- DC
Highest Concentration of sold properties span Northern and Central NJ Gebroe-Hammer Associates marks mid-year with $1.015 billion in sales
ISSUE HIGHLIGHTS Volume 28 Issue 13 July 15 - 28, 2016 DelMarva• DC 11-16A Southern NJ 5-11B Northeastern PA 5-8C The Impact Of Driverless Cars On Real Estate
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apex that has yet to peak in terms of asking rents, occupan- cies and per-unit pricing,” said Ken Uranowitz , Gebroe-Ham- mer president. “Since the be- ginning of ‘time’ – and through many an economic downturn – apartment buildings have al- ways proven to be the most sta- ble real estate asset class versus office, retail and industrial properties. The Great Recession was a watershed event with lasting impact. It profoundly shifted the dynamics of single- family residential ownership to apartment-rental living in tandemwith an ever-increasing tenant pool of millennials and baby-boomer retirees.” According to Uranowitz, ask- ing rents will continue to climb through year end and extend over the course of the next two years. In turn, he expects valuations to mirror this trend, notwithstanding eventual inter- est-rate hikes. “Right now, the
main level shared spaces is the transformative installa- tion of motion-activated media displays created by ESI Design. The large-scale, reactive media on lobby walls and corridor por- tals create a better sense of con- nectivity in the first floor space. The diffused LED wall displays are activated by passersby via an infrared camera system. Three content modes – Seasons, Color Play and Cityscape – of- fer a selection of scenes which can be programmed with vary- ing durations and sequences, ensuring tenants never see the same scene even if they arrive and leave at the same time every day. ESI also rede- signed the Mary Church Terrell Memorial, showcasing Terrell Place’s status as a designated stop on the city’s “Civil War to Civil Rights” heritage trail. The tribute to the building’s namesake features a prominent exterior marker and main lobby placard that both provide his- toric context and photos of the sales arranged in Q1 and Q2, Hudson and Essex counties recorded the most transactions, totaling 25, while Middlesex and Union counties led the way with the most number of units sold, topping off at more than 3,100. The balance of the Q1 and Q2 sales/units were in the multi-family strongholds of Bergen, Passaic, Morris, Monmouth and Ocean counties. The municipalities through- out these counties boast some of the highest population den- sities in the nation. They also include a high concentration of existing and under-con- struction multi-family product that is attracting – and be- ing absorbed by – a dynamic, young professional tenant demographic. Properties in emerging submarkets, such as Warren, Gloucester and Camden counties, rounded out Gebroe-Hammer’s latest six- month activity. n continued on page 18A
economy is holding steady, al- beit markedly soft as compared to prior years, and job creation is weak as of the latest reports,” said Uranowitz, who has been with Gebroe-Hammer since its inception in 1975. “From busi- nesses to the workforce demo- graphic, everyone is taking a wait-and-see-approach when it comes to economic and jobs growth, especially nowwith the unexpected Brexit vote and its unknown long-term impact on our economy. This is only feed- ing the tenant base pipeline as well as opportunities for gen- trification/property reposition- ing in submarkets undergoing redevelopment.” The majority of Gebroe-Ham- mer’s 2016 urban and subur- ban multi-family sales have spanned the 16 geographic submarket concentrations that comprise Northern and Central New Jersey, home to more than 397,000 total units. Of the 67
IVINGSTON, NJ — As multi-family property performance continues
its positive climb at mid- year – main- taining a run of gains that exceed eight- plus quarters and counting – the broker- age pro f es -
Ken Uranowitz
sionals at Gebroe-Hammer Associates report never-be- fore-seen trading velocity that is showing no immediate signs of deterioration. The 40-year- old Livingston based firm has surpassed the $1.015 billion sales threshold in the first six months of the year, notably closing 67 deals involving more than 6,600 units, a company milestone. “Multi-family investments and apartment-rental perfor- mance have reached a historic
Wes Guckert, PTP The Traffic Group 12A
For speaking and sponsorship information, please contact: Linda Christman at 781-871-3456 or lchristman@marejournal.com UPCOMING CONFERENCES July 22, 2016 Delaware Multifamily Summit September 8, 2016 Pittsburgh Commercial Real Estate Forecast Summit September 15, 2016 3rd Annual NJ Apartment/ Multifamily Summit
Beacon completes first phase of a $20 million capital improvement campaign
WASHINGTON, DC — Beacon Capital Partners , a leading office investor and manager, announced it has completed the first phase of a $20 million capital improve- ment campaign at Terrell Place, a trophy property in Washington, DC that anchors the corner of 7th and F Streets Northwest in the heart of
Directory
Terrell Place interior rendering ©jeffwolfram.com
Financial Digest................................................5-10A DelMarVa • DC.................................................11-16A New Jersey................................................. Section B Pennsylvania.............................................. Section C
Penn Quarter. Terrell Place is a 476,000 s/f office and re- tail complex. The property is comprised of three connected components: the historic for- mer Hecht’s Department Store, where Mary Church Terrell led a successful protest regarding its segregated dining policy in 1950; a nine-story South Wing, incorporating four historic fa- cades; and a connected 11-story office tower fronting F Street. The project consists of 441,000 s/f of trophy office
space and 35,000 s/f of retail space. With this first phase of the renovation, new street-fac- ing retail has been integrated into the F Street lobby pro- viding activated collaboration areas for tenants and guests. Additionally, the Hecht’s tower lobby and the gallery corridor with its 11-story naturally-lit atrium, has all been architec- turally enhanced to encourage gathering and stimulate co- working. Extending throughout the
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Introducing Terrell Place. . .
Beacon Capital Partners introduces the newly renovat- ed Terrell Place, a 467,000 SF trophy property at 575 7th Street NW in Washington DC. Now a distinctive workplace transformed by a mes- merizing nature scape, the first phase of a $20m capital improvement program underscores Beacon’s commit- ment to creating a vibrant, modern space while respect- ing its elegant architecture and historic significance. A legendary address, perfectly situated at the corner of culture and commerce. Set in the heart of the Penn Quarter, at the corner of 7th and F Streets Northwest, Terrell Place is one of Washington DC’s most legendary properties offering office and retail space.
Photo credit: © JeffWolfram.com
Photo credit: © JeffWolfram.com
For more information, contact Karen Gentry, Beacon Capital Partners: P: 703 894 6253 | E: kgentry@beaconcapital.com For leasing information, contact Trip Howell, JLL: P: 202 719 5735 | E: Walter.Howell@am.jll.com ©2016 Beacon Capital Partners, LLC. All rights reserved. Beacon Capital Partners and Distinctly DC are registered trademarks of Beacon Capital Partners, LLC.
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MAREJ A dvertising D irectory Barley Snyder...........................................................3C Beacon Capital Partners.......................................IC-A Breckstone Architecture. .......................................17A Bussel Realty Corp...................................................1B Capstan Tax Strategies..........................................18B Cooper Horowitz.......................................................7A CREW Lehigh Valley. .......................................16-17C CREW NJ................................................................21B CREW Philadelphia. ..............................................14C Cushman & Wakefield. .........................................IC-B Deerwood Real Estate Capital.................................6A Earth Engineering, Inc.. ..........................................2C Fine Art Resources...................................................1C Gebroe-Hammer Associates.....................................1A Gebroe-Hammer.....................................................13B Harvey, Hanna & Associates, Inc..........................15A Heller Industrial Parks..........................................15B Hinerfeld Commercial Real Estate..........................7C Hutchinson Mechanical Services...........................10B IFMA NJ.................................................................20B Investors Realty......................................................13A Kaplin | Stewart......................................................3A Kislak Co.................................................................12B Marcus & Millichap..................................................3A Markward Group......................................................8C MCEDC...................................................................16B Mericle...................................................................BC-C Meridian Capital Group...........................................3B NAI CIR. ...................................................................9C NAI Mertz...............................................................10C NAI Summit..............................................................2C Penn’s Northeast......................................................6C Poskanzer Skott Architects......................................4B PREC.......................................................................15C Provident Bank.....................................................BC-A Redwood Realty Advisors.........................................2B Regal Bank..............................................................10A RT Environmental Services.....................................4C SEBCO Laundry Systems........................................2B SNJ AI....................................................................8-9B TDK Commercial Advisors. .....................................4A The Berger Organization. ....................................BC-B The Traffic Group...................................................12A Traiman Real Estate Auction..................................2A U.S. Realty Capital.................................................14A Urban Land Institute.............................................17B WCRE........................................................................7B
Mid Atlantic R eal E state J ournal Publisher ............................................................................ Linda Christman Publisher ............................................................................... Joe Christman Associate Publisher ................................................................ Steve Kelley Associate Publisher .............................................................Alissa Aronson Associate Publisher ..........................................................Barbara Holyoke Associate Publisher ..............................................................Eric Ballenger Associate Publisher ...................................................................Kim Brunet Senior Editor/Graphic Artist .................................................Karen Vachon Production Assistant/Graphic Artist ...........................................Julie King Office Manager .................................................................... Joanne Gavaza Contributing Colomnist ................................................... Nicholas Malagisi Mid Atlantic R eal E state J ournal — Published Semi-Monthly Periodicals postage paid at Rockland, Massachusetts and additional mailing offices Postmaster send address change to: Mid Atlantic Real Estate Journal, 312 Market St. Rockland, MA 02370 USPS #22-358 | Vol. 28 Issue 12 Subscription rates: $99 - one year, $148 - two years, $4 - single copy REPORT AN ERROR IMMEDIATELY MARE Journal will not be responsible for more than one incorrect insertion Toll-Free: (800) 584-1062 | MA: (781) 871-5298 | Fax: (781) 871-5299 www.marejournal.com The views expressed by contributing columnists are not necessarily representative of the Mid Atlantic Real Estate Journal
Mid Atlantic Real Estate Journal
Nicholas Malagisi
Self Storage Industry Review
S elf storage fared better than every other com- mercial real estate sector during this past recession. However, we learned that the sector was not "recession-proof”, but more "recession-resistant". After two years of losses (9 con- secutive quarters), the four pub- licly traded REITS turned the corner and now have reported five consecutive positive years’ performance. Occupancies are up; concessions are down; and rental rates are finally climb- ing back to pre-recession levels. REITS, in general, have out- performed the S & P and Dow Jones Industrials. The self storage industry has finally begun to consolidate as the number of new construction starts diminished for five con- secutive years from their peak in 2006. The industry literally doubled in size from one billion to two billion square feet from 1995 to 2006. There will be 600- 800 new construction starts in 2016 and probably 1,000 starts in 2017. The top twenty opera- tors in the USA control only 15% of the total market, but have a larger share within the top 50 markets. But we may see that change as the REITS, flush with investment cash, acquire and increase their market share in
select markets. Similarly, other new sources of institutional monies have been watching the sector and have concluded that self storage returns are as de- pendable, or even more secure, than the other traditional com- mercial real estate asset classes. These new funds/buyers are very competitive with the RE- ITS and have forced Cap Rates down to the mid-5 % range for stabilized, class "A"-good quality facilities located in the top 10 markets. Cap rates in secondary & tertiary markets remain in the 6-8% range depending upon the age of the facility; location of property and its demographics. With regard to financing, self storage continues to en- joy the lowest default rate of any other sector in the CMBS market. While banks and life insurance companies are more conservative in their underwrit- ing than they were pre-reces- sion, other sources of financing have emerged, including credit
unions with an expected 30-35% equity contribution, SBA financ- ing, andmezzanine financing for short term situations. As we look ahead to the re- mainder 2016, we should see industry performance continue at its high level & consolidation from the larger operators, such as the $1.2B acquisition of Stra- tegic Storage Trust by Extra Space; the $788M acquisition of Simply Self Storage by Brookh- ill, and the current $1.3B acqui- sition of Life Storage by Uncle Bob’s Self Storage. In addition, there will be more certificate of occupancy type deals coming through the development pipe- line as our industry has finally created a “merchant builder” class of developers providing true class A assets. Nicholas J. Malagisi serves as national director of Self- Storage and Senior Advisor for SVN, specializing in the purchase and sale of self- storage properties. n
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M id A tlantic R eal E state J ournal In the Estate and Trusts Group Taylor A. Smith, Esq. joins Kaplin Stewart as associate
Leading the Real Estate Investment Market Contact us today to access the largest inventory of properties.
B LUE BELL, PA — T a y - l o r
Trusts group. Her practice focuses on all stages of estate planning and estate admin- istration. Smith’s practice also in- cludes general tax prac- tice. Prior to joining Kap- lin Stewart, Smith was anassociate in the Trusts and Estates department at Dilworth Paxson, LLP in
Center City Philadelphia. She earned her Juris Doc- torate from Temple Uni- versity and her Bachelors of Science in Mathematics and Bachelors of Arts in Po- litical Science at Villanova University. Smith is licensed to prac- tice law in both Pennsylva- nia and New Jersey. n
Smith, Es- quire has joined Kap- lin Stewart in Blue Bell as an asso- ciate in the Estate and
J.D. Parker Manhattan
Brian Hosey New Jersey (201) 582-1000 Bryn Merrey Washington, D.C. (202) 536-3700
(212) 430-5100 Brenton Baskin Philadelphia (215) 531-7000
GHP Office Realty acquires 375 Executive Blvd., an 81,500 s/f flex bldg. in Elmsford, NY Taylor Smith
Offices Throughout the U.S. and Canada
www.MarcusMillichap.com
ELMSFORD, NY — GHP Office Realty, LLC an- nounced its acquisition of the 81,500 s/f property con- sisting of 75,000 s/f of 16’ high, 40-foot column spac- ing warehouse space with four loading docks and two drive-in doors and 6,500 s/f of office space. The building is situated in the 88-acre Cross Westchester Execu- tive Park. The GHP acquisition team was led by AndrewGreens- pan , principal of GHP and Jamie Schwartz, executive vice president. Greenspan said, “This is the second flex building we have acquired in the last two years. We were
Mid Atlantic R EAl E stAtE J ouRnAl ’ s A nnuAl C oMMERCiAl B RokERAgE D iRECtoRy
375 Executive Blvd.
attracted to the deal because there is a dearth of flex space in Westchester County and especially on the west side of the County. The County of Westchester will lease back 23,000 s/f from us leaving
58,500 s/f available for lease to warehouse, flex, medical, laboratory, technology and/ or office users looking to be in the Elmsford area close to I-287, I-87 and The Sprain Brook Parkway.” n
To run a FREE LISTING of your commercial brokers fill out coupon below Don't Miss This Opportunity! • Deadline: July 20 • MAREJ' s A nnuAl C oMMERCiAl B RokERAgE D iRECtoRy ❏ Please have an advertising rep. contact me about your special rates. ❏ C heck here if you’d like a special listing (includes logo and border) - $50 - double block $100 Company Name: __________________________ Address: ________________________________ ________________________________________ Telephone/Fax: ___________________________ ________________________________________ ________________________________________ ________________________________________ Linda Christman, Mid Atlantic Real Estate Journal 781-871-3456 Fax: 781-871-5299 or Email: lchristman@marejournal.com Commercial Brokers: (Free Listing: Top 3 brokers)
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M id A tlantic R eal E state J ournal Growing regional firm continues to gain market share TDK Commercial Advisors completes over $3.4 million in regional transactions P HILADELPHIA, PA — Thomas Kramer , president of TDK Com-
Center, Island and Batram Avenues, TDKCA represented Core Realty in two new leases. XTL, Inc. a regional logistic company leased 1,500 s/f for a long term lease at 3751 Island Ave. Thomas Kramer remarked that “these two transactions take the property to near 89% leased, and we expect to be 100% occupied by Q1 2017”. The tenant was represented by Colliers International . In the second transaction, CMC Engineering (“CMC”) leased 1,000 s/f and will occupy the space August 1. TDKCA was the sole broker in the CMC
transaction. The landlord of 198 Allen- dale Rd. was represented by TDKCA in the completion of a lease with Cunningham Piano Company for nearly 6,000 s/f. The retail location will be used to sell various types of pianos. The long term lease is valued at over $2 million. Thomas Kramer said, “This transac- tion kicks off the revitalization of this well located asset, in the heart of King of Prussia. Building renovations are well into the planning stage, and we are excited to welcome Cunningham Piano as our an- chor retail tenant. Berkshire
Hathaway Home Services represented the tenant. TDKCA also represented two long term clients with the acquisition of new office space. Console Law Offices was represented by TDKCA in cooperation with Sky Line Real Estate in a long term lease for 3,000 s/f. Console will be relocating to 210 Marter Avenue in Moorestown, NJ. Financial terms of the lease were not released. In coordination with JLL , TDKCA also represented Mintzer Sarowtiz Zeris Ledva & Meyers in the acquisition of over 3,500 s/f in Towson, MD. The firm will be relocat- ing to 810 Gleneagles Court, Towson, MD. Financial terms of the transactions were not released. TDKCA is also pleased to announce that they have been named the marketing and leasing agent for a number of properties. The firm is leas- ing and marketing 1 Wind- ing Drive, newly named the Monroe Executive Campus, in Philadelphia PA. The 71,000 s/f property is well located just outside of Bala Cynwyd and minutes to the Schuylkill Expressway, PA Tpke., and 676. Center City Philadelphia is only 10 minutes away. The property is undergo- ing a major renovation and is steadily leasing space. It is part of the Presidential City apartment complex which is undergoing a multi-million dollar renovation. TDKCA was also named the exclusive marketing agent for 1 Chelsea Parkway in Booth- wyn PA. The flex property is owned by SJS Realty and has spaces from 3,000 s/f to 14,000 s/f. TDKCA has been appointed the marketing and leasing agent also for the new Protecs Innovation Centers. These properties consist of two lo- cations. 5100 Campus Dr. in Plymouth Meeting and 3700 Horizon Drive in King of Prus- sia, PA. Both properties offer spaces from 1,500 s/f and have office, lab, and R&D space. These are unique buildings in that they allow lab and office users to collaborate with each other, or lease standalone spaces. TDKCA was also named the exclusive sales agent for 901 East 8th Avenue (the Cedar Run Corporate Center) in King of Prussia, PA. This 59,000 s/f continued on page 18A
in leasing over 4,000 s/f to two new tenants. In the first transaction WFGD leased nearly 2,000 s/f for their new headquarters. WFGD is a regional marketing and brand- ing company and will occupy the space as of September 2016. In the second transac- tion TDKCA represented the landlord in leasing 2,000 s/f to Frontier BPM, a software company, moving in to the city from Blue Bell, PA. Jim Savard of James E. Savard Real Estate Consulting represented the tenant in the long term transaction. At the Gateway Business
mercial Ad- visors (TD- KCA ) h a s completed a numb e r o f transactions totaling over $3.4 million on behalf of a national cli- ent base as well as several new key listings. At 718 Arch St., The Cast Iron Building, TDKCA repre- sented the owner of the build- ing AMC Delancey Group Thomas Kramer
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2200 Renaissance Boulevard, Suite 210, King of Prussia, PA 19406
F inancial D igest
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Procida Funding reaches $300m+ mark since 2011
Expands relationship with Capital One Liberty SBF secures $75m in B Round Capital Raise
100 miles of New York City, has funded a variety of com- mercial, retail and residential projects. Recent transactions in- clude: • A $68.5 million construc- tion loan to renew construc- tion on the long-dormant Gulls Cove II Condo and Retail project in Jersey City. • A $7.16 million construc- tion loan for the refinancing, renovation and conversion of a vacant building into market-rate luxury loft con- dominiums with a brewery on the ground floor in Beacon, NY. • A $16.2 million construc- tion loan for the refinancing of the Mural Arts Loft in the North Broad Street Corridor, one of five projects that Proci- da is currently supporting as the neighborhood reemerges as a beacon of commerce and entertainment. • A $34.75 million construc- tion loan for the conversion of the Divine Lorraine Hotel into luxury apartment units with ground floor retail, also lo- cated in Philadelphia’s North Broad Street Corridor that the 100 Mile Fund is sup- porting with the intension of being the impetus to continue the neighborhood’s rebirth as a beacon of commerce and entertainment. • A $3.365 millionmortgage bridge loan to Tower Real Es- tate, LLC for a medical office building in Hackensack, NJ. n
ENGLEWOOD CLIFFS, NJ — Recent construction loans in Jersey City, Hack- ensack and Philadelphia by Procida F u n d i n g ’ s 1 0 0 M i l e Fund have e l e v a t e d its lending originations to more than $300 million since 2011. The 100 Mile Fund has provided 74 loans of which 34 have been repaid total- ing more than $152 million, earning more than 14% for its investors. “We do not chase trends – we focus on developers of low- risk projects in sub-markets like Nyack, NY or Paterson, NJ. Many lenders do not un- derstand that the price basis and stability in those markets reduces risk,” said William Procida , president of Procida Funding & Advisors, LLC. The 100 Mile Fund, a mid- dle-market real estate invest- ment vehicle focused on devel- opment and bridge loans, has averaged returns of 13% since being established in 2011. The fund’s typical borrower refinances with conventional long-term debt an average of 14 months after originating a loan with Procida, creating an exceptional velocity that rewards the Fund’s investors. The 100 Mile Fund exclu- sively funds projects within William Procida
N
Mission Capital’s unparalleled ability to arrange favorable loans for our clients in every market across the country,” Cohen said. “Through diligent outreach to our wide range of lender contacts, we were able to arrange an extremely favorable loan for our client, enabling them to capitalize on Center City Philadelphia’s significant foot traffic and in- comparable culture.” The area’s high concentra- tion of office workers, tourists and local residents has made it one of the city’s most sought- after retail locations, leading to cial mortgage debt predicted to mature over the next three years, exponentially expand- ing the market for 504 loans. Liberty SBF plans to capture a significant volume of the refinance wave through its National First Lien SBA 504 Wholesale Program. "Liberty SBF expects to origi- nate over $200MM in 504 loans in the next 12 months on asset types that range from industri- al and self-storage facilities to hotels among others," said Alex Cohen , CEO, Liberty SBF. "By increasing our already sub- stantial nationwide network we will help serve more small businesses seeking commercial property financing." By revitalizing and trans- forming the 504 market, Liber-
skyrocketing retail rents. “The borrower plans to im- plement capital improvements at the properties and increase cash flow through aggressive lease-up and increasing retail rents to market rates,” said Hirt. “We received offers from a wide range of lenders, includ- ing banks and debt funds that were interested in investing in these prime retail proper- ties. Ultimately, we closed on an excellent bank loan with a great rate, providing the spon- sor with the necessary capital to unlock the full potential of these assets.” n "We're excited to invest di- rectly in a platform that is revolutionizing the commer- cial real estate lending busi- ness,” said Elie Brende r, chief investment officer, Exigent Alternative Capital. “Liberty SBF's lending focus and ex- isting portfolio presents a compelling opportunity that is consistent with our investment strategy.” n “This was a unique ex- ecution as the hotel suffered from a small setback that consequently impaired the hotel’s performance. This also came at a time when the owners were looking to stra- tegically position the hotel due to certain market condi- tions and needed additional capital on top of retiring their existing debt to implement a PIP,” said Williams. n ty SBF is filling an exceedingly large void in secondary market lending with its National First Lien SBA 504 Wholesale Pro- gram. Liberty SBF will partner with approved banks, non-bank lenders and other SBA loan intermediaries to originate 504 loans across the country and can pay up to 4 points of premium to its partners.
EWYORK, NY — Lib- erty SBF has received $75MM in its Series
B round of funding led by Exigent Capital and M a i n l i n e Investment Pa r t n e r s , among other pr i vat e in- ve s tment s .
Alex Cohen
In conjunction with the equity raise, Liberty SBF has expand- ed credit facilities with Capital One Bank . Congress recently passed legislation to permanently re- instate the SBA 504 Refinance Program. This program will help to refinance some of the almost $1 trillion in commer- PHILADELPHIA, PA — Mission Capital Advisors ’ Debt & Equity Finance team arranged $37.2 million in non-recourse financing for a portfolio of retail properties in Center City Philadelphia’s premier retail district. The Mission Capital team of Jason Cohen, Ari Hirt and Jamie Matheny arranged the loan on behalf of a major local in- vestor. “Our execution of this trans- action in Philadelphia — a city that is experiencing an explosion of real estate in- vestment — is a testament to ESSINGTON, PA — Me- ridian Capital Group , America’s most active debt broker, arranged $7 million in permanent financing for the refinance of the Wynd- ham Garden Philadelphia Airport hotel located in Es- sington. The five-year loan, provid- ed by a balance sheet lender, features a competitive rate of below 5.00% and one year of interest-only payments. This transaction was negotiated by Meridian managing direc-
Mission Capital procures $37.2 million loan for Philadelphia retail portfolio
WASHINGTON, DC — Eastern Union Funding (EasternUnion) has arranged nearly $4.3 million in financ- ing for The Jocelyn Group to acquire 1515 Rhode Island Ave., NE, where it will develop The Violet, a modern, 20-unit luxury rental apartment build- ing with underground parking. Minutes from downtown and well-served by metro and bus lines, The Violet’s two-bedroom and two-bathroom apartments will feature high-end finishes, including hardwood floors, granite counter tops and stain- less steel appliances. Rents for Eastern Union organizes $4.3 million in financing the 1,100 s/f units will start at $2,400 per month. Most resi- dents will have private outdoor space and all will have access to the rooftop deck resplendent with native plantings. According to Eastern Union senior loan consultant David Merkin , the 10-year loan for the shovel-ready site reflects 80 percent of the acquisition cost and includes construction financing. Amortized over 30 years, the debt, which was secured through Presidential Bank, comes with a five-year fixed rate and 18 months of interest-only payments. n
Meridian Capital Group arranges $7 million tor, Brian Flax , associate, Joel Chetner , and associate, Beau Williams , who are all based in the Company’s NYC headquarters. space. Hotel guests also have access to free parking and an airport shuttle.
The 308-room property, located at 45 Industrial High- way, is conveniently located just three miles from the Philadelphia International Airport and 12 miles from downtown Philadelphia. The hotel features a restaurant and lounge, outdoor pool, fitness center, business cen- ter and 6,500 s/f of meeting
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L Horizon Square Apartments, 254-unit apt. complex M&T Realty provides $26m in acquisition financing
AUREL, MD — M&T Realty Capital Cor- poration has closed a $25.956 million Freddie Mac loan for the acquisition of Horizon Square Apartments, a 254-unit apartment complex located in Laurel. Horizon Square consists of 1-, 2- and 3-bedroom apart- ment homes, with 1-bedroom homes accounting for 53 per- cent of the total. Community amenities include a fitness room, clubroom, swimming pool and playground. The transaction was led by managing director Tim Wel- don of M&T Realty Capital
Horizon Square Apartments
Corporation’s Washington, D.C. office for borrower ROSS Companies. ROSS, a leader in multifamily acquisitions, property management and renovation in the Mid-Atlantic region, plans to implement im- provements to the community. The upgrades will include new carpet in the hallways, paint, an LED lighting retrofit, new glass storefronts at all entries and new windows. “With Baltimore 20 miles to the northeast and Wash- ington, D.C., 20 miles to the southwest, the value of Hori- zon Square’s location speaks for itself,” said Scott Ross, president of ROSS Develop- ment & Investment, an af- filiate of ROSS Companies. “We believe our upgrades will make Horizon Square a key location for those who com- mute to either city, as well as those who are rooted in the Laurel area. We’re excited to get started and to create sus- tainable value.” n Andrew Ray Wolfe joins Wolfe & Co. Realtors CARLISLE, PA — Andrew Ray Wolfe has joined Wolfe &Company Realtors in Car- lisle and will head its newly formed Appraisal Division. Having recently obtained his Certified General Appraiser License in the Commonwealth of PA, he will be providing commercial, industrial and residential appraisal reports to all Counties within the South Central Pennsylvania Region. Wolfe recently completed a three and a half year ap- praisal apprenticeship with RSR Appraisers and Analysts in Lemoyne. n
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104,000 SF Office Refinance
Philadelphia, PA Fort Washington, PA 70% LTV, 75% LTC, 18 Months, 4.0% 75% LTV, 10/30, 4.98%, 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 75 East Butler Avenue • Ambler, PA 19002 • 610-456-9644 • bgreen@realpropertycapital.com
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$23,135,000
MECHANICS SAVINGS BANK BUILDING 944 MARKET STREET SAN FRANCISCO, CA An 8 story office building containing 47,318 square feet The undersigned arranged the above acquisition financing
622 Third Avenue New York, NY 10017 (212) 986-8400 Fax: (212) 983-0512 www.cooper-horowitz.com
Real Estate Financing
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By Bobby Young, Principal Commercial Capital Group USDA B&I Loan Program for R/E Financing
p r o g r am s for financ- ing owner- o c c u p i e d real estate. On e t h a t allows busi- ness owners to purchase property at M
ost people are at l east somewhat aware of the SBA
that gets much less fan-fare, but is very useful. Unlike the SBA, it can also be utilized
United States by providing lenders with a percentage loan guarantee against the
a loan it may otherwise de- cline. To take advantage of the program, the address of
the underlying property. The borrower can be a for-profit or nonprofit organization, public company, individual or federally recognized tribe. There is no minimum loan amount, though many lend- ers tend to not go below $200,000 and also no restric- tion on maximum amount, however many lenders will put in place their own caps. Typically, this is $10MM, with some lenders going up to $25MM+. The percent- age guarantee by the USDA is tiered based on loan size ranging from 60% to 80%. Additionally, most lend- ers require just 10% equity from the borrower towards the purchase. The loan is required to be fully secured based on sound loan-to-value policy established by the lender. Regarding loan term and amortization, the B&I pro- gram goes up to 30 years fully amortizing. It can be a fixed or variable rate, or com- bination of the two. Interest rate is set by the lender and tend to be close to SBA rates. Another key benefit is that this can be used to refinance an existing real estate loan, both conventional and SBA. With the growing utilization of SBA lending in recent years, many real estate own- ers run into an issue when wanting to refinance their building. It can be done in certain circumstances via another SBA loan, but more often times requires con- ventional financing which is more difficult to qualify for. The USDA B&I program is a welcome option to the mix. With any loan it is impor- tant to understand the up front and recurring costs. The B&I program has an initial 3% fee of the loan amount, which can be rolled into the loan. In addition, there is an annual percent- age fee based on the loan balance; which currently is 0.5%. This fee is set prior to closing and will not change through the life of the loan. Knowing all of the options available is important to the process of achieving your goals. Where and when ap- plicable, the B&I Program could be right for you. Bobby Young is CEO of Principal Commercial Capital Group. n
The B&I Loan is designed to increase access to capital in rural areas throughout the United States by providing lenders with a percentage loan guarantee against the funded loan amount.
Bobby Young
to purchase investment real estate. It is called the USDA B&I Loan Guarantee. The B&I Loan is designed to increase access to capital in rural areas throughout the
funded loan amount. Its means is to not only support the borrower, but the com- munity at large. By provid- ing a guarantee, the lender is more open to approving
the real estate must be in a town with total population less than 50,000 residents. This is beneficial as the bor- rower itself is not required to be at this location, simply
longer terms and amorti- zations than conventional financing, along with less equity injection. However, there is a similar program
Real Estate Journal — Financial Digest — July 15 - 28, 2016 — 9A
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G.S. Wilcox &Co. arranges $24 million first mortgage
Capital One Healthcare’s McMahon originates transactions Capital One closes $28m loan for acquisition of portfolio R eastern half of the United States. tra buildings will make an outstanding addition to the Charter portfolio.”
OCKLE I GH , NJ — Capital One has closed a $28 million loan to support the acquisi- tion of a medical office build- ing portfolio consisting of a 139,000 s/f laboratory building and a 68,000 s/f office build- ing located in Rockleigh. The purchaser, Charter Realty Group . Vice president Jim McMahon of Capital One Healthcare originated the transactions. The buildings are leased to Spectra Laboratories. The site serves as Spectra’s mission- critical testing facility for the
“We are pleased to support Charter in the acquisition of this desirable portfolio of re- cently modernized testing and laboratory facilities in a prime Bergen County location,” said Erik Tellefson, Capital One Healthcare managing director. “We benefited greatly from Capital One Healthcare’s knowledge of the medical of- fice building market and its expertise in structuring the financing for this acquisition,” said Arnold Porath, Charter’s founder and CEO. “The Spec-
Capital One Healthcare is a provider of financial services to the industry with over $11 billion in total outstanding balances. Customers across healthcare sectors—including senior housing, healthcare services, pharmaceuticals, medical devices, healthcare IT and medical offices—rely on Capital One Healthcare to finance acquisitions, refinance existing debt, support working capital needs and fund growth initiatives. n
S. Wilcox &Co.’s correspondent lenders. The three hotels in the portfolio are: an 88 room Hampton Inn & Suites and a 102 room Hilton Garden Inn located in Alabama; as well as a 112 room Hilton Garden Inn located in North Carolina. The non-recourse loan has a seven year fixed rate term, with a 25 year amortization period. n Colliers Capital Markets team arranges $19.6m in financing WARNER ROBINS, GA — The Colliers Philadel- phia Capital Markets team led by John Banas and
MORRISTOWN, NJ — G.S. Wilcox & Co. announced that Gretchen Wilcox , president, and Al Raymond , principal of G.S. Wilcox & Co have ar- ranged a $24 million first mort- gage for three hotels located in Alabama and North Carolina. The loan was placed with the Minnesota Life Insurance Company which is one of G.
The lending team dedicated to making it happen. At Regal Bank, we specialize inmulti-family lending. In addition to loans up to $6million, we also offer low interest rates, quick approval processes, and non-recourse loans. Count on our team of experts to treat you with the care of a customer and the vested interest of a partner, every step of the way.
Kris Wood a r r a n g e d $19.6 mi l - l i on in f i - n a n c i n g for the ac- quisition of Sandp i per Apartments, a 530-unit multifamily apartment complex in Warner Rob- ins. The team secured the f i n a n c i n g f o r a 3 0 - year loan at
John Banas
Kris Wood
an interest rate of LIBOR + 2.44%. “This was an exist- ing client venturing into a newmarket,” said Banas. “It represented a great, stable opportunity with significant value add.” In addition, the Philadel- phia Capital Markets team also arranged a joint venture equity partner to co-invest with the sponsor. “We were able to arrange a new partnership based on our team’s recognition of the two groups alignment of in- terests,” said Wood. “We look forward to the new venture working together on many future opportunities.” Colliers International Group Inc. is a global real estate services company with more than 16,000 skilled professionals operating in 66 countries. n
Your Lending Team: Sean Howland
Monte Ehrenkranz Vice President of Business Development
Brian McGuinness Senior Vice President and Chief Lending Officer
Vice President and Loan Officer
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The Meridian Group purchases 12 story, 293,539 s/f, LEED Gold building Cushman & Wakefield represents Beacon Capital Partners in sale of office building totaling $106.5m R OSSLYN, VA — Cushman & Wake- field today announced Roosevelt Bridge and Memo- rial Bridge).
“International Place is strategically located in the heart of the dynamic Ross- lyn market,” said Bill Col- lins, Cushman & Wakefield vice chairman. “Rosslyn is quickly transforming itself into a world class city with the delivery of Central Place across the street and the coattails of additional retail and residential development that will follow.” International Place’s ame- nities include a new state-of- the-art 4,376 s/f fitness cen- ter and recently renovated restrooms, a best-in-class conference facility and man- agement office on the ground floor. With views of the Jeffer- son Monument, Memorial Bridge and Potomac River, the building is centrally located nearby JBG Com- panies’ Central Place De- velopment, which features a 17,000 s/f public plaza, a 377-unit residential tower, and 45,000 s/f of ground level retail. n include studios, one and two bedroom apartments with stainless-steel appliances, quartz counter tops and high- end finish details throughout. “We are thrilled to finally be underway in this transforma- tive project for Wilmington and it’s Downtown. A project of this complexity could not be accomplished without extraor- dinary partners including HUD, the State of Delaware, the City of Wilmington, the Wilmington Parking Author- ity, NCALL, WSFS, and Bar- clays. We are truly grateful for all those who made today pos- sible,” said Robert Buccini , co-president of The Buccini/ Pollin Group. The parking garage is ex- pected to be completed in win- ter 2017 with the apartments following in summer 2018. n
that it represented Beacon Capital Partners in the $106.5 million sale of Inter- national Place in Rosslyn. Cushman & Wakefield’s Bill Collins, Paul Collins, Drew Flood and Shaun Weinberg represented Bea- con in the sale of 1735 N Lynn St. to The Meridian Group . International Place is a 12 story, 293,539 s/f, LEED Gold and ENERGY STAR certified office building. The Rosslyn Metro station is di- rectly across the street with Blue, Orange and Silver Lines, and is just one stop from Washington, DC. The Pentagon, Reagan National Airport, Tysons and Dulles International Airport are also nearby. Vehicular ac- cess is available with con- nections to Rte. 50, Inter- states 66 and 395, Wilson and Clarendon Blvd., the George Washington Memo- rial Parkway and all major bridges into DC (Key Bridge, WILMINGTON, DE — Flanked by public officials including Governor Jack Markell, Wilmington-based developer, The Buccini/Pol- lin Group, Inc. (BPG) broke ground on Wilmington’s latest multi-family project: The Resi- dences at Mid-Town Park. Lo- cated at 820 N. Orange St., the former site of the Mid-Town Parking Garage. The develop- ment includes 200 apartments in 2 buildings, 12,000 s/f of retail space and a 511 space parking garage. The total cost of the project is estimated to be $75 million. The project is significant for several reasons. This marks a major move westerly in the Central Business District of the redevelopment that has taken place over the last several years, largely on Mar- ket St. It also restores much
International Place
The Buccini/Pollin Group breaks ground for Wilmington’s latest multi-family project: The Residences at Mid-Town Park
private street which separates the two apartment buildings. The street will be named Bur- ton Place in honor of former Wilmington City Council- man and Civil Rights Leader, Dutch Burton. It was due to his sit-in at the Eagle Coffee Shop (which was located in the former Mid-Town parking structure) in 1958 that eventu- ally Delaware’s Accommoda- tion Law was overturned. The Residences at Mid-Town Park will feature cutting edge amenities the Delaware mar- ket has not yet seen including a demonstration kitchen and a dog washing station. A court- yard is elevated off Shipley St. that includes an outdoor swim- ming pool and barbecue area. The Residences at Mid-town Park will also offer residents a fitness center and screening room. The community will
The Residences at Mid-Town Park
needed public parking to the downtown which has been lacking since the former Mid- Town Parking Garage was condemned. Joe Van Horn, operating partner of Chelsea Tavern, is delighted to see the construc-
tion begin. “We are looking forward to serving our new neighbors on a daily basis, and anticipate that the added public parking will drive new business in a positive direc- tion.” The project will include a
12A — July 15 - 28, 2016 — DelMarVa — M id A tlantic
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D el M ar V a By Wes Guckert, PTP, The Traffic Group The impact of driverless cars on real estate
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forcing real estate investors and developers to re-examine their strategies.
he buzz lately has been all about driv- erless cars and what
parking take up 45% of the downtown central business district, and cars can oc-
of these vehicles means real estate owners and investors should start paying attention now. But, how will driverless cars effect real estate usage and values? Less Parking and Streets Needed If private vehicle owner- ship dramatically declines, the need for all types of park- ing will clearly decline. That means the value of parking garages and parking lots will plummet. It’s also likely that some above ground parking garages will have to be re- purposed.
Parking for high-rise apart- ment buildings that comprise as much as 15% of construc- tion costs, will likely become unnecessary, or at least re- duced. This reduction in cost will increase developer re- turns or allow reduced rental costs by as much as 30%. Keep in mind, any developer who builds parking today could be at a huge disadvantage when the demand for parking diminishes. In addition, parking lanes on streets could be converted to bicycle and scooter lanes, while some streets could be re-purposed into green spaces, decreasing water runoff and heat buildup. San Francisco already has programs that allow residents to repurpose street parking into mini pub- lic spaces or very small parks and patios, called “parklets.” Converting a fraction of San Francisco’s 280,000 parking spaces (which represents 40 million s/f) could result in significant changes in resi- dential and retail markets in San Francisco. Another major change: au- tonomous cars operating as fleets and maintained and refueled at central locations will make the 125,000 gas stations in the U.S. obsolete. Data Centers As millions of vehicles tran- sition into sophisticated mo- bile computer driven telecom- munication devices, the al- ready extraordinary demand for data center space will grow. There will be, poten- tially, a need for office space for high-tech and creative professionals who create the software and designs for these new vehicles. Summary There is no question that vast economic and cultural change will arrive with the driverless car and real estate will be impacted in a variety of ways. Now is the time to prepare. Wes Guckert, PTP, is president & CEO of The Traffic Group, a leading 30-year-old traffic engi- neering and transporta- tion planning firm head- quartered inWhite Marsh, Maryland. For more infor- mation please contact the author at: wguckert@traf- ficgroup.com, visit the web- site www.trafficgroup.com, or follow him on Twitter @ wes_guckert. n
our t rans - p o r t a t i o n future may l o o k l i k e . Transporta- tion Secre- tary Antho- ny Foxx has s a i d f u l l y autonomous
As millions of vehicles transition into sophisticated mobile computer driven telecommunication devices, the already extraordinary demand for data center space will grow.
For example, Houston’s central business district is comprised of 65% streets and surface parking with only 35% for buildings and parks. Even in Washington, DC, which has a sizable mass transit system, streets and
cupy substantial space within buildings - upwards of 30%. It is hoped that driverless vehicles will reduce the need for car-related space, relieve congestion, reduce fuel use, and lower the number of ac- cidents. The likely advent
Wes Guckert
cars will be available to con- sumers within the next ten years. The reality is that these new vehicles will likely drive massive disruption,
There is no question that vast economic and cultural change will arrive with the driverless car and Real Estate will be impacted in a variety of ways. Now is the time to prepare.
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