The December 2024 issue of the Mid Atlantic Real Estate Journal (#MAREJ) features a "Year in Review" spotlight, industry news, and market insights. The issue also covers commercial real estate deals, workforce housing trends, and sustainability initiatives.
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ISSUE HIGHLIGHTS Volume 36, Issue 12 December 2024 YEAR IN REVIEW SPOTLIGHT
E 150 Milford targets 100%+ GHG reductions through decarbonization Galvanize Real Estate expands portfolio with industrial acquisition in Central NJ air sourced heat pumps for heating and cooling,” said N icolette Jaze , head of ESG & Sustainability, Galvanize Real Estate.
AST WINDSOR, NJ — Galvanize Real Es- tate (GRE) , the sus- tainable real estate strategy of investment firm Galvanize Climate Solutions (Galva- nize) , announced its acquisi- tion of a 608,000 s/f industrial asset located at 150 Milford Rd. along the I-95 corridor in Central New Jersey. Well- located in proximity to stra- tegic logistics infrastructure including interstate highway systems, deep-water cargo ports, intermodal terminals, and air freight capabilities, 150 Milford provides access to criti- cal supply chains and distribu- tion solutions. The building is the third acquisition in GRE’s growing real estate portfolio. “We believe that 150 Milford serves as a perfect comple- ment to our existing portfolio along the I-95 corridor,” said Joseph Sumberg , managing partner & head of Galvanize Real Estate. “We’re delighted to grow our New Jersey pres- ence and build a pipeline of re- silient energy efficient assets
GRE’s business plan includes value-add improvements to the asset and a reduction of on- site carbon emissions by up to 266-324% over the property’s baseline, achieved through a series of initiatives with stra- tegic solar and decarbonization partners. This could amount to approximately 65,000 metric tons of CO2e (carbon dioxide equivalent) avoided over 30 years or nearly 8,502 homes’ energy use for one year. “This acquisition aligns well with our strategic vision of investing in high-potential in- dustrial assets in prime mar- kets,” said Nadine Ander- son , VP, Acquisitions, Gal- vanize Real Estate. “Central New Jersey’s attractive solar programs, robust logistics network, and growing demand for industrial space make this property an ideal addition to our portfolio.” MAREJ
Section B
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HISTORIC HAGERSTOWN BUILDING
150 Milford Road
as part of a traditional value- add strategy. “150 Milford leverages more than 600,000 s/f of rooftop space to provide the in-place tenant with onsite renewable power. It also takes advantage of a rich community solar program to distribute renew- able energy to the local util- ity. In addition, we intend to electrify the property where possible with the conversion of fossil fuel fired systems to
in markets with strong real estate fundamentals.” According to the US General Services Administration, on average, buildings with higher energy performance are ex- pected to save $1.64 psf in total annual expenses compared to legacy stock buildings. GRE views this as a significant op - portunity to acquire inefficient assets and invest in their decarbonization and onsite renewable energy generation
TO HIT THE AUCTION BLOCK THIS JANUARY
AION Partners & Goldman Sachs Alternatives announce $700M JV to expand Mid-Atlantic workforce housing
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CONFERENCES 8th Annual NJ Healthcare & Medical Properties Conference January 23, 2025 For speaking & sponsorship info., please contact: Lea at 781-740-2900 or lea@marejournal.com
of AION Partners. Since 2011, AION has ac- quired and redeveloped over $3.9 billion in workforce hous- ing, comprising more than 29,000 apartment homes. Workforce housing is designed to serve households earning 60% and 120% of the area me- dian income, generally under $75,000, yet despite 60% of the U.S. population falling within this range, there is a notable shortage of investment capital dedicated to housing for this underserved demographic. AION’s proprietary divisions, AION Management, and AION Construction Management, will continue to focus on quality property management and ex- ecution of value-add improve- ments across the properties. This recapitalization marks AION’s fifth large-scale trans - action, contributing to the firm’s 20,000-unit multifamily portfolio. MAREJ
value-add multifamily acquisi- tions, with plans to add 4,000 to 6,000 apartment units, backed by a $300 million equity com- mitment. The joint venture will combine a 49% investment from a global institutional investor and 51% by AION Value Add III LP, AION’s third discre- tionary fund vehicle. Goldman Sachs Alternatives will be an investor in AION Value Add III LP’s first close slated for the fourth quarter of 2024. “As the undersupply of at- tainable housing persists, AION’s skill in acquiring and redeveloping workforce com- munities is essential to provid- ing high-quality, affordable homes that benefit middle- income families and strengthen local economies. This part- nership allows us to broaden our impact in regions where demand is strongest,” said Mi- chael Betancourt , founding partner and managing director
MID ATLANTIC — AION Partners has partnered with Vintage Strategies at Gold- man Sachs Alternatives and a global institutional investor to recapitalize the AION 12 Portfolio of 3,962 apartment units across twelve stabilized workforce housing multifamily properties in New Jersey, Penn- sylvania, Delaware, Maryland,
Directory
and Virginia. This recapitaliza- tion builds on AION’s success- ful track record of creating value by enhancing the quality of workforce housing through intensive asset management and capital discipline. In addition to this nearly $700 million recapitalization, AION has formed a strategic partnership to increase work- force housing across the east- ern United States. The joint venture targets $1 billion in Cherry Hill Towers in NJ
Financial. .................................................................. 3-7A CIRC Organization . ....................................................... 8A DelMarVa..................................................................... 9A New Jersey............................................................10-15A Pennsylvania......................................................... 16-17A Owners, Developers & Managers..........................18-25A People on the Move...................................................26A Business Card Directory.............................................27A CRE Organization’s Events Calendar ............................ 28A Year In Review................................................... Section B www.marej.com
Inside Cover — December 2024 — M id A tlantic Real Estate Journal
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*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.*The There is a risk Investors may not receive distributions, along with a risk of loss of principal invested. This material does not constitute an offer to sell nor a solicitation of an offer to buy any security. Such offers can be made only by the confidential Private Placement Memorandum (the “Memorandum”). Please read the entire Memorandum paying special attention to the risk section prior investing. IRC Section 1031, IRC Section 1033 and IRC Section 721 are complex tax codes therefore you should consult your tax or legal professional for details regarding your situation. This material is not to be construed as tax or legal advice. There are material risks associated with investing in real estate securities including illiquidity, vacancies, general market conditions and competition, lack of operating history, interest rate risks, general risks of owning/operating commercial and multifamily properties, financing risks, potential adverse tax consequences, general economic risks, development risks and long hold periods. There is a risk of loss of the entire investment principal. Past performance is not a guarantee of future results. Potential cash flow, potential returns and potential appreciation are not guaranteed. Securities offered through FNEX Capital, member FINRA SIPC.
M id A tlantic Real Estate Journal — December 2024 — 1A
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FOR SALE - 31.75 Acres Industrial Land – I-81 Corridor NEPA
31.75 acres of well positioned industrial real estate for sale in the Grimes Industrial Park. The Grimes Industrial Park is home to international and regional tenants. TJ Maxx distribution center, one of the largest industrial properties in northeast Pennsylvania (1,000,000± SF), is located in the park. This GIP parcel is positioned at the corner of Commerce Road and Sathers Drive and has significant frontage on both roads. Easily accessed by Navy Way at exit 178 on I-81, this property is zoned industrial, has all approvals in hand for up to 277,100 SF of new construction, and has access to all utilities.
Grimes Industrial Park I-81 Corridor - Northeastern Pennsylvania
Property Features • Approval process completed. Approvals in hand for up to 277,100 SF of newIndustrial Construction. • 31.75 contiguous acres (6.87 acres Dupony Borough, 24.88 acres Pittston Twp). • Easy access to Interstate 81, PA Rte 315 and Rte 476 NE extension PA turnpike. • Located in Grimes Industrial Park, home to TJ Maxx Distribution hub +/-1,000,000 SF , Fed Ex, Cascade, US Hydrations, etc. • Prominent position in Grimes Industrial Park at the corner of Commerce Rd and Sathers Drive. • Park is adjacent to Centerpoint Trade Park (ie. Lowes, UPS, Fed Ex. Etc) Industrial Development Opportunity
2A — December 2024 — M id A tlantic Real Estate Journal
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M id A tlantic Real Estate Journal
M id A tlantic R eal E state J ournal Publisher, Conference Producer ..............Linda Christman VP, Conference Producer .............................Lea Christman Editor/Graphic Artist ......................................Karen Vachon Contributing Columnists ...Marcia Kaufman, Bayport Funding Mid Atlantic R eal E state J ournal ~ Published Monthly Periodicals postage paid at Hingham, Massachusetts and additional mailing offices Postmaster send address change to: Mid Atlantic Real Estate Journal 117 HMS Halsted Dr., Hingham, MA 02043 USPS #22-358 | Vol. 36, Issue 12 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
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NAIOP Office Space Demand Forecast
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ASHINGTON, DC — Net absorption of office space turned
positive in the second and third quarters of 2024, follow - ing five consecutive quarters of shrinking demand. Although it is still possible that a reces - sion could delay a recovery, recent trends suggest the office sector is stabilizing and that demand for office space will grow modestly in 2025, accord - ing to the NAIOP Research Foundation’s Office Space Demand Forecast. The report was authored by Hany Guirguis, Ph.D., Man- hattan College and Joshua Harris, Ph.D., CRE, CAIA, Fordham University. Net absorption is the amount of space occupied less the amount that is vacated in a given period. According to the report, office space absorption was 1 million s/f in the second quarter of this year and 4.9 million s/f in the third quarter. “Net office space absorption in the fourth quarter of 2024 is expected to be 9.4 million s/f, with another 10.8 million s/f of positive absorption for the full year in 2025 and 3.9 million
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s/f of positive absorption in the first three quarters of 2026,” said the report. The authors note that the of - fice market has benefited from the sustained outperformance of the macroeconomy and jobs market, and some prominent firms have indicated they are requiring workers to spend more time in the office than in prior years. Recent positive ab - sorption should be seen as an encouraging sign that demand for office space has begun to stabilize, though anemic de - mand growth has yet to catch up with new construction. According to data provider CoStar , 17.0 million s/f of net new space was delivered in the second and third quarters of 2024, resulting in a small in - crease in the average vacancy
rate, from 11.7% to 11.8%. The pace of new deliveries has slowed from 27.1 million s/f delivered over the second and third quarters of 2023. “We’re pleasantly surprised to see positive absorption in the office market, driven by demand in the tech sector and the decisions of many companies to bring their teams back to the office,” said Marc Selvitelli, CAE , president and CEO of NAIOP. “We are optimistic that these prove to be durable trends.” The NAIOP Research Foun - dation was established in 2000 as a 501(c)(3) organiza - tion to support the work of individuals and organiza - tions engaged in real estate development, investment and operations. MAREJ
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M id A tlantic Real Estate Journal — Financial — December 2024 — 3A
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F inancial Ryan Stoll, and Taylor Mokris secure loan from a national commercial bank BWE secures $57.8M to refinance senior living community in Douglassville, PA for ReNew REIT
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occupied Blossom Vale Senior Living in Orangevale, CA, part of the Sacramento metro -
OUGLASSVILLE, PA — BWE has se- cured $57.8 million
politan area. The 5-year, competitive fixed-rate bank loan with flexible prepayment, no deposit re - quirements, and an earn- out structure
to refinance Ke y s t o n e Villa at Dou - glassville, a 247-unit, class A inde - pendent liv - ing, assisted living, and memory care community.
Ryan Stoll
Taylor Mokris
allowed the borrower to enjoy the upside of the stabilizing operations and rent growth of the renovated units. MAREJ
Ryan Stoll , national direc - tor of Seniors Housing and Care at BWE, and Taylor Mokris , senior vice presi - dent of Seniors Housing and Care, secured the loan from a national commercial bank, which features a non-recourse structure prepayment flex - ibility, a competitive rate, and full-term interest-only pay - ments. The loan was secured on behalf of a joint venture between private investment trust ReNew REIT and opera - tor Heritage Senior Living. “To deliver the best results for the borrower, our team sorted through a complex and competitive process to deter - mine which lender offered loan terms best tailored to the joint venture’s needs. Ultimately, the sponsor was able to forge a new relationship with a na - tional commercial bank who offered just that,” said Stoll. “We pride ourselves in being execution agnostic when it comes to finding the right capi - tal solution for a project, mak - ing it easy for our partners to trust they will always end up with the best lender and loan for their unique needs.” Keystone Villa at Doug - lassville, located at 1152 Ben Franklin Highway, is com - prised of a 123-unit indepen - dent living building, and a 125-unit assisted living and memory care building con - structed in 2011. Located in a vibrant suburb of Philadelphia, Keystone Vil - la features a host of amenities and activities for residents, including restaurant style dining, movie theater, and a lively social scene including a bakers’ club, trivia challenges, yoga, educational speakers, walking trail access to ample green space, on-demand trans - portation, excursions, garden - ing, and more. BWE’s Seniors Housing and Care team also recently closed on acquisition financing for the recently renovated, 92%
Keystone Villa at Douglassville
4A — December 2024 — Financial — M id A tlantic Real Estate Journal
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F inancial Borrower will use loan proceeds to fund reno. of Old Mill Guest House venue in Wallkill, NY Kennedy Funding closes $1.445M loan to expanding event space in the Hudson Valley
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showers, corporate retreats, and similarly-sized events for up to 200 people, with over - night accommodations for up to 50 people. Old Mill Guest House is part of Audrey’s Farmhouse, a hospitality group that oper - ates several retreats and event spaces in upstate New York. Proceeds will be used as work - ing capital and put toward im - provements of Old Mill Guest House’s existing buildings. “Old Mill Guest House is a stunning location for an unfor - gettable event, surrounded by old-growth trees, ponds, and
the peace and quiet that the Hudson Valley is known for,” said Kevin Wolfer , CEO of Kennedy Funding. “A charm - ing wedding venue like this one is primed for a busy season, booking into 2025 and 2026 — just in time to debut beautifully renovated accommodations, funded by a working capital loan we were pleased to close for this borrower.” According to Edwin Urrego , executive loan officer at Ken - nedy Funding, the property was purchased by Audrey’s Farmhouse in June 2019 for $275,000. The company has
invested nearly $3 million into construction and other capital expenditures since purchasing the property. “Tourism and getaways in the Hudson Valley have been on the rise ever since the COVID-19 pandemic, and it’s now the second-largest tour - ism market in New York,” Urrego said. “Old Mill Guest House is a vibrant part of the region’s $5 billion tourism industry, and will continue to put the Hudson Valley region on the map for intimate holi - day getaways and large family celebrations alike.”
The deal was brokered by Raymond Dellovo Jr. , president of Medford, MA- based International Lending Network. Audrey’s Farm - house was referred to Dellovo by representatives from a lo - cal bank, who were in the mar - ket for a private lender who could help fund the hospitality group’s expansion efforts in Wallkill. Dellovo’’s first call was to Kennedy Funding. “I have been working with Kennedy Funding for more than 30 years; they are the #1 company I work with,” said Dellovo, citing their long- standing track record of more than $4 billion in closings. “They are more expensive than a bank, but they deliver—they always deliver exactly what they promise. They have a lot of integrity. They know how to get approvals and are quick to close,” adds Dellovo. Central to Kennedy Fund - ing’s lending philosophy is the way the firm examines the merits of every deal, evalu - ating its impact on the com - munity — and potential for generating revenue. “When we evaluate a deal, we want to get a true sense of the project’s viability and future success, and that’s not something that you can tell from a rigid checklist or a set of arbitrary criteria,” Urrego said. “Because we have the freedom to fully assess an op - portunity from all angles, we’re able to get clients like Audrey’s Farmhouse the funding they need to grow.” Audrey’s Farmhouse intends to market Old Mill Guest House as a wedding venue, complete with essential services like catering and furniture rent - als. The grounds of the estate include event space, a 5,000 s/f wooden pergola, a seasonal heated saltwater pool with cabanas, and a beautifully manicured central courtyard surrounded by structures that date back to the 19th century. The property is located around 90 minutes from New York City and 30 minutes from the New Jersey border, easily accessible throughout the Tri- State Area and Pennsylvania. Renovations are planned for the lodges, totaling 19 bed - rooms across four buildings. “Kennedy Funding was able to deliver this loan when tradi - tional lenders couldn’t,” Urrego said. “That’s the void we fill in the marketplace.” MAREJ
NGLEWOOD, NJ — A quaint and peaceful Hudson Valley retreat
is expanding its footprint in the wed - ding events space, with help from K e n n e d y Funding. The NJ- based, direct
Edwin Urrego
private lender closed a $1.445 million loan to 323 Old Mill LLC for Old Mill Guest House in Wallkill, NY, a 24-acre property that hosts weddings,
M id A tlantic Real Estate Journal — Financial — December 2024 — 5A
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F inancial
Refinance Just Arrived
Just Arrived
Land Acquisition
$1,445,000
$1,883,000
323 Old Mill LLC Wa llkill, New York
Axe Lake R esort Inc. McMur rich/Monteith, Ontario, Canada
A 124-acre land acquisition in Ontario. Refinancing in New York. Both loans closed in record time. With fast turnarounds and flexible terms, we’re ready to deliver funding for acquisition, construction, refinancing, and cash-outs. Our borrowers turn to us, ‘cause we’re always two steps ahead of Pressure. With over $4 Billion in closed loans, why would you go anywhere else?
Call 1-800-342-8500 or visit KennedyFunding.com
land, development and acquisitions, bankruptcies, discounted payoffs, note purchases, workouts and foreclosures
6A — December 2024 — Financial — M id A tlantic Real Estate Journal
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F inancial
A newspaper specifically written for 1031 Exchange investors Kay Properties founder Dwight Kay publishes the “ 1031 Exchange Times ”
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out as an essential resource in the dynamic world of Delaware Statutory Trusts,” said Kay. Investors are encouraged to sign up for a free subscription to the 1031 Exchange Times by vis- iting https://www.kpi1031.com. About Kay Properties and www.kpi1031.com: Kay Properties helps investors choose 1031 exchange invest- ments that help them focus on what they truly love in life, whether that be their children, grandkids, other businesses, travel and hobbies (NO MORE 3 T’s! Tenants, Toilets and Trash). We have helped 1031 exchange investors for nearly two decades exchange into over 9,100 - 1031 exchange in- vestments. Please visit www. kpi1031.com for access to our team’s experience, educational library and our full 1031 ex- change investment menu. Diversification does not guarantee profits or protect against losses. All real estate investments provide no guar- antees for cash flow, distribu - tions or appreciation as well as could result in a full loss of invested principal. Please read the entire Private Placement Memorandum (PPM) prior to making an investment. This material is not to be consid- ered tax or legal advice. Please speak with your attorney and CPA before considering an investment. All offerings dis- cussed, if any, are Regulation D, Rule 506c offerings. Past performance is not a guarantee of future results. Securities of- fered through FNEX Capital, member FINRA, SIPC. MAREJ
Investment Options • How Growing Regu - lation Continues to Hurt Independent, Self-Manag- ing Apartment Investment Property Owners • What is a DST 1031 Exchange, and How Can It Help You? • Why Investors Should Con - sider 100% Debt-Free Invest- ing in Today’s Turbulent Times • Bonus! Delaware Statutory Trusts Can Be Both an Anchor and Buoy Investments The 1031 Exchange Times joins an entire robust library of Delaware Statutory Trust educational assets created by Kay that include: Weekly Webinars: Each week, Kay Properties founder and CEO, Dwight Kay and the Kay Properties team of DST experts, regularly host educational webinars and special events to help inves- tors understand the 1031 exchange process and the many nuances of Delaware Statutory Trust properties. DST 1031 Conference Calls Every Friday at 11 a.m. PST/2 p.m. EST Kay Proper- ties also hosts an interactive live conference call where one of our DST 1031 exchange experts discusses a variety of pertinent topics related to DST 1031 properties. 1031 Exchange Delaware Statutory Trust Educational Dinner Events Each month, Kay Proper- ties & Investments holds din- ner events where accredited 1031 exchange investors are invited to learn more about
the Delaware Statutory Trust investment strategy and prop- erties available on the www. kpi1031.com marketplace. These invitation-only events provide accredited investors the opportunity to meet some of the most knowledgeable DST 1031 exchange experts in the entire country. The Kay Properties Blog Page - A Great Resource for Learn- ing More About DST Trends, Recent DST 1031 Transac- tions, and Insights from DST 1031 Exchange Experts Kay Properties prides itself on the extensive and original library of relevant articles that are both searchable and chock-full of exclusive, valu- able information. Visit www. kpi1031.com/blog to learn more about the very latest trends in the 1031 exchange, Delaware Statutory Trust and 721 ex- change investment world. “We are excited about the 1031 Exchange Times news- paper, and know it will be a valuable resource for investors who are eager to deepen their understanding of the Delaware Statutory Trust investment vehicle, 1031 exchange strate- gies as well as 721 exchange UPREIT investment options. By offering comprehensive insights, expert advice, and real-world examples, the news- paper will appeal to both novice and seasoned investors alike. Whether you’re looking to step away from active property management or simply inter- ested in learning more about 1031 and 721 exchange strate- gies, this publication stands • 1-mile from Exchange Place and the PATH station in Jersey City. • 20-minutes from Lower Manhattan. • 30-minutes from Down - town Brooklyn. • Adjacent to Liberty State Park. • Midtown Manhattan via the Holland or Lincoln tunnels Tulfra has developed 1,000,000 s/f of self-storage facilities in a dozen locations throughout northern New Jersey. Tulfra has worked closely
ORRANCE, CA — Dwight Kay , found- er and CEO of Kay
Properties & Investments , a national leader in Delaware Statutory Trust equity place- ments and 1031 exchange investor education, proudly announced the publication of its exclusive 1031 Exchange Times . The newspaper will provide relevant news relat- ing to 1031 Exchange and DST investments for investors nationwide. The newspaper also will provide readers an in-depth look at active Regu- lation D Rule 506c Delaware Statutory Trust offerings found on the www.kpi1031. com online marketplace. According to Kay, publisher and executive editor of the newspaper, the 1031 Exchange Times covers a complete look at the Delaware Statutory Trust investment structure while also providing investors with very specific 1031 Exchange strategies that have been suc- cessfully executed by thou- sands of Kay Properties clients. The newspaper is being de- livered to tens of thousands of 1031 exchange investors over the coming weeks. “Kay Properties has been helping 1031 exchange inves- tors evaluate DSTs, UPREITs (umbrella partnership real estate investment trusts) and 721 exchange offerings for nearly two decades and has helped thousands of investors nationwide. Furthermore, I have personally invested in nearly 100 Delaware Statutory Trust investments, so the vast
majority of articles in the 1031 Exchange Times is based on years of personal investment experience,’” said Kay. For example, Kay pointed to articles that range from providing thoughtful analysis into the growing concerns landlords have regarding rent control and other regulations to a unique DST 1031 Exchange investment thesis that is called the “Anchor and Buoy” invest- ment strategy. “We knew our investor com- munity would embrace a news- paper that is focused solely on detailed and well-researched articles that will help Delaware Statutory Trust and 1031 ex- change investors become better educated when it comes to con- sidering tax smart investment strategies,” said Kay. According to Dwight Kay, inside the 1031 Exchange Times newspaper, readers will discover articles covering subjects such as: • Three 1031 Exchange The Kay Properties & Investments “1031 Exchange Times” delivers 1031 Exchange and tax deferral news to real estate investors nationwide.
Tulfra announces construction loan for Liberty Storage Center JERSEY CITY, NJ — Tul- fra Real Estate , a Rochelle Park, New Jersey-based real estate and development com- pany, announced the closing of a loan to fund construction of Liberty Storage Center, a six-story, 795-unit self-storage facility located at 300 Thomas McGovern Dr. in Jersey City. The project will be managed by Public Storage . with city and state agencies for five years, to secure the proper permits to transform a former concrete plant into a class A storage facility. Tulfra Real Estate an- nounced the closing of a per- manent loan for The Delford at Village Center, a 160-unit luxury rental community. construction has begun on the first phase of Liberty Storage Center. The new Liberty Storage Center is
Fully-leased in record-setting time, The Delford has already proven to be one of the most successful rental projects in Bergen County. The fixed-rate loan was secured by JLL Capital Mar- kets through Nuveen Real Estate. Representing JLL in the deal were Vice President Ryan Carroll , Klein and Mikula. MAREJ
The loan to TFJ Jersey City LLC was secured by JLL Capital Markets . Michael Klein and Jon Mikula , of JLL represented Tulfra on the transaction. Jeff Wallace and John Lipiros represented the lender, Fulton Bank . Mitch- ell Berkey and Joseph Za- wila of CSG Law represented
Shown from left: John Lipiros, Fulton Bank; Mitchell Berkey, CSG Law; Jon Mikula, JLL; Denise Ridley, Jersey City Councilwoman; Salvatore Frassetto, Tulfra; Steven Fulop, Jersey City Mayor; Sonny Jumani, Tulfra; Lucas Grunberger, Tulfra; Elya Golubitsky; and Marcus Lee, Tulfra.
controlled facility will be the first of three phases totaling 260,000 s/f. Site work and
the borrower. When completed, the six- story 103,500 s/f, fully climate-
M id A tlantic Real Estate Journal — Financial — December 2024 — 7A
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F inancial By Marcia Kaufman, Bayport Funding Maturity Issues: What are the solutions for performing borrowers?
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to buy time in the event of a delay. You don’t need loans for another year; you need just a couple of months to get to the finish line. This makes refinancing a great option if you’re a borrower who has lim- ited or no flexibility with your current lender, if you’re in the process of transitioning a fix- and-flip and are not yet ready for permanent financing, or if you need more time on a multifamily project to lease out the apartments prior to refinancing a permanent loan. If you’re an experienced borrower with a strong track
record in a major U.S. resi- dential market like the New York tri-state area, Florida, and Texas, you can – and should — consider working with a residential transition lender that specializes in refi - nancing. A lot of lenders don’t have the flexibility to move from one fund to another, so firms that have both the capa - bility and the experience are incredibly important to have in your corner. Time is money, and refi- nancing takes less time than starting from scratch because there’s no buyer/seller dynam-
ic to negotiate. The transaction is between you and yourself, so you’re not waiting for other parties. This means you’re in much better control of your time and can get through the application process faster. Notably, refinancing is not as expensive as a new loan. Many of the costs associated with short-term bridge loans aren’t incurred again in the refinancing process. For ex - ample, title insurance is avail- able at a reissue rate, which is a discount from the premium, in states like New York and New Jersey.
All that being said, now is the time to ensure a smooth transition for when your loan matures. The end of the year is one of the hardest times to get your refinancing applica - tions done. Business generally slows down in December as people take off for the winter holidays. Companies may be closed on days that aren’t fed- eral holidays, like Christmas Eve or New Year’s Eve. It’s important to be realistic about these circumstances as you prepare your application. The refinancing experts at continued on page 23A
ultifamily and fix and flip property owners know the
pressure — there are five weeks left on your bridge loan, but there’s six months’ worth of work that still needs to
Marcia Kaufman
be done. It’s quite understand- able: these kinds of projects now take much longer to com- plete than they used to, wheth- er due to supply chain issues, the size of the project, permit holdups, or any number of surprises that unfold during a remodeling or construction project. Simply put: The clock is ticking, and time isn’t on your side. While needing more time is standard as far as construc- tion goes, lenders are much less forgiving. Many value-add or multifamily investment projects are funded with short- term loans that come with 12- or 18-month terms. These loans may allow one short extension, but most don’t. Financial institutions are already hesitant to approve extensions, and those slim chances become more unlikely at year’s end, when banks begin to offload loans. They’re already constrained by their credit facility’s guidelines and have little wiggle room to work with borrowers, no matter how reasonable the request. This situation is, unfortu- nately, not uncommon. Yet, it does not, and should not, reflect poorly on qualified borrowers with solid payment histories. The project delays are stressful enough and an imminent loan maturity dead- line makes it even more diffi - cult for borrowers. It’s unfair that borrowers are at risk of defaulting, even with excellent credit and payment history, due to circumstances that are no fault of their own. When the loans are good, the projects are sound, and you as a borrower have an excellent profile, you’re not out of luck. There are refinancing options out there that provide you with breathing room and more time to plan. Refinancing options give qualified borrowers a longer runway to complete their projects. These financial prod - ucts are precisely designed
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8A— December 2024 — M id A tlantic Real Estate Journal
www.marej.com
M id A tlantic Real Estate Journal — DelMarVa — December 2024 — 9A
www.marej.com
D el M ar V a
Hurley Auctions presents rare opportunity to acquire iconic 100,000± s/f landmark Historic Hagerstown YMCA building to hit the auction block this January
H
AGERSTOWN, MD — The historic YMCA building in downtown
Hagerstown is going to auction in J a n u a r y of the New Year! The 100,000± s/f Neo-Geor - gian style structure
Matt Hurley
was erected in 1920 by the 11 Y11 Organization as a YMCA (Young Men’s Christian Asso - ciation) center to provide a safe space for young men to escape the dangers of the streets. The building was designed by local architect Fred J. Mack (1878-1957) who had formed a partnership with Charles E. Kountz in Hagerstown in 1907. The firm of Mack and Kountz was in existence for only a few years, but Mack became known for his multiple works in Hag - erstown as well as the former Stohr College in Harpers Ferry, West Virginia, and buildings at Mercersburg Academy, Mer- cersburg, Pennsylvania. At the age of 24, he was responsible for the design of the Chalfonte Hotel in Atlantic City. Mack’s architectural design of the Hag - erstown YMCA can still be seen today with the classical styles of the 19th century. According to the Maryland Historical Trust, he donated all of his time and efforts as well as the project designs to the city. The former YMCA, located at 149 N. Potomac St. in down- town Hagerstown, is just two blocks north of Public Square and in close proximity to the newly constructed Meritus Park, Barbara Ingram School for the Arts, The Maryland Theatre, Western MD Regional Library, The Potomac Towers, Hagerstown Fairgrounds, Uni - versity Plaza, and more! The City of Hagerstown is updating its Downtown Plan for future growth with many projects already underway. Now after many years of being vacant, the building is going up for auction! Hurley Real Estate & Auctions of Greencastle, PA has been asked to undertake this large scale event. Property showings for the building will be held on Saturdays January 8th and 15th from 12-2PM. Sealed bids for the property will be accepted through January 22, 2025 no later than 1PM. MAREJ
The Historic 1920s Neo-Georgian YMCA Building in Downtown Hagerstown, MD
Potential uses include: Residential, Commercial Offices, Mixed-Use, Light manufacturing & more. Ideal location with close proximity to the brand new Meritus Park, Barbara Ingram School for the Arts, The Maryland Theatre, Western MD Regional Library, Hagerstown Fairgrounds Park, University Plaza, The Potomac Towers, and more! Convenient to Interstate 70 & 81, Routes 40 & 11 & much more! Features include: grand entryway, clear span areas, conference & banquet rooms, gymnasiums, indoor track, swimming pools, theaters, racquetball courts, over 60 dorm rooms & more! The property has 165 feet frontage on N Potomac St and 230 feet frontage on W Church St. Grants for renovations may be available - contact the City Of Hagerstown Dept of Community & Economic Development. ENDLESS POSSIBILITIES AWAIT!!!!
MATTHEW HURLEY AU 003413L ● KALEB HURLEY AU006233 ● R. EUGENE HURLEY AU003793L ^E&KZ/E&K
10A — December 2024 — New Jersey — M id A tlantic Real Estate Journal
www.marej.com
N ew J ersey
AEBOV Industrial Real Estate Brokerage Shaping the Future: How 2023 redefined New Jersey cannabis real estate demand
N
in order to receive an annual license, 2023 yielded a much larger sample size of real estate transactions. We are happy to share some of the data from these transac- tions as well as more details on the 2023 conditional licenses, which may offer a glimpse into where demand is heading: • Retail: Of the 413 adult personal-use conditional can- nabis licenses approved in 2023, approximately 61% of these were class 5 retail li- censes - as it pertains to real estate, retail awardees require storefronts, shopping plazas,
or other properties suitable for or convertible to retail use. • Cultivation: Approxi- mately 20% of these licenses were for cultivation - gener- ally, cultivation licensees re- quire warehouses to accommo- date indoor growing however there have been some transac- tions for land and greenhouses as well. • Manufacturing: Roughly 18% of the conditional licenses issued were for manufacturing - manufacturing operators also require industrial properties, albeit the industrial properties utilized for manufacturing are
typically smaller with lower ceiling heights and less power service than their counter- parts utilized for cultivation. • Wholesale, Distribu - tion, and Delivery: Whole- sale, distribution, and delivery licenses each accounted for less than 1% of the conditional licenses issued in 2023. Retail Trends: • Over the period from 2022- 2023, the average NJ recre- ational dispensary lease was for 3,587 s/f, a decrease of ap- proximately 14% from the prior years’ average of 4,175 s/f. • The average lease rate in
2022-2023 was $26/SF/year. Value appeared to be closely correlated to the number of retail locations allowed by the township where the property was located, as opposed to any particular attributes of the real estate, such as traffic count, condition, etc. Specifically, in townships that allow sev- eral retail locations or have no limit on approvals altogether, the average rent was $22/SF/ year. By contrast, in townships that will only issue one retail approval - thereby ensuring that the license recipient will operate the only dispensary in the town - deals were inked at an average of $48/SF/year, over double the average rate for space in towns that allow multiple dispensaries. • Approximately 84% of dispensaries leased spaces with on-site parking over 2022-2023, marking a slight increase from prior years. Industrial Trends: • Contrary to retail deals, which were spread somewhat evenly throughout the state, cultivator and manufacturer deals for industrial properties were mostly located in the southern part of the state. A few possible reasons include the lower real estate acquisi- tion costs, lower labor and supply costs, and greater labor availability in those regions. Since operators will be selling product into a statewide mar- ket with fixed prices, there is logic to operating in a region of the state with lower operating costs and a larger labor pool. • Industrial rents for cul - tivation and manufacturing properties varied based on size, power service, and clear height. Rents averaged in the mid-teens psf and were trend- ing higher as of the writing of this report. The market for vi- able, existing warehouses that can accommodate cannabis as a use continues to be supply constrained. • Land sold for an average of $75K/acre. Generally, there was less demand for land than built facilities. This could be due to a number of reasons, in- cluding the lengthier timeline associated with developing a ground-up project as well as a challenging financing envi - ronment as most lenders still perceive both the cannabis use as well as development projects as higher risk. “Despite market challenges, continued on page 12A
EW JERSEY — 2023 marked an active growth year for the NJ
cannabis real estate mar- ket. While the number of condition- al licenses granted by the CRC, the state’s can- nabis agen-
Daniel Tropp
cy, was down from 910 in 2022 to 413 in 2023, the number of annual licenses issued soared over 800% year-over-year. As site control is a requirement
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M id A tlantic Real Estate Journal — New Jersey — December 2024 — 11A
www.marej.com
N ew J ersey
12.24
Cushman & Wakefield’s Tri-State Capital Markets closed in excess of $2.4 billion of oce, industrial, retail, land and multifamily transactions in the past 12 months. RECENT SUCCESSES & NEW DEALS
MARKETING
ALBANY METRO PORTFOLIO Albany, Clifton Park, Troy, NY 997 Units Only 15% of the units have been renovated, leaving large opportunity.
THE OFFICES AT GREENS FARMS Westport, CT 125,731 SF 77% leased leased to 10 tenants. 70% NOI growth by year 5. Minutes from vibrant downtown Westport.
101 MAIN STREET South Amboy, NJ 285,742 SF Recently completed warehouse with 40’ clear height, 2.5 acres excess parking, and one-turn access to NJ Turnpike Exit 11. 30-year PILOT.
Communities benefit from attractive long
term, fixed rate assumable debt.
SOLD
30 INDEPENDENCE BOULEVARD
FAIRMEADOWS INDUSTRIAL PORTFOLIO
EXIT 7A REDEVELOPMENT SITE Hamilton, NJ 170,800 SF 15.7-acre redevelopment site at the intersection of Route 130 & I-195. Zoned as-of-right for industrial.
Warren, NJ 207,000 SF
Fairfield, NJ 868,542 SF
Recent renovations throughout the building. Located
17 building portfolio, 86% occupied by 24+ tenants. 40% below market rent.
directly o I-78 in a 5-building oce park. Walkable amenities.
CAPITAL MARKETS GROUP
ANDREW MERIN andrew.merin@cushwake.com DAVID BERNHAUT david.bernhaut@cushwake.com GARY GABRIEL gary.gabriel@cushwake.com NIKO NICOLAOU niko.nicolaou@cushwake.com KYLE SCHMIDT kyle.schmidt@cushwake.com FRANK DITOMMASO frank.ditommaso@cushwake.com ANDREW SCHWARTZ andrew.schwartz@cushwake.com DAVID OROPEZA david.oropeza@cushwake.com
DAVID JARVIS david.m.jarvis@cushwake.com RYAN DOWD ryan.dowd@cushwake.com RYAN LARKIN ryan.larkin@cushwake.com SETH ZUIDEMA seth.zuidema@cushwake.com BILL BAUNACH bill.baunach@cushwake.com MAX HELFMAN max.helfman@cushwake.com JORDAN SOBEL jordan.sobel@cushwake.com ANDRÉ BALTHAZARD andre.balthazard@cushwake.com
PETER WELCH peter.welch@cushwake.com JEAN-PIERRE HOHL jeanpierre.hohl@cushwake.com MAIA SIRABIAN maia.sirabian@cushwake.com MICHAEL GUERRA michael.guerra@cushwake.com DANIEL MASSRY daniel.massry@cushwake.com SAMANTHA MILLER samantha.a.miller@cushwake.com DAVID BETESH david.betesh@cushwake.com RYAN KELLY ryan.kelly1@cushwake.com
DAN BOTTIGLIERI daniel.bottiglieri@cushwake.com
CUSHMAN & WAKEFIELD, INC. CAPITAL MARKETS GROUP One Meadowlands Plaza, 7th Floor East Rutherford, NJ 07073 T / +1 201 935 4000 E / investment.sales@cushwake.com
12A — December 2024 — New Jersey — M id A tlantic Real Estate Journal
www.marej.com
N ew J ersey
S.V.P. Lanni arranges sale of 10 luxury units in Ocean County for record price per unit Kislak sells Village Apartments in Point Pleasant, NJ for $3.5 Million
OINT PLEASANT, NJ — The Kislak Company, Inc. an- nounced the recent sale of Village Apartments, a 10-unit luxury multi- family prop- erty at 1005 Trenton Av- enue in Point Pleasant, Ocean County, New Jersey, for $3,500,000. Kislak marketed the prop- erty on an exclusive basis with senior vice president Daniel P Daniel Lanni
all of Ocean County according to data available from CoStar. Lanni commented, “It was a pleasure to sell this property again after selling it in 2017. These are large, condo quality apartments in a terrific location less than two miles from the ocean. We achieved a record price per unit at an aggressive 5.1% cap rate. Helping the buyer to close quickly and effi - ciently, Magyar Bank financed the transaction.” Built in 2002, the 10,000 s/f brick, two-story complex consists of 10 two-bedroom, two bath apartments with in-
dividual washers and dryers, spacious open floor plans, in - dividual balconies and porches and ample onsite parking. Fully occupied at the time of sale, with below market rents and no rent control, this property was attractive as a potential a condo conversion opportunity. Point Pleasant is popular Jersey Shore destination in northern Ocean County situated just south of the Manasquan River. It has a good walkability score and is serviced by nearby the New Jersey Coast Line commuter rail along with two bus lines. Daniel Lanni joined Kislak in 2010 and is consistently among the firm’s leading producers. He specializes in the sale of multifamily and other invest- ment properties in central New Jersey with a particular focus along the Jersey Shore. Mr. Lanni was the recipient of the firm’s 2011 Rookie of the Year Award and was promoted to a senior vice president in 2019. He has also been recognized by the Mid Atlantic Real Estate Journal as one of its 40 Under 40 in commercial real estate. About The Kislak Co., Inc. The Kislak Company, Inc., which is headquartered in Woodbridge, New Jersey, is a leading commercial real estate brokerage firm consistently recognized for its investment sales success. Established in 1906, Kislak’s market leader- ship position and longevity are due to its ability to offer clients a personalized, hands- on approach, coupled with the unrivaled expertise of its long-tenured team of profes- sionals. Kislak’s prestigious client base includes individual investors and owners, partner- ships, financial institutions, and REITs. The firm’s profes - sionals provide comprehensive market coverage through- out New Jersey, New York, Pennsylvania, Delaware, and Florida. MAREJ including a limited supply of viable properties and ap- prehensive commercial land- lords, we are fortunate to have a wonderful roster of clients who are both capable and tenacious enough to close these complicated deals,” said Daniel Tropp ,founder of AEBOV. MAREJ continued from page 10A AEBOV Industrial Real Estate . . .
1005 Trenton Avenue
Lanni handling the assignment on behalf of the seller WSJ II, LLC, and he procured the pur- chaser, L State Realty, LLC.”
At $350,000 per unit, the price represents the highest price achieved for a multifamily property in Point Pleasant and
EXCLUSIVE PROPERTIES FOR SALE
Mansfield, NJ 3.44 Acres with Approvals
Union City, NJ 1.54 AC Land for Redevelopment
Somerville, NJ 45,000 SF Max Levinston ext 308
Matt Weilheimer ext 253 Tom Scatuorchio ext 255
Matt Weilheimer ext 253 Tom Scatuorchio ext 255
Union City, NJ 13 Residential Units Robert Squires ext 287
West Orange, NJ 6 Units + 3 Retail plus 11 Approved Units Tom Scatuorchio ext 255
Freehold, NJ 13,674 SF Retail Daniel Lanni ext 248
The Kislak Company, Inc. | kislakrealty.com | 732 750 3000
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