8-14-20

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ISSUE HIGHLIGHTS Volume 32, Issue 14 August 14 -27, 2020 FINANCIAL DIGEST FEATURING MULTIFAMILY FINANCING

REAT NECK, NY –– Joel Gorjian , a na- tional real estate in- G Part of $25Mdisposition of its 500,000 s/f portfolio in the Midwest, SE, &NE Gorjian Acquisitions sells 489 Atlantic Ave. retail condo. in Brooklyn, NY

anchored strip retail center located on a one-acre site at 523 Ozark Ave. in Cabool, MS. The 1,981 s/f Dunkin Donuts retail property in Gary, Indi- ana is located at 6060 East Ridge Rd. The Lafayette Center at 4233 Lafayette Rd. in Indianapolis, Indiana is an 116,318 s/f strip shopping center anchored by Value City Furniture. The 8,625 s/f Family Dol - lar single tenant property is located at 604 North Main St. in Danville, VA. Lo c a t ed a t 1604 Ea s t Oglethorpe Blvd. in Albany, GA, the 109,000 s/f Oglethorpe Plaza shopping center is an - chored by the Roses discount department store and City Trends. MAREJ

In addition to the Brooklyn property, the sold portfolio included the following assets: The Saint Clairsville Plaza in Saint Clairsville, OH is a 24,000 s/f, four-unit neighbor - hood shopping center anchored by Dollar General. It is located on a 9.5-acre site at 51710 National Rd. East, one mile from Interstate 470’s Exit 1 at Banfield Rd. The freestanding, 19,545 s/f Bradley Square houses medical and professional services ten- ants, including a State Farm insurance office, a podiatry office, a senior day care, and a mortgage financing office. The building is located at 7919-7961 North 76th St. The Cabool Center is a 14,129 s/f, multi-tenant, Dollar General-

ves t or and p r e s i d e n t a n d C E O Gorjian Ac- quisitions , has complet- ed the sale of the 489 At- lant i c Ave. retail condo-

5-17A

Southern NJ Chapter

16-17A

Joel Gorjian

Section B NEW JERSEY/ PENNSYLVANIA

minium as part of a disposition of the firm’s portfolio of eight retail and mixed-use proper- ties. The sold assets total over 500,000 s/f and included prop- erties located in the Midwest, Southeast, and Northeast. The transaction was valued in ex- cess of $25 million. The property at 489 Atlantic

489 Atlantic Ave.

Ave. in Brooklyn, NY is a 2,335 s/f, vacant, St.-level retail con- dominium within a five-story, mixed-use building with a residential component.

Capital Markets Summer 2020 Snapshot

12B

Marcus & Millichap’s Dougherty & Woodard arrange sale of $15.375MPhiladelphia portfolio

UPCOMING CONFERENCES September 2, 2020 6 th Annual NJ CRE Leadership Honoring Women in Real Estate September 9, 2020 5 th Annual PA Healthcare & Medical Conference October 1, 2020 6 th Annual NJ Industrial Development Conference For speaking and sponsorship info., please contact: Lea at 781-740-2900 or lea@marejournal.com

PHILADELPHIA, PA — Marcus & Millichap has an- nounced the sale of The Park-

Scott Woodard , investment specialists in Marcus & Mil- lichap’s Philadelphia office,

side Portfo- lio, a 78,194 s/f retail and of f ice port- folio located in Philadel- phia, accord- ing to Sean Beuche , re- gional man -

had the list- ing to market the property on behalf of t he s e l l e r . “The original d e v e l o p e r , Ro c k l a nd Capital , did an amazing

Derrick Dougherty Scott Woodard

ager of the firm’s Philadel - phia office. The assets sold for $15.375 million. Derrick Dougherty and

job building this portfolio to service the local community in the Parkside section of Phila- delphia. From a retail and office perspective, the asset’s tenant mix proved to be both essential and service oriented with the majority staying open and paying rent through some challenging times” said Dough - erty. The buyer, The Leser Group , was secured and rep- resented by Dougherty and Woodard, “The buyers were based in Brooklyn, NY – from the moment they toured the property, they were extremely bullish on the mix of tenants, predictable income stream, and local submarket. The blend of cap rates between the retail and office components resulted in an extremely at- tractive hybrid return for the

Parkside Portfolio

Directory ROP (Front Section) .................................... Section A Contributing Columnist ...David L. Church, CCIM, U.S. Realty Capital, LLC Office in the Covid-19 Era ..................................... 2A Commercial-Industrial Realty Council Delaware... 4A Financial Digest................................................5-17A People on the Move....................................18A, 20B Business Card Directory & Billboard Directory.....19A New Jersey.......................................................1-14B Central NJ. .......................................................7-11B Pennsylvania.................................................15-BC B Wayne Economic Development Corporation . ......19B www.marej.com

The Parkside Portfolio, lo- cated at 5050, 4946, 4952-64 Parkside Ave., is highlighted by national anchor tenants such as Davita, Santander Bank, & Goodwill. The office portion of this portfolio was fully leased to homecare, government, and lo - cal professional tenants. Situat- ed in the West Parkside section of Philadelphia, this portfolio is highly visible along Parkside Ave. which see’s over 14,433 vehicles per day. The portfolio also benefits from exceptional demographics in the sub-market with the one and three-mile populations being 32,457 and 395,016, respectively. MAREJ

new ownership group” said Woodard. “The Parkside Portfolio was a monumental deal for not only our team but for the Phila- delphia area – we’ve closed a handful of deals during the pandemic, but all of those deals were “All Cash” transactions. This is the first deal we have closed in the last 3 months where there was a lender in- volved. Both the sellers and buyers should be commended and acknowledged for part - nering up, being professional and persistent to transact in a moment of time we will all remember.” Says Dougherty.

Inside Cover A — August 14 -27, 2020 — M id A tlantic Real Estate Journal

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M id A tlantic Real Estate Journal — August 14 - 27, 2020 — 1A

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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 AVP, Conference Producer ...........................Lea Christman Publisher ........................................................Joe Christman Editor/Graphic Artist..... .................................Karen Vachon Contributing Columnist .........David L. Church, CCIM, U.S. Realty Capital, LLC; Ellen Shelly, HF Planners, LLC; Mid Atlantic R eal E state J ournal ~ Published Semi-Monthly Periodicals postage paid at Hingham, Massachusetts and additional mailing offices Postmaster send address change to: Mid Atlantic Real Estate Journal 350 Lincoln St, Suite 1105, Hingham, MA 02043 USPS #22-358 | Vol. 32, Issue 15 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 | Fax: 781-740-2929 www.marej.com

David L. Church, CCIM dchurch@usrealtycapital.com

Office in the Covid-19 Era

O ver the past thirty years many corporate of f ices have given way to cubicles or open work spaces. Some office buildings developed before 1990 with parking ratios of fewer than 4 spaces per 1,000 s/f became functionally obsolete as park- ing ratios of 5 or 6 spaces per 1,000 s/f became the norm for many tenants. In recent years, the use of shared work - spaces by sole proprietors, independent contractors, and employees working remotely exploded – the demand was met largely by WeWork and similar entities that empha- sized large interactive com - mon areas and limited office space. Covid-19 roared into the Mid-Atlantic States in mid- March 2020, and nothing has been the same since. Firms were forced to adapt almost overnight to employees work- ing remotely. During the past four months, companies

perfected remote access and most employees transitioned well to working from home; in fact, a large percentage of employees prefer working from home to commuting one or two hours a day and risking exposure to Covid-19. The current situation raises several questions about the future of office space. Most important to this discussion is whether businesses will outsource their needs for of - fice space and how they will accomplish that goal. So long as Covid-19 is a sig - nificant danger to the health of office workers, businesses are likely to encourage employees

to work from home. However, it is possible that preschool children will not return to daycare and students will not return to campuses in the fall. In order to maintain a high level of productivity, those who work remotely may require more privacy than is offered in a home environment. The shared office model offered by companies such as WeWork or IWG (for- merly Regus) do not appear to offer the degree of social distancing and privacy that are desired in the Covid-19 era. In addition, the severe reduction in business travel continued on page 18A

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M id A tlantic R eal E state J ournal

By Ellen Shelly, HF Planners, LLC Moving Forward – Post COVID-19:

espite its name, the idea of “post-pan - demic” design is very

vision” the graduation speak - ers were preparing to say). A clear vision is the opposite of

greener, reach another mar - ket, establish a better cul - ture, update or upgrade worn

time to ask what your com- pany wants. In what ways are company goals not being supported? How can office space as a whole contribute to the attainment of these goals? How can unified office design support the happiness of employees? Survival is not just created by decisions in the present, but rather mea - sured decisions in the past that form the foundation of your survival today. Navigating corporate goals through strategy, brainstorm - ing, and stakeholder meetings is great. Navigating corporate goals through office design is the next step. Achieving cor - porate goals and standards is facilitated and promoted through good design. Good design promotes your goals by altering physiologically in- fluential components of your office. Good design can make employees feel more collabor- ative, or more focused on their own work. It can promote a sense of individual owner - ship, or rally team spirit. It can enhance the feeling of

psychological safety. A quick Google search with the terms “employee produc - tivity” and “feeling respected” will yield you 117,000,000 results that drive home the breaking point of our corpo- rate goals. A Harvard Busi - ness Review survey from 2013 found that people who reported feeling respected by their boss were 55% more engaged at work. Now is the opportunity to let employees know that business is reliant on the contribution. Jumping into a redesign in these hectic times can seem intimidating. Here at HF Planners we can help guide you through the unknowns, in order to take advantage of the perfect redesign storm that we are experiencing. From lower construction costs to faster construction time- frames and helping manifest the new company culture; HF Planners can help navigate through these changes. Ellen Shelly is junior interior designer at HF Planners, LLC. MAREJ

r o o t e d i n the present. Which is not a bad thing! It means pro- tecting em- ployees and their fami - lies. At the same time, it

Survival is not just created by decisions in the present, but rather measured decisions in the past that form the foundation of your survival today.

what the state is in right now. So, understandably, many companies are sitting idle; trying to recover from the cur- rent pandemic that just hit from all sides. Not unlike mil - lions of individuals across the country and billions across the globe. Most office spaces feel eerie; like the quiet after the storm right now. Activity is limited to a visit from an employee here or there to retrieve paperwork, or maybe some struggling office plants from their desks. There is abundant talent up for grabs, offices are free of the hustle, and we have a mo - ment to recalibrate. With the slate of normalcy wiped clean, we have the opportunity to reinvent ourselves. Maybe we have always wanted to be

out office space. The time for these upgrades is now. This is the corporate equivalent of the personal New Year’s resolution. Everyone has a different approach to self- improvement. Some project their goals to have friends hold them accountable, oth - ers work internally and only emerge once work has been completed; sadly, many fall back onto comfortable old habits and fail. Now is the time to jump full throttle into redesigning companies and structure for a new future. There is an abundance of studies about what millen - nials do and do not want in an office space. What they do and do not want in an office culture. What they do and do not want in terms of work-life balance. Now is the

Ellen Shelly

is always short sighted for a company to focus solely on the predominant issue that is presently at hand. There is always something else to consider, currently the pandemic that we are facing is opening up a lot of doors; in addition to company ac - countability for the health of employees. We have just witnessed the fastest spike in unemployment in history. Hiring freezes are widespread and indefinite. The Class of 2020 did not hear their com - mencement speeches about having a “clear vision for the future” like we expected (or whatever parallel to “20/20

4A — August 14 - 27, 2020 — DelMarVa — M id A tlantic Real Estate Journal

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D el M ar V a Commercial-Industrial Realty Council Great CRE Events...Cont. Education...Speakers...Networking www.CircDelaware.org

2 0 2 0 d i r e c t o r s — O F F I C E R S — President: Robert Stenta Pettinaro Management, LLC Vice President + Program Chair: Jay L. White , MAI, CRE® Apex Realty Advisory Treasurer: Barton L. Mackey, Jr. Patterson-Woods Associates Secretary: Bayard Snyder , Esq. Bayard & Associates — D I R E C T O R S — Education Chair: Cynthia Fleming Jones Lang LaSalle

Commercial Real Estate Post COVID-19 Outlook Panel by: Robert Stenta (CIRC President) and Jay L. White,MAI CRE (CIRC Vice President)

“W ithout the ability to meet in person at our monthly membership meetings, on June 25 th we hosted our first-ever CIRC Zoom meeting, with an es- teemed panel of commercial real estate professionals and over 150 industry attendees. Here is a brief summary of what was discussed and what we learned. The COVID-19 business shutdown was swift as it spread over the local econo- my, drastically changing consumer behavior and forc- ing area landlords, brokers, and economic development

COVID-19 has changed many things, including our industry. But after dealing with adversity and adapting to the "New Nor- mal," hopefully with a vaccine over the mid-term, the market uncertainty will surely diminish and, eventually, we can resume business and economic gains. Hopefully we will be able to look back on these days with pride in the way we worked together to get through it safely. But until that day, we have a lot of work to do, so let’s get to it!” Look for CIRC's upcoming events in the fall, starting September 9. Meet the Presenters (1st Row - Program organizers): Robert Stenta , Pettinaro Jay L. White , Apex Realty Advisory Janet Pippert , Landmark Sci. & Eng. (Lorraine Sheldon, Emory Hill- not shown) (2nd Row, Moderator & Panelists): Bill Russell , Wye Realty Advisors (Mod.) Jeffrey Flynn , City of Wilmington E.D. Robert Buccini , Buccini/Pollin Group (3rd Row, Panelists): Neil Kilian , SIOR, CCIM, NAI Emory Hill Pamela Scott , Esq., Saul Ewing CIRC Sponsors Polls 1. Should Rob Stenta shave the COVID- Stash and get a haircut? 67% - No, I like the Wyatt Earp look! 33% - Yes, it's got to go! 2. How much do you think local commercial real estate values have changed since COVID-19 began? 3. What is your outlook for local office leasing demand over the remainder of 2020? 55% - Absorption will be flat 30% - Absorption will decline 15% - Absorption will increase 4. What will our economic recovery look like? 72% - "Nike Swoosh" (slow & gradual) 55% - Downward by < 10% 11% - Downward by > 10% 30% - No change/held flat 4% - Increased

Membership Chair: James Manna BrightFields, Inc. Past President:

professionals to adapt to the uncertainty of the market as well. Most of the com- mercial landlords have reported the need to provide some sort of rent relief to a portion of their tenants, primarily to re- tailers. Typically this relief has been in the form of rent deferrals as opposed to rent reductions or abatements. Retail tenants have clearly been the most impacted, with restaurants, day cares, salons, and, of course, fitness centers being the hardest hit. While some office tenants have been adversely impacted, most have been able to proceed smoothly with their employees working from home, and, while they aren’t excited about paying for space they aren’t using at the moment, they have continued to pay their rents, largely, on time and in full. On a positive note, residential multi- family leasing activity and rent collec- tions have remained strong, while hotels are slowly, but surely, recovering after a significant and painful drop in their occupancy rates that occurred when almost all business and personal travel came to a screeching halt in March. The “shining star” in all the commercial real estate sectors, post-COVID, has been industrial. With its important place in our world when it comes to the manufac- turing, storage, and delivery of essential products and goods, demand for indus- trial space has increased and shows no signs of slowing down. In Delaware, construction was deemed essential during the shutdown, allowing major construction projects to continue with new safety guidelines. Amazon’s

massive (3.8 million square foot) distri- bution center on a portion of the former GM Boxwood plant at Del. 141 was one of the most visible projects we have watched proceed rapidly during the shut- down. In addition, the demolition of the former DuPont Barley Mill Plaza office complex was also completed during the shutdown, continuing to pave the way for a mixed-use complex which will include Delaware’s first Wegmans. In short, our panelists, and most of CIRC’s membership, have kept very busy combating the impacts of the virus in its own unique ways. Whether it is by help- ing a company get its paperwork together to apply for a federal PPP loan, working through a rent deferment plan, retrofit- ting offices to promote more social dis- tancing, or ensuring office buildings have enhanced cleaning/janitorial services to fight the virus and make it safe for people to return to the office. There is so much we are doing to help our community through these challenging times. With more projects pushing forward as our industry looks to the future, the com- mercial real estate community is banking on people desperately wanting to get back out into the world. Whether for a face-to-face meeting with a client after months of “Zoom Fatigue,” or shar- ing a great meal with friends at a favorite restaurant, commercial real estate will always be a very important part of all of our lives.

Donald Robitzer The Commonwealth Group Benjamin Berger, Esq. Berger Harris, LLC Carmen Facciolo NAI Emory Hill Michael Hahn 44 Business Capital Jim O’Hara , Jr. NAI Emory Hill-Retail Division Lorraine Sheldon NAI Emory Hill Daniel Wham DSM Commercial Real Estate Ryan Kennedy Harvey Hanna & Associates — E X - O F F I C I O — Business Manager: Janet S. Pippert Landmark Science & Engineering

Legislative Lobbyist: C. Scott Kidner C. S. Kidner & Associates Legislative Affairs Chair: William Lower Harvey Hanna & Associates Economic Dev. Liaisons:

Robert Chadwick , NCCC EDC Joseph Zilcosky, Div. Small Bus. Kurt Foreman, Del. Pros. P'ship Jeff Flynn, City of Wilmington c o n t a c t u s Janet@circdelaware.org (302) 633-1705 www.circdelaware.org

16% - "W" recovery 12% - "V" recovery

5. How optimistic about the future are you after hearing from our panelists?

51% - More optimistic 47% - About the same 2% - Less optimistic

F inancial D igest F eaturing I nvestment /M ultifamily F inancing

M id A tlantic Real Estate Journal — August 14 - 27, 2020 — 5A NorthMarq’s Ranieri negotiates construction financing of $10M

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ASHINGTON, DC — Love Funding , one of the nation’s Midland States Bank completes short-term bridge loans Love Funding showcases HUD versatility inQ2 2020 financings W

leading providers of FHA multifamily, affordable and healthcare financing, an - nounced more than $97.3 MM in HUD financings dur - ing Q2 2020. Love Funding partnered with HUD to pro - vide its borrowers with long term, non-recourse, low- and fixed-rate debt solutions. Love Funding’s parent company, Midland States Bank , was able to complete short-term bridge loans to secure fund - ing. Q2 2020 Financing High - lights: • The $3.14MM acquisition of Egida Hogar San Antonio, a Section 202 Loan property located in Guayama, Puerto Rico, was financed through HUD’s 223(f) program. The borrower was able to ac- quire this Section 8 project and extend the affordability component by entering into a new 20-year HAP contract. The borrower was also able to realize additional savings through HUD’s reduced ap - plication fee incentive for projects located in a Qualified Opportunity Zone. • Financing of the $12.9MM Woodlands of Arnold, an as - sisting living, memory care, and skilled nursing facility WILMINGTON, DE — Cin- naire announced two key ap - pointments in the organiza- tion’s Mid Atlantic office. Azeez Weeks has joined the organiza - tion as development manager for Cinnaire Solutions, a newly created position to advance Cin - naire’sWilmington Priority City initiatives. Matt Hodges has joined Cinnaire as VP, business funding, leading the develop - ment of equity funds in the Mid Atlantic to support Cinnaire’s affordable housing and com - munity redevelopment efforts. As development manager, Azeez will support project man - agement, assist in the develop - ment of the Cinnaire Solutions pipeline and provide leadership and guidance to partners in

Opus rendering

draw tenants from the area as well as those who currently reside in New York City and want a lower density housing option.” As a capital markets leader, NorthMarq offers commercial real estate investors access to experts in debt, equity, invest - ment sales, and loan servicing to protect and add value to their assets. For capital sources, we offer partnership and financial acumen that support long- and short-term investment goals. Our culture of integrity and innovation is evident in our 60- year history, annual transac - tion volume of $13 billion, loan servicing portfolio of more than $61 billion and the multi-year tenure of our more than 600 people. MAREJ

WHITE PLAINS, NY — Robert Ranieri , senior vice president/managing director of NorthMarq’s White Plains office negotiated construction financing of $10 million for Opus. The 49-unit multifam - ily property will be located on Ridge Rd. in North Arling - ton, NJ. The transaction was structured with an 18-month interest-only term. NorthMarq arranged financing for the bor - rower through its relationship with a local bank. “This transaction was start - ed pre-COVID but we were able to get the loan approved and closed during the pandemic,” said Ranieri. “The project will be a high quality apartment and the Town of North Arling - ton was very receptive. It will

Chickasaw Place

located in Arnold, MO, show - cased Love Funding’s creativ - ity and partnership with Mid - land States Bank by providing a short-term bridge loan as a mechanism to complete a cash-out refinance. Midland was able to fund the bridge transaction for the borrower, and Love Funding then imme - diately applied to HUD for the permanent mortgage through HUD’s 232/223(f) program. • The $18.2MM HUD-in - sured loan for Chickasaw Place, a 272-unit, Section 8 project, was financed through HUD’s 223(f) program in con - junction with 4% Low-Income Housing Tax Credits with Tax-Exempt Bonds allocated by the Tennessee Housing Wilmington. Azeez brings a unique set of analytical, prob - lem-solving and technical skills to Cinnaire. He recently worked as Enterprise MobilityManager at Genesis Healthcare. There, he was responsible for leading a team to determine, imple - ment and manage the corporate strategy and policy for mobile devices. Prior to that position, he worked as a Genius Lead and Business Specialist at Apple, Inc. He earned his Bachelor of Science in Business Adminis - tration and Marketing from the University of Delaware. “Cinnaire Solutions has made significant strides working with our partners to revitalize and transform the communities we serve,” said Chris Laurent ,

Development Agency and Tax-Exempt Bonds issued by The Health, Educational, and Housing Facility Board of the City of Memphis. The HUD loan will be used to preserve and enhance the project with a scope of proposed renovation at approximately $34,800/ unit. Love Funding also utilized HUD’s Interest Rate Reduc - tion and 223(a)(7) programs to improve cash flows at six currently HUD-insured projects by taking advantage of the low interest rate envi- ronment. Both programs are designed to offer a stream - lined solution to lower debt service payments through lower interest rates. MAREJ Cinnaire Solutions president. “Azeez is a dynamic addition to our team. We are confident his unique knowledge and proven leadership skills will elevate the resources Cinnaire Solu- tions brings to the table. We are excited to have Azeez join our team to advance our Wilm - ington Priority City initiatives.” As VP, business funding, Hodges is charged with raising equity capital and managing investor relationships for Cin- naire’s Mid Atlantic region. Matt has a strong institutional sales background, with ex - perience in affordable hous - ing, renewable and alternative energy, and new market and historic rehabilitation tax credit equity. MAREJ

Houlihan-Parnes announce placement of $10 Million loan

Cinnaire welcomes Weeks & Hodges

Five Towns Shopping Center

Shop. The 500,000 s/f shopping center is in the Five Towns area of Nassau County, just east of JFK International Air - port. The Center has a robust tenant roster that includes Lowe’s Home Center, TJ Maxx, Wal-Mart, T-Mobile, and Chick fil a, as well as the incoming Stop & Shop. The borrower was represented by Elizabeth Smith of Goldberg Weprin Finkel Goldstein LLP and title was acquired by Chicago Title . MAREJ

WOODMERE, NY — Jim Houlihan, Bryan Houlihan , and Christie Houlihan of Houlihan-Parnes Realtors, LLC to announced the place - ment of a construction loan in the amount of $10 million on the Five Towns Shopping Cen- ter located at 253-01 Rockaway Blvd., Woodmere. The loan was placed with a national lender with a fixed rate of 2.78%. The proceeds of the loan will be used for the build out of a brand-new 80,000 s/f Stop &

6A — August 14 - 27, 2020 — Financial Digest — Investment/Multifamily Financing — M id A tlantic Real Estate Journal

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I nvestment /M ultifamily F inancing

ay Propert ies an- nounced the success - ful completion of five Lapin and McFarland complete transaction Kay Props. helps a client stay debt-free in their $1M 1031 Exchange into DST Properties for sale K

1031 exchange, we were able to work with them to select five different debt free DST properties, diversified across five states and across 4 differ - ent asset classes.” McFarland said, “After suc - cessfully completing their DST 1031 investment purchases, the clients informed me that they were confident with their purchases and diversifica - tion profile of their 1031 DST portfolio as we head into an ever-changing and uncertain future.” About Kay Properties and www.kpi1031.com

Kay Properties is a national Delaware Statutory Trust (DST) investment firm. The www.kpi1031.com platform provides access to the mar - ketplace of DSTs from over 25 different sponsor companies, custom DSTs only available to Kay clients, independent advice on DST sponsor com - panies, full due diligence and vetting on each DST (typically 20-40 DSTs) and a DST sec - ondary market. Kay Proper - ties teammembers collectively have over 115 years of real estate experience, are licensed in all 50 states, and have par - ticipated in over $15 billion of DST 1031 investments. *Diversification does not guarantee profits or protect against losses. *This case study may not be representative of the ex- perience of other clients. Past performance does not guar - antee or indicate the likeli - hood of future results. Please speak with your attorney and CPA before considering an investment. This material does not consti - tute an offer to sell nor a solici- tation of an offer to buy any se- curity. Such offers can be made only by the confidential Private Placement Memorandum (the “Memorandum”). Please read the entire Memorandum pay - ing special attention to the risk section prior to 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. There are material risks associated with investing in real estate securities including illiquidity, vacancies, general market con - ditions and competition, lack of operating history, interest rate risks, general risks of owning/ operating commercial and mul - tifamily properties, financing risks, potential adverse tax consequences, general eco - nomic risks, development risks and long hold periods. There is a risk of loss of the entire investment principal. Past performance is not a guaran- tee of future results. Potential cash flow, potential returns and potential appreciation are not guaranteed. Securities offered through Growth Capi - tal Services (GFS) member FINRA, SIPC Office of Super - visory Jurisdiction located at 582 Market St., Suite 300, San Francisco, CA 94104. MAREJ

members Chay Lapin , senior vice president, and Matt Mc- Farland , associate. Lapin said, “Over a period of approximately six months, we helped educate the clients on the potential pros and cons of real estate, 1031 exchanges and DST structured invest - ments. Through ongoing dia - logue and correspondence, the clients decided that they want - ed to remain debt-free and take a conservative position in their DST 1031 investments. By the time their single-family investment property sold and they officially entered into a

debt-free DST purchases for a couple selling a single-family home in Southern California. They were excited to be able to defer the accumulated capital gains and deprecia - tion recapture taxes that they have accumulated over the many years of owning and managing the property by utilizing Internal Revenue Code, Section 1031. In ad - dition to deferring the taxes by successfully utilizing the 1031 exchange, the clients

were grateful to invest and diversify into more passive real estate investments by utilizing the Kay Properties 1031 DST marketplace at www.kpi1031.com. The Delaware Statutory Trust exchange investments were completed by Kay Prop - erties and Investments team

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Thinking about selling your investment property? CONSIDERING A 1031 EXCHANGE?

CALLTODAY for a FREE book on 1031 exchanges as well as a FREE list of available 1031 exchange listings: 1.855.899.4597

Login at the Kay Properties 1031 Marketplace at www.kpi1031.com for FREE access to: ✔ 1031 Exchange Solutions ✔ Delaware Statutory Trust - DST Properties ✔ Management Free 1031 Options - No More Tenants, Toilets and Trash! ✔ Triple Net Leased - NNN Properties ✔ 721 UPREIT Investments - How to 1031 into a Real Estate Investment Trust (REIT)

AVAILABLE OPPORTUNITIES 7%

ACQUISITION FUND, LLC - 7% Debentures* Minimum Investment: $50k The Acquisition Fund LLC

SEATTLE MULTIFAMILY DST Minimum Investment: $50k An all-cash / debt-free mul-

was formed to facilitate the acquisition and in- ventory of long-term net leased assets,multifam- ily assets and private equity real estate invest- ments. The offering provides investors with the ability to participate in the sponsor’s inventorying of real estate assets prior to syndication. *The Debentures will bear non-compounded interest at the annual rate of 7.0% per annum (computed on the basis of a 365-day year) on the outstanding principal, payable monthly on between the fifteenth and twenti- eth day of the following month. An investment in the Debentures will begin accruing interest upon accep- tance and closing of the Investor’s Subscription Agree- ment. There is a risk Investors may not receive distri- butions, along with a risk of loss of principal invested.

tifamily apartment community. Located in the Se- attle Metropolitan Area which is home to a strong workforce with Amazon, Microsoft, and Expedia. This all-cash/debt-free 1031 exchange offering is believed to potentially possess a defensive cash flow profile with existing and resilient occupancy along with the potential for asset appreciation as the demand from Seattle’s core central busi- ness district supports greater growth in broader submarket neighborhoods. The offering which is available to 1031 exchange and cash investors also has a cost segregation report prepared to enhance investors depreciation write offs and tax sheltering of projected monthly income.

SHREVEPORT PHARMACY DST Minimum Investment: $50k

A long-term net lease offering with a corporate Walgreens guarantee. Walgreens has been a tenant at this location since 1999 and recent- ly extended their lease an additional 10 years, showing a strong commitment to the site and trade area. The offering which is available to 1031 exchange and cash investors also has a cost segregation report prepared to enhance in- vestors depreciation write offs and tax sheltering of projected monthly income.

** All offerings shown are Regulation D, Rule 506(c) offerings. 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. 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 Growth Capital Services (GFS) member FINRA, SIPC Office of Supervisory Jurisdiction located at 582 Market Street, Suite 300, San Francisco, CA 94104. Kay Properties and Investments, LLC and GFS are separate entities. These testimonials may not be representative of the experience of other clients. Past performance does not guarantee or indicate the likelihood of future results.These clients were not compensated for their testimonials. Please speak with your attorney and CPA before considering an investment. ABOUT KAY PROPERTIES and WWW.KPI1031.COM Kay Properties is a national Delaware StatutoryTrust (DST) investment firm. The www.kpi1031.com platform provides access to the marketplace of DSTs from over 25 different sponsor companies, custom DSTs only available to Kay clients, independent advice on DST sponsor companies, full due diligence and vetting on each DST (typically 20-40 DSTs) and a DST secondary market. Kay Properties team members collectively have over 115 years of real estate experience, are licensed in all 50 states, and have participated in over 15 Billion of DST 1031 investments. WWW.KPI1031.COM 855.899.4597 LEARN MORE:

8A — August 14 - 27, 2020 — Financial Digest — Investment/Multifamily Financing — M id A tlantic Real Estate Journal

www.marej.com

I nvestment /M ultifamily F inancing

By Mark Scott, Commercial Mortgage Capital The market is no longer February’s market…

will the November election bring us? A new administra - tion has promised to pull the plug on the 1031 and the overall real estate market. Many moving parts to the new COVID economy. Front line loan officers still have the desire to make loans. Banks are flush with cash, CMBS lenders have found a new market floor to dance on, and life companies seek to cherry pick the deals. The number of cherry deals are shrinking as rent collections in most asset classes, have been adversely impacted by

the pandemic. True—Headline interest rates are down. Treasuries are down, spreads are a bit wider. Beware though, of the effective cost of loans in many loan products is a bit more than the headline numbers. Multifamily agency lenders are now requiring significant debt service reserves (some as much as a year) which serves to suppress usable proceeds and increases the effective cost of loans. CMBS lend- ers are toying with and now requiring a “COVID Interest Reserve”. This new reserve is

As a result of these changes, the velocity of transactions in all sectors has slowed as buyers, sellers, borrowers and lenders adjust to a new reality, a new world of risks and a new period of price discovery. In the world of mortgage fi - nance, daily, I ammade aware by lenders of credit officers tightening lending standards as the future is still quite unclear. Fear of the future abounds. Will there be a cure or vaccine to shift market direction? Will government support of the consumer and businesses continue? What

to be held based on the status of the local and state COVID orders at the location of the property. Escrow funds may not be released until Stage IV levels (for example as in NY State; now on July 24) are achieved. Buyer beware in the new COVID market. For mortgage bankers (such as yours truly) times are good. Many borrower relationship lenders have been disrupted or adversely impacted. Thus the increased assistance of an experienced mortgage banker can assist in sourcing capital. Although transactional sales activity is down, owners should be reviewing their portfolios seeking any and all oppor - tunity to employ a mortgage banker and work to lower their borrowing costs and overall cost of capital. Mark Scott is president of Commercial Mortgage Capi - tal, a correspondent Mortgage Banking firm based in Livings - ton NJ. Mark brings 35 years of commercial and mortgage banking expertise to each proj - ect he works on. Mark Scott is founder and principal of Commercial Mortgage Capital in Liv- ingston, NJ. MAREJ CMC secures $19M in financing for 504 multi-family units LIVINGSTON, NJ — Liv- ingston based, Commercial Mortgage Capital , recently announced it secured $19 million in financing for 504 garden apartment units. The loan was arranged by Mark Scott , president of Com- mercial Mortgage Capital, through Spencer Savings Bank . “CMC is pleased to secure this financing on behalf of our client. Given the current situation with the COVID-19 pandemic, we were thrilled to be able to find the capital and close this loan at a low fixed rate,” said Mark Scott in a prepared statement. The two loans closed are secured by 208 units at Bell- mawr Manor located in Bell- mawr, NJ and 296 units at Stonebridge Run located in Bristol, PA. CMC’s loan volume has been exceptionally strong during the COVID-19 crisis while borrowers seek opportunistic capital from the limited lend- ers available. MAREJ

very commercial proper- ty owner, developer, bro- ker and borrower I know

has been af- fected by CO- VID. Prices have adjust- ed, financing terms have changed and t h e w o r l d is in a new place. No lon- ger are we in

Mark Scott

the high flying 3.5%, 4.5% cap rate world or in an Interest Only MAX proceeds financing environment of February 2020.

R I T T E N H O U S E C A P I T A L A D V I S O R S E x p a n d i n g C l i e n t B a s e & R o s t e r o f L e n d i n g O p t i o n s T h r o u g h C O V I D - 1 9

P r o p e r t y T y p e s I n c l u d e : M u l t i - F a m i l y , S e n i o r L i v i n g , M i x e d - U s e , R e t a i l , O f f i c e , M e d i c a l O f f i c e , H o s p i t a l i t y , S i n g l e T e n a n t N e t L e a s e

George Johnson President & CEO

Joe Hanascin VP, Lending Operations

William Patton Transaction Manager

Ken Wellar Partner

Corey Lonberger Partner

107 S. 2nd Street, 4th Floor Philadelphia, PA 19106 ph. 215.454.2852 info@rittenhousecapital.com

M id A tlantic Real Estate Journal — Investment/Multifamily Financing — Financial Digest — August 14 - 27, 2020 — 9A I nvestment /M ultifamily F inancing

www.marej.com

STILL CLOSING DEALS!

COMMERCIAL MORTGAGE CAPITAL MIDYEAR 2020 TRANSACTIONS $222,830,000 21 loans - 1,498 units

Commercial Mortgage Capital, a proud partner of US Realty Capital, leverages strong, long-term relationships with a national network of lenders to create innovative debt & equity solutions.

New Jersey Office: 615 West Mt. Pleasant Avenue Livingston, NJ 07039 www.usrealtycapital.com

Mark M. Scott, Principal Direct: (201) 787-7111

mscott@newcommercialmortgage.com www.newcommercialmortgage.com CALL TO EXPERIENCE CMC RESULTS!

10A — August 14 - 27, 2020 — Financial Digest — Investment/Multifamily Financing — M id A tlantic Real Estate Journal

www.marej.com

I nvestment /M ultifamily F inancing Land and air rights aquired from the New York City Housing Authority Progress Capital’s Domenico arranges $22 Million loan for DoBro Air Rights

nent, is now shaping up to be over 400,000 s/f after acquir- ing $25 million of land and air rights from the NewYork City Housing Authority (NYCHA) . The new project will still fuel their passion of providing affordable hous- ing to New York residents while also providing Ingersoll House funds for necessary repairs. Brad Domenico of Prog- ress Capital arranged a $30 million loan from Natixis (se- nior) and Libremax Capital (mezz) for the acquisition of 202 Tillary St. in 2018. When Jorge Madruga and Eli

Weiss had the ability to pur- chase the additional acreage and air rights from NYCHA, Domenico went back to Libre- max, who upsized their mezz position by advancing an ad- ditional $22 million. “I always tell my clients that relationships are often more important than rate shopping, especially when it comes to development. This is a perfect example of how the Maddd Equities and Joy Construction relationship with Natixis and Libremax allowed for this acquisition during COVID.” MAREJ Walker & Dunlop adds Sobel to its multifamily small loans origination team in NY BETHESDA, MD — Walker & Dunlop, Inc. has hired Jared Sobel as managing

ROOKLYN, NY — In August 2018, Maddd Equities and Joy

Construc - t i o n p u r - chased 202 Tillary St. in Down t own Brooklyn for $30 million wh i ch was (and still is) a 115,000 s/f

Brad Domenico

American Self Storage. As ex- pected, they had bigger plans for the site. What was origi- nally going to be a 235,000 s/f residential building with a significant affordable compo -

202 Tillary St.

director in its New York of- fice. Sobel will play a lead- ing role in the growth of the c o m p a n y ’ s multi fami ly smal l loans group, which provides sus-

Jared Sobel

tainable and affordable financ - ing solutions for smaller apart- ment properties. Don King , executive VP and chief production officer for Walker & Dunlop’s multifam- ily finance team, commented, “The addition of Jared will be transformational to our small loans team. He has a proven track record of success originat- ing loans under the Freddie Mac Optigo Small Balance Loan Program and the Fannie Mae Multifamily Small Loan Program, a deep understand- ing of this niche business, and has thus been a top originator in the space for several years.” He continued, “We are pleased to welcome Jared to the team, and to continue growing our presence in the multifamily small loans space.” Sobel said, “I am looking forward to helping drive fur- ther growth inWalker &Dun- lop’s multifamily business. The company’s brand, busi- ness results, and multifamily thought leadership bring an incredibly powerful value proposition for my current and future clients.” MAREJ

M id A tlantic Real Estate Journal — Investment/Multifamily Financing — Financial Digest — August 14 - 27, 2020 — 11A I nvestment /M ultifamily F inancing

www.marej.com

12A — August 14 - 27, 2020 — Financial Digest — Investment/Multifamily Financing — M id A tlantic Real Estate Journal

www.marej.com

I nvestment /M ultifamily F inancing

By Scott R. Saunders, Asset Preservation, Inc. 1031 Exchange Update - Summer 2020

as fee ownership, co-ownership, leasehold, easement, option to acquire real property as well as a license, permit, similar rights solely for the use, enjoyment or occupation of land and/or inher- ently permanent structure. The Proposed Treasury Regulations also clarified that local law definitions are not control- ling in determining whether property is real property and noted that every distinct asset must be analyzed separately to determine if the asset qualifies as real property. Also, in June 1031 exchange activity picked up considerably and this trend has continued into July and shows no signs of slowing down soon. The mix of 1031 exchange activity has changed from early spring until now. There are considerably more residential exchanges and transactions involving 1-4 units, land, vaca- tion homes held for investment, farms/ranches compared to commercial exchange transac- tions. There are several reasons for the uptick in residential exchange activity: Residential 1031 Exchange Market • The normal strong spring selling season was compressed and has been pushed back a couple of months into summer and likely fall. • Historically low-interest rates have made financing resi - dential transactions especially attractive for investors and homeowners. The interest rate for a 30-year mortgage dropped below 3% making the cost of financing very attractive and boosting cash flow for investors. • In late March and April, many sellers decided not to list their properties as no one wanted strangers tour- ing homes when there was so much uncertainty regarding COVID-19. The lack of new listings led to less inventory and more demand for exist- ing properties on the market. In fact, residential demand is so robust that many areas nationally are currently seeing bidding wars for residential properties. These bidding wars affect both home buyers and those seeking to purchase single-family rental (SFR) properties in 1031 exchanges. It is not uncommon for a prop- erty to go under contract the same day it hits the real es- tate market. This has created a challenging situation for continued on page 18A

he 1031 exchange mar- ket nationally has been like a roller coaster this

and/or shelter at home. The Treasury provided tax relief to some investors with Notice 2020-23 which extended many deadlines for investors affected by the COVID-19 pandemic in- cluding Section 1031 exchange time deadlines. Notice 2020-23 extended the 45-day identi- fication period deadline and 180-day exchange period for certain investors until July 15, 2020. (Note: There is no further extension in place currently.) After a large drop in ex- change transactions, where ac- tivity was about half of normal in late March and April, inMay

exchange transactional volume trended upward slightly as states slowly anticipated loos- ening restrictions and business- es reopened again. Addition- ally, real estate professionals and investors were beginning to adjust to virtual transac- tions. Video and interactive tours of properties replaced in-person inspections and walk- throughs. Closing offices and the title insurance industry innovated quickly in response to these new challenges. The marketplace adjusted to closing transactions virtually as new technologies and processes like

virtual notaries rapidly evolved to help sellers and buyers’ close transactions. On June 11, 2020, the Trea- sury released proposed regula- tions addressing what is consid- ered “real property” for Section 1031 exchange purposes after the enactment of Tax Cuts and Jobs Act (TCJA.) The proposed Treasury Regulations defined real property as land, “inher- ently permanent structures,” “structural components” of inherently permanent struc- tures, unsevered crops, water and space adjacent to land, interest in real property such

past spring and summer, plummeting down in April and roaring back up start- ing in June. I n l a t e Mar ch and A p r i l e x - change activ-

Scott R. Saunders

ity dropped off significantly as a result of the COVID-19 pandemic which forced the en- tire nation to work from home

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