 MSAs in the United States and will have interest rates starting at 30 day Libor + 2.50%. Preston Hollow’s invest- ment consists of a $34 mil- lion Sustainability Bond – a designation which allows investors to invest directly in obligations that finance socially beneficial and sustain - able projects. Sustainability Bonds were adopted based upon sustainability frame- work guidance from the Inter- national Capital Markets Association and the United Nations Sustainable Devel- opment Goals . Preston Hol- RADFORD, VA — Pres- ton Hollow Capital , an independent specialty mu- nicipal finance company that supports local communities through creative, flexible and dependable infrastructure fi - nancing, today announced the successful execution of a $34 million financing to fund con - struction of The Highlander, a 124-room upper-upscale hotel that helps further Rad- ford University’s academic mission with the advent of its Hospitality Program. The Highlander also provides much-needed amenity to the University and the surround - ing community and features a rooftop restaurant and a 4,000 s/f conference space, provid- ing the University the ability to attract and host business conferences, expos, and Uni - versity events.
Perseus TDC
at the heart of one of D.C.’s most sought-after neighborhoods.” Elevated by its proximity to several amenity hubs, the proj- ect site is conveniently situated in a quiet, upscale neighbor- hood and is walkable to both the Dupont Circle and U Street metro rail stations. The prop- erty’s amenities will include 24/7 concierge services, coffee bar, fitness facility, rooftop pool and lounge with a commercial kitchen, multipurpose room and private courtyard garden. “The 16th Street Historic Dis - trict is a high-demand market for DC’s young professionals upgrades. An experienced real estate investor approached Green- Lake to refinance a portfolio of distressed gas stations due to an absentee tenant and complicated title issues. The borrower was in default with their existing lender and the bank had already foreclosed on one location. GreenLake provided funds enabling the borrower to re-acquire that key location, as well as to refinance and move away from a chal- lenging lender relationship. Additionally, the funds will allow the borrower to re-brand dent living units, 100 assisted living units, a 69-bed skilled nursing center and amenities. Springhill has 158 indepen - dent living and 35 personal care units, plus an 80-bed skilled nursing facility. The loans refinance bonds from 2012 and include a $20.4 million bank loan and tax- exempt, fixed-rate bonds total -
given the access to public trans- portation and popular ameni- ties,” said Adam Peters , re- gional partner of Perseus TDC. “Alongside our equity partner, Allstate Insurance Company, we’re looking forward to deliv- ering a best-in-class multifam- ily development that addresses the ongoing need for residential projects in the area.” The proposed residential de- velopment will offer various apartment layouts, including a unique mix of studios, one and two bedrooms, and townhouse- style duplexes with direct street access. MAREJ with a major international brand, and rehabilitate and upgrade the properties. Peter Chang , managing principal at GreenLake said, “While distressed properties pose complex challenges that lenders often shy away from, special situations are what GreenLake excels at. Our un- derwriting hinges on the un- derlying real estate asset and the sponsor’s ability to execute. Our view across multiple sec- tors gives us the insight, expe- rience and resources necessary to navigate and execute on these types of loans.” MAREJ ing $27.2 million. The bank loan utilized the Cinderella Bond structure, with initial issuance on a taxable basis until eligible for conversion to a tax-exempt rate in October 2021. The financing is projected to generate more than $400,000 of annual debt service savings through 2041. MAREJ
GreenLake funds $14,275,000 for portfolio of 8 Gas stations located in New Jersey and Pennsylvania
PHILADELPHIA, PA — Los Angeles based GreenLake Asset Management LLC
( G r e e n - Lake ) an - nounc ed i t has closed a $14,275,000 loan on eight gas stations l o c a t e d i n New Jersey and Pennsyl-
Trinity Street Capital Ptrs. expands non-recourse lending program
Peter Chang
vania. GreenLake’s funding allows the borrower to re- acquire a key location lost to foreclosure and will facilitate a major re-brand and significant
HJ Sims arranges $47.6 Million financing for two seniors housing properties in Pennsylvania
ERIE and MECHANIC- SBURG, PA — HJ Sims has arranged $47.6 million in financing for Asbury Com- munities Inc. The loans support two life plan communities —Bethany Village Retirement Center in Mechanicsburg and Springhill in Erie. Bethany includes two campuses with 400 indepen-
M id A tlantic Real Estate Journal — Financial Digest — August 20 - September 16, 2021 — 7A
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F inancial D igest
Client borrowed to fund construction on NY property Kennedy Funding closes $3 Million land loan inSt. Barths
E
borrower had excellent credit and the property was owned outright, with no outstanding debt against the St. Barths tract. Additionally, the prop- erty was appraised at more than $2 million higher than the purchase price. “In any other situation, it would not have even been a question that a borrower with a profile this strong would have been approved by a traditional financing institution,” Wolfer said. “However, the complexity of this loan, coupled with the fact that it crossed interna- tional borders, made this un- touchable for any other lender but Kennedy Funding.” Wolfer said that Kennedy Funding is the only lender who could make the deal happen. As an experienced firm in in - ternational lending, Kennedy Funding stands apart in its knowledge and experience in real estate and lending laws in the Caribbean, South America, and many other locales abroad. “Typically, when people think of land loans, they au- tomatically assume that both traditional and private lenders will pass over the opportunity,” Wolfer said. “That’s especially true when it comes to inter- national deals. Nobody except
Kennedy Funding has the knowledge, skills, local rela- tionships, and track record to close in other countries.” “St. Barths is a well-known luxury destination that at- tracts tourists from all over the globe,” Wolfer said. “Tour - ism continues to be strong, de- spite the challenges presented by the past year, and Ken- nedy Funding has a lengthy track record of closing loans abroad.” According to Wolfer, the firm has the experience, support staff, and knowledge necessary to navigate and successfully close loans in countries with vastly differ- ent regulatory, financial, and real estate landscapes. Most recently, Kennedy closed a $3.456 million land loan in Texas, a $2.3 million loan to construct a mixed-use prop- erty in the Dominican Repub - lic, and a $2.64 million loan in Brazil for an agricultural project. “Borrowers from all over the world come to Kennedy Funding because they knowwe have the strongest track record for land loans out there,” said Wolfer. “Simply put, nobody else can close a land loan, and especially an international land loan, like we can.” MAREJ
NGLEWOODCLIFFS, NJ —NY-based borrow- er needed a loan against
p r o p e r t y owned in an- other coun- t r y , t h e r e was only one lender who c o u l d g e t them to clos- ing: Kenne- dy Funding .
Kevin Wolfer
The Englewood Cliffs-based direct private lender an- nounced the closing of a $3 mil- lion land loan to JD St. Barth’s I. While Kennedy Funding stands alone in its ability to regularly and successfully close loans abroad, JD St. Barth’s I presented a unique challenge. “JD St. Barth’s I borrowed against land they owned in Saint Barthélemy to fund construction of a private home on land they owned in South Hampton, NY,” said Kev- in Wolfer , CEO of Kennedy Funding. “While this was cer- tainly a unique setup, we drew on our extensive experience working on land loans and on international loans to ensure our borrower secured the fund- ing necessary to fund construc- tion on their new home.” Notably, Wolfer said that the
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INVESTMENT HIGHLIGHTS: ✔ All-Cash/Debt Free Fund — No long-term mortgages
✔ Offering Size: $50,000,000 ✔ As Low as $50,000 to Start ✔ 8% Preferred Return* ✔ Flow Through of Tax Benefits to Investors ✔ Corporate Backed Net Leases with
tenants such as FedEx,Walgreens, Amazon, Fresenius, Dollar General & More!
covemidatlantic.com | info@covecapitalinvestments.com 1 (866) 847-7163
*This is a Regulation D Rule 506 (c) offering. All real estate and DST investments carry the risk of a complete loss of invested capital and that returns/ cash flow/appreciation/ distributions are not guaranteed and could be lower than anticipated. Preferred Returns are not guaranteed. Securities offered through Growth Capital Services, member FINRA, SIPC, Office of Supervisory Jurisdiction located at 582 Market Street, Suite 300, San Francisco, CA 94104. Potential returns and appreciation are never guaranteed and loss of principal is possible. Please speak with your CPA and attorney for tax and legal advice.
781.740.2900 marej.com/conf
8A — August 20 - September 16, 2021 — Investment/Multifamily Financing — Financial Digest — M id A tlantic Real Estate Journal
www.marej.com
I nvestment /M ultifamily F inancing By Brenner Green, Real Property Capital, Inc. Let’s talk leverage, everyone’s favorite topic in multifamily
E
verybody wants lever- age. Ninety percent of our clients are interest-
cap rates that have pushed investor and developer ex- pectations of value higher and higher. The easiest way to move the goal post is to continually achieve the lofty value estimates in developer proformas year in and year out. Naturally, at today’s rates, much like the US gov - ernment, most people would like to borrow as much as possible. Unlike other asset classes, which generally see higher cap rates, multifamily more
recently is not necessarily purely about loan-to-value. Currently, with few excep- tions, most lenders require at least a 1.3 times debt service coverage ratio (multifamily debt service coverage is cal- culated as net income, less reserves for replacements di- vided by debt service). Quick math will show you that at a rate of between 3% and 3.25% using a 30-year amortization, you will run up against the 1.3X pretty quickly at a cap rate of as high as 5%. What
this means is that it can be difficult to get to full (75%) loan proceeds, especially on smaller sub $10 million loans that don’t command premium pricing from the Fannie Mae and Freddie Mac lenders. In pre-COVID times when rates were higher, closer to 3.75% to 4%, the best solution was often a 10-year interest-only loan from a CMBS lender at 65% as this would in many cases result in a higher loan than an amortizing loan due to debt service coverage. Currently,
with lenders of all types of- fering incredibly low rates on multifamily, the best execu- tion to achieve the highest loan could come from a bank on a portfolio or a swap deal or from an agency lender, any of which could be as low as in the 2’s for the right deal. What this means for you as a bor- rower is that it is best to shop around in order to get the best deal, as a lower rate will also potentially mean higher loan amount, and right now there is no clear winner on what is the best way to go. On the construction side, if you have the time and if you can deal with the prevailing wage requirement, it’s very hard to beat a HUD-221d4 loan. We just closed one of these loans at about 87% loan-to-cost, completely non- recourse. The biggest advan- tage of the “d4” may be the fact that you can use the ap- praised value of land as your equity in most cases thereby avoiding normal bank re- quirements. Be prepared to deal with a lot of paperwork and to spend 10 months, give or take, to get to closing. Outside of this option there is not a deep market for what was once known as a “stretch senior” construction loan, although a couple programs exist targeting larger deals. The vast majority of the many non-recourse bridge lenders out there are not doing con- struction, and that’s probably a good thing to keep everyone honest in a market awash in capital. Banks have been sticking to their guns, and on loans of any kind of size ($5 million and up) expect to cap out at 75% max loan to cost, and maybe less depending on the numbers. It should be somewhat com- forting to know that in an envi- ronment where things can feel a little “pushed” there are still a number of ways to achieve very aggressive loan amounts. As long as these stars continue to align, expect to see values to continue to rise. R. Brenner Green is a 20-year veteran in com- mercial real estate finance and president of Real Property Capital, Inc., a full-service commercial mortgage banking firm based in the Philadelphia suburbs. MAREJ
ed in achiev- i n g ma x i - mum l o an proceeds as their prima- ry or second- ary objective in a given f i n a n c i n g assignment,
Brenner Green
this is acutely the case in multifamily following a de- cade of continually plunging
Recently Closed Loans
$44,995,000 108-Unit Multifamily HUD-221d4 Loan
Philadelphia, PA 3.10%, 40-Years 87% LTV, Non - Recourse
Real Property Capital is a Philadelphia based full service commercial mortgage banking firm with a regional focus and national capabilities. Our business model emphasizes client satisfaction through a high-touch, analytical approach that distinguishes us from the competition. Learn more about our distinct approach and proven track record of success at www.realpropertycapital.com. FOR MORE INFORMATION: R. Brenner Green, President 303 Harry Street • Conshohocken, PA 19428 • 610 - 456 - 9644 • bgreen@realpropertycapital.com
R etail D evelopment R eimagined
M id A tlantic Real Estate Journal — Retail Development Reimagined — August 20 - September 16, 2021 — 9A
www.marej.com
JLL Capital Markets completes sale & arranges $80.5M in acquisition financing for the 5 centers Grocery-anchored retail portfolio in the Philadelphia MSA sells for $114.25 Million
HILADELPHIA, PA — JLL Capital Mar- kets has closed the $114.25 million sale of and secured $80.5 million in ac- quisition financing for a five- property grocery-anchored retail portfolio throughout the greater Philadelphia metro area. JLL marketed the portfolio on behalf of the seller, Bran- dolini Companies . Para- mount Realty , in partnership with Medipower Group , purchased the assets. Addi- tionally, working on behalf of the new owner, JLL placed five separate fixed-rate loans with three banks. “We are excited to increase our footprint within the Phila- delphia MSA and we look for - ward to adding value through capital improvements and pro- curing a new diverse tenant mix for existing vacancies to P LYNCHBURG, VA — Cushman & Wakefield | Thalhimer announced the sale of the former Leggett’s Department Store, as well as Schewels Home Corpo - rate Office Headquarters in Lynchburg, VA. West on Church & Main, LLC purchased both proper- ties and plans to redevelop them with a combination of residential and commercial space. The former Leggett’s De - partment Store, a retail build - ing consisting of 41,143 s/f, is located at 1011 Main St., and was formerly owned by Mar- ketplace of Lynchburg, LLC. The purchase price for the former Leggett’s Department Store was $495,000. Schewels Home Corporate Office Headquarters, an of - fice building consisting of 60,630 s/f, is located at 1031 Main Street, and was for - merly owned by Schewels General Investment Partner- ship. The purchase price was $1,400,000. Schewels will be relocating their corporate
increasing or stable historical sales. All properties are located within highly populated resi- dential neighborhoods and engrained within the com- munities as destination real estate providing a combination of daily needs and e-commerce resistant businesses. Loca- tions include: • Lionville Shopping Center in Lionville (Giant anchored) • Marketplace at West - town in West Chester (Giant anchored) • Spring Towne Center in Sinking Spring (Giant and Lowe’s anchored) • Dreshertown Plaza in Dresher (George’s Market - place anchored) • Limerick Crossing in Lim - erick (ALDI anchored) The JLL Capital Markets in- vestment sales advisory team that represented the seller
was led by senior managing directors Chris Munley and Jim Galbally , Senior Direc - tor Colin Behr and Associate James Graf. The JLL Capital Markets debt placement team that represented the new owner included senior managing directors Jon Mikula and Jim Cadranell , director Michael Pagniucci and analyst Carlos Silva . “We continue to see a signifi- cant increase in demand for grocery-anchored shopping centers,” Galbally said. “The investor interest for retail and specifically grocery anchored shopping and dominant power centers has greatly increased in late 2020 and throughout 2021. It was a pleasure to work with both the Brandolini Companies, Paramount and Medipower on a successful transaction.” MAREJ
Marketplace at Westtown
cater to the evolving new retail landscape,” said president of Paramount Realty, Maurice Zekaria . The portfolio garnered sig- nificant interest from the in -
vestment world, particularly since each asset was anchored by high-performing grocers and a home improvement tenant (Giant, George’s Mar- ket, ALDI and Lowe’s), with
Cushman & Wakefield | Thalhimer broker sale of former Leggett’s Department Store and Schewels Home in Lynchburg, VA
1031 Main St.
1011 Main St.
offices. GeorgeLupton, III, CCIM and Norman Moon, Jr., CCIM, SIOR, CRE, FRICS and of Cushman & Wakefield | Thalhimer handled the sale negotiations on behalf of the seller.
In Toano, Cushman & Wakefield | Thalhimer an - nounced the sale of the Design Master Building located at 3005 John Deere Rd., within Stonehouse Commerce Cen - ter, in Toano (James City
County). Tetreault Holdings, Inc. purchased the 40,000 s/f in- dustrial building, situated on 4.13 acres, from Friendship Partnership for $2,668,320 as an investment for their con- tracting business, The Drying
Company. Dawn F. Griggs, SIOR of Cushman & Wakefield | Thalhimer handled the sale negotiations on behalf of the seller; Clay Culbreth , also with Thalhimer, represented the purchaser. MAREJ
10A — August 20 - September 16, 2021 — Retail Development Reimagined — M id A tlantic Real Estate Journal
www.marej.com
R etail D evelopment R eimagined
Dartcor partnerswith New Stand at Work
YogaFit&Spa leases 1,900 s/f at TheLivingstonTownCtr. AzarianRealty Co. announce recent retail openings in NJ
EW JERSEY — Az- arian Realty Co. announced four new leases and five new openings in the recent months. The Az- arian Group was founded in 1970 and its owned and man- aged portfolio includes 18 com- mercial properties throughout New York and New Jersey totalling over 1,200,000 s/f . Recently Signed Leases Allendale Town Center, a 90,000 s/f grocery-anchored shopping center in Allendale, adds Poke Time to its mix of 16 stores. Poke Time has leased 2,008 s/f , making it the restaurant’s second area location. The re- maining vacant spaces range from 2,008-3,524 s/f . Two new leases have been signed at the Walgreens Shop- ping Center, a 40,000 s/f shop- ping center located on Rte. 46 in Fairfield. Chiropractor Dr. Leonard Russo leases 1,550 s/f of office space for the practice’s third location. Additionally, Delizia Pizza Kitchen leases 2,000 s/f for its fourth loca- tion. One remaining vacancy is available at 1,500 s/f . YogaFit & Spa leases 1,900 s/f at The Livingston Town Center in Livingston. The re- maining vacant spaces at the two-floor, premium town cen - ter range from 2,064-4,434 s/f . New Openings The highly-ant i c ipated grand opening of Mayweather Boxing+ Fitness took place on June 12, 2021 at The Shoppes at North Brunswick in North Brunswick. Mayweather Box- ing+ Fitness leased 3,397 s/f in the upscale lifestyle center POMPTON PLAINS , NJ — The Goldstein Group an- nounced that Popeyes Louisi- ana Kitchen has signed a lease for a pad site under construc- tion located at Plaza 23, 500 Rte. 23 North, Pompton Plains, according to Chuck Lanyard , president of The Goldstein Group. The deal, which consists of 2,510 s/f, was brokered by Chris Conway , director for The Goldstein Group represent- ing the tenant. Rob Murphy from Philips Edison & Com - pany represented the landlord, Plaza 23 Station LLC. “The free-standing pad site offers Popeyes outstanding N
New Stand at Work
Philadelphia and New York City metro markets. “Dartcor and New Stand share a common vision of what tomorrow’s workplace could and should be. In combining the New Stand’s technology, media, and design expertise with our culinary and hospi- tality strength, we can offer a workplace dining experi- ence that is more convenient, healthier and more sustain- able,” said Warren Leeds , CEO of Dartcor. “Together, this partnership will continue to leverage the power of food and hospitality to ease the transition back to the office for employees.” “Dartcor is an ideal part- ner for us in corporate office settings, as their approach, philosophy and commitment to quality align perfectly with New Stand’s” said Andrew Deitchman , CEO and co- founder of New Stand. “New Stand at Work is all about cre- ating highly-curated experi- ences around each installation that make peoples’ days bet- ter. Offering, locally-sourced, high-quality, delicious, fresh food is an important part of the formula for success.” Inspired by world-class chefs and culinary experts, Dartcor’s highly customized food service programs elevate corporate dining and deliver unique hospitality experiences that help make the return to the workplace exciting, healthy and engaging. Built around an attention to detail, creativity and high-touch customer service, Dartcor’s services are guided by an understanding that food has a unique power to not only nourish individuals but to fuel organizational culture and enhance the bottom line by increasing engagement and promoting employee wellbeing for a healthier, more efficient workplace. MAREJ
WHIPPANY, NJ — Dart- cor , one of the region’s lead- ing providers of premier cor-
porate din- ing services, announc ed it has been named the first operat- ing partner to New Stand , an amenities provider for
The Livingston Town Center
and it will be the franchise’s. first location in New Jersey. Fair Lawn Medical Arts Center has leased 1,297 s/f to Dr. Cella, Foot and Ankle. One vacancy remains at 2,331 s/f . The use is exclusively medical and professional. The newly renovated Pine Brook Plaza on Rte. 46 in Pine Brook has had two new stores open in recent months. A 940 s/f hair salon, Luxe Hair Studio, and a 2,111 s/f fitness space, Marc Wahlberg’s F45 Training. This is Luxe Hair Studio’s first location. F45 Training has been ranked the #8 fastest growing franchise by Entrepreneur. com. The remaining vacancies in Pine Brook Plaza include
two 900 s/f spaces, both of which are 2nd generation res- taurant spaces. Fitness Together, another fitness franchise, has leased 1,479 s/f in The Montvale Shopping Center in Montvale. Fitness Together has over 120 locations in the US. The shop- ping center is now fully leased. The Azarian Group, L.L.C. is a privately-owned, full ser- vice property management / development organization engaged in the acquisition, development, redevelopment, management, leasing, insur- ing, construction and finan - cial management of retail, commercial and investment properties for its own portfolio as well as third parties. MAREJ
Warren Leeds
microcommunities in the New York City and Philadelphia metro areas. Established in 2015, New Stand is a New York City-based day improve- ment company pioneering tech-powered “newsstands” to provide everyday conve- niences, curated goods, and exclusive experiences. The company’s New Stand at Work product is focused on expand- ing the New Stand concept into office buildings across the country. Built to redefine the tradi - tional office experience, New Stand at Work offers contact- less micromarket solutions powered by propriety point- of-sale technologies, giving employees seamless access to snacks, beverages and grab- and-go meals, as well as help- ful products such as pain re- lievers and umbrellas. Today, the company has 20 locations across the US. With an eye to- wards continued growth, New Stand announced a $40-million Series B funding round led by Brookfield Property Group , one of the largest real estate owners in the United States, earlier this year. The partnership will enable New Stand at Work to bring Dartcor’s chef driven grab- and-go menu to their markets in office buildings across the region. In addition, Dartcor will be the first corporate food service provider to offer New Stand’s one-of-a-kind grab-and-go solutions in the
Conway of The Goldstein Group brokers 2,510 s/f deal in Pompton Plains, NJ
visibility,” said Lanyard. “Pla- za 23 is a strong neighborhood shopping center anchored by a grocery market and Jackson Ave. is a heavily traveled road leading to the local communi- ties.” The shopping center is an- chored by Stop & Shop, TJ Maxx, HomeGoods, Smash- burger, VerizonWireless, Moe’s Southwest Grill, GNC, Jersey Mike’s Subs, Playa Bowls, Vi- sion Works, and Sally Beauty. Popeyes Louisiana Kitchen was founded in 1972 as a sin- gle retail store in Cleveland, Ohio. MAREJ Pad site under construction located at Plaza 23, 500 Rte. 23 North
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