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ISSUE HIGHLIGHTS Volume 26 Issue 18 Sept. 26 - Oct. 9, 2014

Mikula, Didio and Seiden led debt placement team representing the borrower HFF arranges $70m in financing for Curling Club Apartments in Hoboken

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Streets and 12th and 11th Streets. Completed in 1999, the property consists of four five-story residential build- ings above a single level parking garage as well as a free-standing, single-story clubhouse and an interior courtyard. All of the apart- ments are two-bedroom, two- bathroom units. Community amenities at the pet-friendly residence include a fitness center, resident’s lounge, stor- age units and garage parking. Residents also benefit from shuttle service to the PATH station. The HFF debt placement team representing the bor- rower was led by senior man- aging directors Jon Mikula and TomDidio and associate director Samuel Seiden . n of a residential mid-rise build- ing, the school at 256 Warren St. is River School’s fourth location and marks an ex- pansion of its presence in the Exchange Place neighborhood. The organization maintains a school at 251 Warren St., which primarily serves a pre- school population now that the younger children have moved to the new facility. River School also operates across town in the mixed-use Newport development; PSA designed an expansion of that school at 30 Newport Pwy. in 2009. Additionally, the school maintains a location on Man- hattan’s Upper West Side. “With the addition of our newest facility, River School will proudly serve 450 fami- lies,” Kresch said. “Our growth speaks to high demand for quality childcare in the region, as well as to the caliber of our teachers, staff, programs and facilities. As we have looked for the best places and spaces to expand, Barry has been instrumental in helping us assess opportunities.” n

OBOKEN, NJ — HFF announced that it has arranged $70

million in financing for Curl- ing Club Apartments, a 240- unit, class A multi-housing community in Hoboken. HFF worked on behalf of the borrower, institutional inves- tors advised by J.P. Morgan Asset Management, to secure the fixed-rate loan through Nationwide Life Insurance Company. HFF brokered the sale of the asset to the bor- rower in June 2014. Curling Club Apartments encompasses a full city block in the uptown Hoboken sub- market between Grand and Adams Streets and 12th and 11th Streets, as well as the northern half of the block between Clinton and Grand

5-13A

Landlordwins insurancepayment due to lease By JerryNelson, Esq.

Curling Club Apartments

Five classrooms, indoor play areas, an administrative office, kitchen and storage area Poskanzer Skott Architects designs newest River School facility in Jersey City at 256 Warren Street

To Register www.marejournal.com Multifamily Summit Nov. 13 NNJ Retail & Restaurant Summit Dec. 11 NJ Real Estate Capital Markets Summit Page 2 2014 Conference Schedule Oct. 17 PA Apartment /

JERSEYCITY, NJ — Pos- kanzer Skott Architects (PSA) recently completed the design of River School’s new- est location at 256 Warren St. in Jersey City. According to Barry Poskanzer, AIA , one of the best parts of the project for the expanding childcare provider was the ability to exercise a sense of youth- ful creativity to produce an environment that promotes

Directory

River School

Owners, Developers & Managers..Section B Green Buildings............................. 11-18B Shopping Centers..........................Section C

learning, comfort and fun. “Developing inviting, nur- turing environments for young children allows for more inventiveness and artis- tic freedom than many other types of projects,” Poskanzer said. “In the case of River School, our underlying theme involved simple lines, with clean neutrals and punches of bright, primary colors.” PSA designed five classrooms, indoor play areas, an admin- istrative office, kitchen and

storage in the 5,500 s/f area. “As educators and caregiv- ers our role is to provide an at- mosphere where children are encouraged to explore and be curious, where they feel safe and loved, and where they can learn about their emo- tions and gain social skills,” said Richard Kresch, River School’s sponsor. “Barry and the Poskanzer Skott team cre- ated a beautiful place for our children to learn and grow.” Located on the ground floor

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$19,500,000

50 EMJAY BOULEVARD BRENTWOOD, NY A 542,000 square foot industrial building

The undersigned arranged the above 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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New England Fine Properties

HINGHAM, MASSACHUSETTS ... Custom-designed European Country-style residence with 6,865 square feet of living space on three levels, specifically sited on a 1.6 acre lot to capture harbor views and the Boston skyline. The house has 14 rooms, 4 bedrooms, 5.5 bathrooms, an in-ground swimming pool, a spa, and a cabana. ... $5,200,000

HINGHAM, MASSACHUSETTS ... On Hingham Harbor with 223 feet of direct waterfront is this 15 room, 5 bedroom, 3.5 bathroom residence. Extensive details include bay windows, French doors, window seats, and custom-built cabinetry. A covered walkway leads to a three story, studio/guest house with 1.5 bathrooms, a loft, and workshop. ... $4,685,000

HINGHAM, MASSACHUSETTS ... This 10 room, 3 bedroom, 4 bathroom 2010 built Shingle-style residence has a captivating waterfront location. The thoughtfully designed residence has walls of glass and an open floor plan that affords direct ocean access for swimming, boating, and numerous nautical endeavors. ... $2,475,000

HINGHAM, MASSACHUSETTS ... A 4 bedroom residence set amid birches and cedars with rock outcroppings that slopes to the water. The house has been expanded, updated, and well maintained by the present owners. There are fireplaces in the living room, family room, and lower level playroom. Set on .62 acres, it also includes a dock. ... $ 1,950,000

Joe Christman

Cell: 617.962.6690 •

•

jchristman@HammondRE.com

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MAREJ A dvertisers D irectory To advertise, call 1-800-584-1062 A&E Construction Company...........................................................9C AIDC ��4A AKRF��17B American Architectural �� 1B Bayshore Recycling ��12B Bennett Williams ��11C Brubacher Excavating��11A Calkain Companies �� 4C Capitol Aerials ��16B Cassidy Turley��5A Cenova ��BC-C Cervelli Management �� IC-B Cooper Horowitz �� IC-A Crystal Windows and Doors ..........................................................6B Earth Engineering �� 2C Eastburn & Gray��6A Eastern Union��3A Elias B. Cohen �� 4B Elliott - Lewis ��13B EnerSave ��15B Entech Digital Controls �� 9B Fowler ��19B Gerard Construction �� 6C GWS�� 3B Hammond Residential ��1A Hollenbach Construction �� 5B Hutchinson Mechanical��14B Integrated Business Systems...........................................................8B IREM �� 20-21B Jewel Electric��16B Jottan ��BC-B LEW Corp��16B LMS Commercial �� 2C M. Miller & Sons �� 3B Marcus & Millichap��BC-A Martin Architectural �� 5C NAI Keystone��10C NJAA ��19B NorthMarq Capital��7A P. Cooper Roofing��10B Philadelphia Auction Int’l �� 2A Poskanzer Skott Architects �� 2B Provident Bank��9A PWC �� 2B RD Management ��IC-1C Remco Realty Group��12A Rittenhouse Realty Advisors....................................................... 10A RT Environmental��13A Silbert Realty ��7C Specialty Building Systems�� 7B Subway ��11C Target Building Construction..........................................................2C Transwestern ��8A USGBC��16A Whitesell�� 4B

Mid Atlantic R eal E state J ournal Publisher ............................................................................ Linda Christman Publisher ............................................................................... Joe Christman Publisher/Senior Account Executive ................................. Elaine Fanning Section Publisher .................................................................... Steve Kelley Senior Editor/Graphic Artist .................................................Karen Vachon Production Assistant ....................................................................Julie King Office Manager .................................................................... Joanne Gavaza Guest Columnist .........................................................Jerry A. Nelson, Esq. 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. Rockand, MA 02370 USPS #22-358 | Vol. 26 Issue 18 Subscription rates: $99 - one year, $198 - 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

Jerry A. Nelson, Esq.

Landlord wins insurance payment due to lease

ood leases canhelpyou to achieve your goals. A landlord recently

won the right to an insurance payment. In the case In Re Amiel Restaurant Partners, LLC, 13-23866 (2014), theBank- ruptcyCourt awardeda landlord $358,800 in insurance proceeds because of the lease. The case involved a dispute over $358,800 in insurance pro- ceeds derived from personalty destroyed by SuperstormSandy at the restaurant premises which thedebtor leased fromthe landlord. The proceeds were es- crowedwithdebtor’sbankruptcy attorneyandboththedebtorand landlord claimed the proceeds in Bankruptcy Court. The issue in Bankruptcy Court was whether the landlord had an insurable interest in the debtor’s personalty to entitle the landlord to turnover of the insurance proceeds as an addi- tional insured. In order to decide the dispute between competing claimants to the same insurance

proceeds, the Court reviewed the lease. The Court found that it was key that the lease granted the landlord the right to recover the premiseswith its contents at the termination of the lease. The Court stated that the landlord anticipated deriving a “direct pecuniary benefit” under the lease which required the debtor to turn over to the landlord at the termination of the lease the premises “with all alterations, additions, improvements, fix- tures, trade fixtures, furniture, equipment and other property

utilized in connection with the operation of Tenant’s restau- rant, and such property shall become the sole property of Landlord in reasonable good repair and condition.” The Court further found that the landlord’s right under the lease to recover the premises with its contents at the termi- nation of the lease affords the landlord “a reasonable expec- tation of deriving pecuniary benefit from the preservation of the property” and therefore an insurable interest in property continued on page 14A

On sIte AuctIOns: 10/31/2014 At 1:00PM OPenIng BId: $500,000 (VAlue estIMAte $3.5 MIllIOns)

A llure G entlemAn ' s niGhtclub And liquor store for sAle 1075 n Albany Ave., Atlantic city, nJ 08401

Excellent location in Atlantic City on heavily traveled Albany Avenue adjacent to the Atlantic City Expressway and in close proximity to the casinos and the beach. A unique opportunity to own two (2) businesses and prime real estate comprised of a Gentleman's nightclub and liquor store in an excellent location. Situated on the waterfront on 1.5 acres in a building containing a total of 11,000 SF. The Gentleman's nightclub (BYOB) has approximately 6,000 SF and the liquor store contains 5,000 SF. Alcohol can be served in the adjacent liquor store with the potential to renovate into a sports bar. Liquor license is a Broad C license.

Contact us if you are interested in bidding for purchase Philadelphia Auction International www.paiauction.com 267-934-8345 | 267-639-4079

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M id A tlantic R eal E state J ournal Team structures loan covering 90% of the value EasternUnionFunding arranges financing for $4.6million building W ASHINGTON, DC — The Mid-Atlantic branch of Eastern

OCTOBER 7 TH & 8 TH AUCTIONS 12 New Jersey Statewide Opportunities

14.7+/- Acre Commercial Parcel on a Major Highway 9001 Route 130, Delran Township, Burlington County NJ 08075 In cooperation with Berkshire Hathaway Home Services 35,900+/- SF in 4 Separate Buildings on 5.11+/- Acres 82 E. Browning Road, Bellmawr, Camden County NJ 08031 12,400+/- SF Commercial Building with High Visibility 15 South Avenue (Route 28), Fanwood, Union County, NJ 07023 Additional Properties Include: Mixed-Use, Multi Family, Redevelopment, Commercial & Residential, Bank Ordered Sales

Union Funding, LLC , one of the country’s largest national commercial mortgage bro- kerage companies, arranged financing for the $4.6 million purchase of a northwest DC office building located at 1820 Jefferson Place NW in Dupont Circle. In addition to excellent terms, the team structured a loan covering 90% of the value for the client’s purchase, made possible by assembling the deal to minimize risk and maximize proceeds. The purchase was a year- long effort by Steven Kalifa, owner of Human Touch Home Health Care Agency. Kalifa also has a vast portfolio of properties in the Mid-Atlantic region, yet he received two unsustainable quotes from regional banks for the project, and, after a year’s worth of circle games, went to Eastern Union Funding. The five-year loan they ar- ranged was provided by a regional balance sheet lender and features a rate of 4.4%. The transaction was ar- ranged by Marc Tropp, Shai Romirowsky and David Merkin , all based out of the Eastern Union’s Bethesda, MD branch. “Our client wasn’t getting the proceeds he needed but we created security and a relationship which not only closed this deal, but will lead to many more,” Merkin said. “The structure we arranged with the lender took out a second posi- tion on another asset the client owned, enabling a 90 percent loan to value. Meanwhile, we created a life-long partner- ship between one of the top healthcare firms in the nation and a bank that could grow all aspects of our client’s business. The deal was one of a kind.” With the acquisition loan closed, Merkin and his team are in the process of the next phase. The 8,950 s/f office building, now occupied by Ka- lifa’s business, will undergo construction for a 15,000 s/f addition. “Eastern Union really came through for us,” Kalifa said. “Based on what I heard from the two banks I approached on my own, the deal wouldn’t have made sense, but the rate Eastern got us was phenom- enal and we’re working on two more deals.” n

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Eastern Union Arranged Financing For

• 10Year Term • Non-Recourse • Mixed-Use Office/Multifamily Railway Lofts, Baltimore, MD $9,800,000

Negotiated by MarcTropp 347-678-8491 Senior Managing Director Michael Obadia 202-617-3131 Vice President

over 20 years of Engineering Excellence

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M id A tlantic R eal E state J ournal By Robert Dietrich, MAI, CRE, Colliers International The Court reverses a reversal

Celebrating over 20 years of Engineering Excellence!

QUALITY • COMMITMENT • PERFORMANCE

ike appraisers, the Courts are subject to re- view. An appeals court

ment agencies. Tax Court rulings have helped to develop acceptable methodology in a number of valuation areas such as conservation easements, partial interest valuations, and other types of valuations. One case that is interesting in terms of precedent and IRS rules is Scheidelman case. This ruling by Judge Cohen in 2010 addressed the valuation of an historic preservation easement on a residential structure in Washington DC. In the case, the Court ruled that the ap- praisal that valued the ease- ment was not a qualified ap- praisal . The appraiser simply

HACKENSACK,NJ — NAI James E. Hanson announced that RandyHorning , a senior sales associate, has joined the company’s growing team. Horning brings seven years of commercial real estate sales experience to NAI Hanson. He comes to the company from LB Commercial Realty , where servedas abroker associateand assistant manager. Horning will be working closely with Darren Lizzack , an associate vice president, in the medical office arena. n NAI Hanson hires Randy Horning as senior associate 3. T.C. Memo. 2013-18UNITEDSTATES TAX COURT HUDA T. SCHEIDELMAN AND ETHAN W. PERRY, Petitioners v. COMMISSIONER OF INTERNAL REV- ENUE, Respondent - U.S. Court of Appeals for the Second Circuit, Scheidelman v. Com- missioner, 682 F.3d 189 n applied a 10% adjustment to the “before” value estimate the “after” value. The court ruled that the methodology was not acceptable under the regula- tions and denied the deduction. The taxpayers appealed the ruling to the Court of Appeals. The case was overturned and the appeals court ruled the report substantially complied and therefore was qualified. The issue was sent back to the Tax Court for a determination of value. This is where things get interesting. Judge Cohen of the Tax Court was required to accept the valuation report as a qualified appraisal. She then went on to determine value. In her ruling Judge Cohen ac- cepted the fact that the report was qualified per regulations as determined by the appeals court. However, she still did not find that the methodology was correct by the original ap- praiser or a second appraiser hired by the taxpayer who used the same methodology. The Court ruled that the easement had no value and denied the tax deduction for donation of the easement. The lesson learned from this case is to follow the require- ments of the IRS regulations to the letter. While it was seen by the Court of Appeals as adequate, it still failed the taxpayer in Tax Court due to improper methodology. 1. T.C. Memo. 2010-151 - United States Tax Court Huda T. Scheidelman & Ethan W. Perry, Petitioners V. Commissioner of Internal Revenue, Respondent 2. The term qualified appraisal is a technical definition under Section 170 of the Internal Revenue Code and includes a number of requirements.

can reverse a lower court, w h i c h i n turn can be reversed by the Supreme Court. Until a case reach- es the end of the line, the

Subsurface Investigations • Construction Inspection and Testing Geotechnical Design & Analysis • Environmental Site Assessments and Remediation • Clean Fill Testing • Carbonate Site Assessments Stormwater Infiltration Testing • Laboratory Soils Testing www.earthengineering.com Corporate Headquarters: 610-277-0880 • Lehigh Valley: 610-967-4540 Central PA: 717-697-5701 • South Jersey: 856-768-1001

Robert Dietrich

outcome can be in question. We have been taught that court precedence is important, especially when dealing with complex valuation assignments for the IRS and other govern-

QUALIFY TO ASSURE YOUR SUCCESS BEFORE THE IRS &COURTS

Attend the 2014 IRS VALUATION SUMMIT October 21, 2014—GrandHyatt inWashington, D.C. In Tax Court appraisals are too often rejected. How can you avoid having your work rejected by the IRS and the courts? Join US Tax Court Judges, IRS Appeals Officers, IRS Appraisers, Attorneys, CPAs, MAIs and other experts involved in Fair Market Values to learn answers and explore solutions. And, earn 7 hours for credentialing or licensing. Learn more: www.appraisalinstitutedc.org/summit

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R etail

By Scott C. Butler, Esquire, Kaplin Stewart Protecting rental income in the current market a longer and unexpected free rent period. Retail leases customarily and maintenance costs. Many tenants, however, are now very cognizant of costs and

ue to the previous expansion of retail stores and the in-

for a set additional rental amount or are negotiating fixed caps on all such costs and expenses. If these costs and expenses are higher than the set amount or cap, then the excess will decrease the amount of income that is being realized from the base rental amount. In the past, the common resolution has been for landlords to provide a cap only on certain expens- es, excluding non-controllable expenses such as taxes, util- ity costs, snow removal costs, insurance costs and taxes. Some tenants, however, have

been trying to cap such un- controllable expenses as well, thus passing the risk of these increased costs on to the landlord. Retail leasing in this econ- omy is still very competitive and landlords have to be very careful in order to protect the income that they are ex- pecting to receive from their leases. Scott C. Butler, Esq. is a principal in the Real Es- tate Transactions group of Kaplin Stewart in Blue Bell, Pennsylvania. n

c r e a s e d p r e s e n c e of internet sales, there r e m a i n s strong com- p e t i t i o n among land- lords for ten- ants to fill a v a i l a b l e

Retail leasing in this economy is still very competitive and landlords have to be very careful in order to protect the income that they are expecting to receive from their leases.

Scott C. Butler

have been negotiated on a “triple net” basis, meaning that the tenants bear most of the expenses of the lease including all taxes, insurance

are not willing to bear the risk of the unknown amounts for taxes, insurance and main- tenance costs. As a result, such tenants are negotiating

retail spaces. If a landlord has a desirable project with strong anchor tenants, there is a market for retail tenants to lease space; however, all tenants are cost conscious and are focusing on addi- tional rent and other costs in a lease. Most landlords and ten- ants focus on the base rental amount when negotiating a letter of intent and, in the event they are able to agree on this amount, they feel that a lease will be able to be signed. The base rental amount, however, is only one aspect of the rental income to be received from a lease. Landlords should focus on the construction costs, free rent, brokerage costs and additional rent if they want to truly realize a majority of the base rental amount as their income from the space. Construction costs, free rent and brokerage costs are all initial costs of a lease and will need to be amortized over the initial term in order determine howmuch income is part of the base rental amount. In order to protect against unexpected construc- tion costs, landlords should attempt to place a maximum amount on these costs either in the lease itself or in the construction contract with the general contractor for the build-out of the space. With regard to the amount of free rent being granted to the tenant, landlords should negotiate a set period of time after the delivery of the space to the tenant for the free rent period to expire and provide that, if the tenant opens for business earlier, the free rent period ends. Many tenants try to provide that the free rent period does not com- mence until after they have received their construction permits; however, landlords do not have any control over this date and this could cause

Firmly Rooted in the Law and in the Community We are well grounded in every facet of real estate law, from acquisition to construction. We are committed to serving the needs of our clients and our communities.

Contact: : Scott Butler • sbutler@kaplaw.com Visit our Construction Blog: www.pennsylvaniaconstructionlawyer.com Other Offices: Cherry Hill, NJ 856-675-1550 • Philadelphia, PA 215-567-3120 Kaplin Stewart A t t o r n e y s a t Law 910 Harvest Drive, Blue Bell, PA 19422-0765 • 610-941-2521 • www.kaplaw.com

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2014 - 2015 Conference Schedule

June

Mid Year Commercial Real Estate Forecast Summit Brooklake Country Club - Florham Park, NJ

August

The Utica Shale & Marcellus Economic Impact: Philadelphia Summit Llanerch Country Club - Havertown, PA

September 18

NJ Apartment / Mulitfamily Summit Brooklake Country Club - Florham Park, NJ

November 13

NJ Retail & Restaurant Summit

December

NJ Real Estate Capital Markets Summit

January

2015

NJ Medical Properties Summit

February

2015

NJ Office Summit

March

2015

NJ Land Development Summit

April

2015

NJ Senior Housing Summit

May

2015

NJ Industrial Real Estate Summit

June

2015

NJ Commercial Real Estate Forecast Summit

Linda Christman, Publisher/CEO Mid Atlantic Real Estate Journal Direct: 781-878-5298 lchristman@marejournal.com www.marejournal.com

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Discover the value of industry veterans, supported by an innovative platform, delivering new solutions to your most challenging real estate needs.

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C onstruction L aw By Robert R. Watson, Jr., Eastburn & Gray

Two key aspects of PA Mechanics’ Lien Law get statutory shake-up

n July 9, 2014, Penn- sylvania’s Governor Tom Corbett signed

mitted distant subcontrac- tors or suppliers to file lien claims where the general contractor failed to pay for their labor or materials used in improvements at a home. Just as the case was for the owner of a commercial build- ing, whether the residential property owner had paid her general contractor or not was of no concern under the state’s Lien Law. Absent a stipulation against liens prior to the start of work, the unpaid sub or supplier could proceed to threaten and file a lien claim if it had not been

paid for its portion of the construction, and it was the homeowner’s responsibility to make certain not only that the general contractor was paid, but also that appropri- ate funds trickled down to all of the general contractor’s subs & suppliers as well. In an attempt to prevent what some interested par- ties referred to as the unfair victimization of residential owners, PA Act 117 now pro- vides that where the owner or tenant in a residential property has paid the “full contract price” to the general

contractor, a sub or supplier may not proceed with a lien claim for the value of its improvements. If the resi- dential owner only paid the general contractor a portion of the balance due, the sub or supplier may file a lien, but the amount will be limited to the unpaid portion of the owner-GC contract. While the threat of me- chanics’ liens by subs or suppliers on a residential project have been a hard pill for homeowners to swallow, there is no doubt that the reputable sub or supplier

who supplies labor or mate- rials to improve a residence, but gets left holding the bag when a general contractor skips town or goes insolvent, will be left with additional headaches under these new revisions to the statute. Once again, it becomes im- perative for anyone working on a project in Pennsylvania to keep close tabs on receiv- ables and payment issues. An unintended result of this change may be that subs or suppliers move more quickly to place homeowners on no- tice where they sense pay- ment distress on the horizon. The second interest group directly benefitted by PA Act 117 is construction lenders. Two years ago, the state Su- perior Court held that unless 100% of the loan proceeds of an open-ended construc- tion mortgage went toward actual “hard” construction costs, as opposed to other common charges such as closing costs and satisfac- tion of prior mortgages, a mechanics’ lien could take priority in judgment enforce- ment proceedings. The Kes- sler decision represented a significant departure from common practice in the Com- monwealth under the statu- tory language of the Lien Law, and gave contractors, subs and suppliers further comfort in the enforceability in their payment claims. Following the passage of Act 117, the Pennsylvania Mechanics’ Lien Law now will state that an open-ended mortgage takes priority over lien claims if at least 60% of the funds are used to pay for construction costs. With the passage of this legislation, open-ended construct i on loans regain the “super-pri- ority” over lien claims which they had enjoyed in Penn- sylvania up until the 2012 Kessler decision. And, the comfort to contractors, subs and suppliers provided by that decision will be reduced. These amendments for- mally took effect on Septem- ber 7, 2014. Bob Watson has been practicing in construc- tion law for the last 14 years. He is a sharehold- er in Eastburn and Gray’s Blue Bell, PA office, and can be reached at rwat- son@eastburngray.com or 215-345-7000. n

Act 117 into law, amend- ing two sec- tions of that state ’ s Me- chanics’ Lien Law wh i ch have proven to be bones of contention to two separate interest groups. First, for realtors and resi- dential homeowners, up until now, PA’s Lien Law had per- Bob Watson

A tradition of legal excellence, since 1877.

The tradition of excellence at the law firm of Eastburn and Gray, P.C. began over 135 years ago and continues today. Our experienced attorneys provide high quality legal services throughout Pennsylvania and New Jersey. As a full service firm, Eastburn and Gray attorneys practice in many diverse areas of the law, enabling us to effectively meet the needs of all clients. To learn more about our firm, our work and our attorneys, please visit our website, www.eastburngray.com.

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NJ C ommercial R eal E state M arket By Matt McDonough, Transwestern New Jersey The Return of the Morristown/ Parsippany office market

new urgency has man- ifested itself as signifi- cant positive absorp-

the first half of 2014 alone. An anemic recovery from the 2008-2009 financial col- lapse sputtered through 2010, but due to the uncertainty in Washington and weak- ness in Europe, came to an abrupt halt in the summer of 2011. Demand remained non-existent through 2012 and into the summer of 2014. Spaces languished on the market. The longer a tenant waited, the better the deal he was able to negotiate. Aver- age vacancy periods stretched from 9 to 10 months to 14 to 18 months. Each prospect

conducted multiple site visits and seemingly endless techni- cal reviews. Lease negotia-

activity by a few big players and compounded by a lack of new or freshly renovated

In the fall of 2013, two large transactions by Merck started the dominoes falling. For the first time in years prospects negotiating for space were “bumped” by other prospects. After spending months negotiating on “their space,“ tenants suddenly found themselves scrambling for second choices. The closing of the Merck Headquarters in Whitehouse Station led a series of trans- actions in the Morristown/ Parsippany market. Merck Consumer Health took the IMS sublease of 120,000 s/f at 11 Waterview Blvd., allowing IMS to “right size” into 80,000 s/f at Interchange Park in Parsippany. Merck Animal Health also left Whitehouse Station and committed to a long term, net lease of 150,000 s/f of top shelf space from Maersk in the presti- gious Giralda Farms Center. That enabled Maersk, the Danish shipping company, to continue the decentralization of their U.S. headquarters operations, and consolidate into 70,000 s/f at 180 Park Ave., Florham Park. Suddenly, the mind set of “wait and see” shifted and the tenants throughout the market started stepping up. Fiserv and Factory Mutual quickly concluded negotia- tions and committed to 80,000 and 55,000 s/f respectively at 300 Kimball Dr. GAF Corporation purchased Cam- pus Drive to relocate their 377,000 s/f headquarters from Wayne to Parsippany. Sum- mit Financial and Drinker Biddle concluded renewal negotiations for 38,000 and 57,000 s/f respectively. The law firm Greenberg Traurig committed to a 60,000 s/f long-term lease on Campus Dr. in Florham Park. Smaller firms such as Schenk Price, Jackson Lewis, Pacira Phar- maceuticals, Alliant Technol- ogies, Insperity, Philadelphia Financial and U.S. Trust all stepped up for new leases or renewals in excess of 10,000 s/f. Although August has wit- nessed some of the usual slowdown of summer, sev- eral large transactions have kicked into gear as everyone returned in September. Matt McDonough serves as the managing director in Transwestern’s New Jersey office. n

tion in the Morristown/ Parsippany office mar- ket through the first half of 2014. Af- ter hosting negative ab- sorption of

“Although August has witnessed some of the usual slowdown of summer, several large transactions have kicked into gear as everyone returned in September.”

tions dragged on and became particularly acrimonious. There was no urgency in the market, and with no market forces pushing them, no deci- sions were made. Precipitated by a spurt of

space, there were suddenly too many tenants and too little truly top-quality space in the Morristown/ Parsip- pany market. In the game of musical chairs, the tempo was increasing.

Matt McDonough

1,160,000 s/f in 2012 and neg- ative absorption of 285,000 s/f in 2013 the market has seen a relatively healthy positive absorption of 700,000 s/f in

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matter the size) on solid ground.

400 Park Ave, 16th Floor, New York, NY 10022 300 Kimball Dr, 1st Floor, Parsippany, NJ 07054

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FastFinancing. Smart Solutions.

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$17,000,000 Multi-Family Rental Sayreville, NJ $26,000,000

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commitment you can count on. For more information, contact: Patti Patriarca, SVP patricia.patriarca@providentnj.com 732.726.5516

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ProvidentNJ.com

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10A — September 26 - October 9, 2014 — Fall Preview — M id A tlantic

Real Estate Journal

C ommercial C ontracting By Keith A. Brubacher, Brubacher Excavating, Inc. 10 critical questions to ask your contractor

he first question of- ten asked when se- lecting a contractor is

To help determine the con- tractor who will best position your project for success with- out surprises, ask these 10 critical questions. 1) How is your commitment to safety evidenced in your planning process and in daily work? Reputable contractors begin planning for safety at the very first pre-bid meeting. They ask insightful questions and are alert to surrounding factors that could affect the safety of their crews. Their daily actions demonstrate preparation to address these hazards.

their conduct and skill level? The men and women on the job should operate within the values of the company leaders, performing work in a way that reflects positively on the proj- ect owner and the company. There are big differences in the workmanship of team mem- bers who truly care about their work and those whose actions say “We’re just here to collect a paycheck...you can’t see how it looks from my house.” 5) What are your relation- ships like with municipal and regulatory authorities? Construction projects require

careful coordination between design and inspecting engi- neers, municipalities and reg- ulatory agencies. Since timely, on-budget completion depends on working well with third- parties whose interests may not be aligned, the project’s success can largely depend on personal interaction. Ignoring this can result in delays and increased costs. 6) Do you have the right amount of productive, reliable equipment available for the project? During the recession, many contractors ignored the ownership cost of their equip- ment when bidding projects. These contractors may have won a lot of cheap work that wore out equipment. Now they are in a poor position to keep it upgraded and reliable for today’s project demands. 7) Does your company have the team in place to proactive- ly manage the increased work- load of new projects? Many an owner has been unpleasantly surprised by delays after the contract is signed and crews gradually show up as they fin- ish other projects. 8) How will you ensure the project is completed on sched- ule? Describe the processes and people who will drive and communicate the project schedule. Delays can torpedo any project’s success by driving up the cost of services required to finish on time and deferring revenue for the project owner. 9) In your review of the con- struction plans, what opportu- nities have you discovered that may provide greater value or reduce cost? 10) What are the anticipated cost and schedule impacts if we encounter the items listed in your exclusions or alternate pricing? Contractors who are genuinely committed to your success will have already developed a plan for minimiz- ing these impacts during the proposal process. Solid answers that are veri- fied by references will help you select a contractor that reduces stress and manages risk on your next project. Keith Brubacher is presi- dent of Brubacher Excavat- ing, Inc. Brubacher serves the site, utility and energy construction markets with an uncommonly refreshing approach to people, projects andsolutions.Theirmissionis toshareinsight, reducestress andmanage risk for clients. n

2) What are your company’s results and experience on simi- lar projects? Many contractors attempt projects larger than they can successfully complete. Others are still trading on hallmark projects completed years ago before they elimi- nated key support resources in order to reduce costs. 3) What is your response time to questions and con- cerns? Timely communication helps to head off problems while they are small and easier to solve. 4) How does your team dem- onstrate professionalism in

“How much can you drop your price?” It is a dan- gerous ques- t i on when the answer is considered in a vacuum. Anyone can

Keith Brubacher

lower their price, yet the real questions remain: “At what cost to the success of my proj- ect?” and “What am I getting less of than before?”

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Real Estate Journal — Fall Preview — September 26 - October 9, 2014 — 11A

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1628 John F. Kennedy Boulevard | 8 Penn Center, Second Floor | Philadelphia, PA 19103

Since opening in February 2013

Our Sales Total Over $140,000,000 & 2,100 + Units

The Villas New Castle, DE 240 Units

Lancaster Court Wilmington, DE 320 Units

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Temple Portfolio Philadelphia, PA 116 Beds

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View our current listings on our website www.RittenhouseRealty.com

Domenick Peronti DE Broker of Record DE Lic. RB0020193

Richard Oller PA Broker of Record PA Lic. RM422315

KenWellar, Managing Partner ken@rittenhouserealty.com

Corey Lonberger, Managing Partner corey@rittenhouserealty.com

Mark Duszak, Director mark@rittenhouserealty.com

For more information visit www.RittenhouseRealty.com or call (215) 454-2852

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12A — September 26 - October 9, 2014 — Fall Preview — M id A tlantic

Real Estate Journal

R eal E state /B rokerage /M gmt .

By Peter Gallicchio, Remco Realty Group Company profile: Remco Realty Group

real estate market was head- ing into what was expected to be a lengthy correction period. We evaluated our op- tions and made the decision to stay the course and forge ahead, while competitors ei- ther closed their operations, or merged with others firms. The decision to forge ahead, or what most would refer to as a “gamble” paid off as Remco approaches its seven year anniversary. I would venture to say that 2008 through 2010 were lean years for everyone, but we managed to grind out

deals, while securing new marketing assignments, and expanding our market share.

grown beyond concentrating its efforts in a central geo- graphic area.

We continue to reinvest in our staff, as well as in tech- nology, and have recently launched a new and com- pletely re-designed website. Selected Remco transac- tions include; the leasing of 3,700 s/f to Enterprise Car Rental in Lodi, NJ, the leas- ing of 4,000 s/f to Sherwin Williams in East Hanover, NJ, the leasing of 6,300 s/f to Strauss Auto in Toms River, NJ, the leasing of 6,500 s/f to Napa Auto Parts in Bridge- water, NJ, the leasing of a former Checkers Restau- rant in Old Bridge, NJ to Dunkin Donuts, the sale of a free standing, 7,000 s/f for- mer Blockbuster building in Middlesex, NJ, the leasing of 3,200 s/f to Sherwin Williams in Hillsborough, NJ, the leasing of 4,000 s/f to Water Wizard in Flemington, NJ and the sale of the 55,000 s/f Hillsboro Club Plaza Shop- ping Center in Hillsborough, NJ. As we approach the close of 2014 and the start of 2015, we remain very optimistic re- garding the overall economy and the continued demand for retail real estate. The banks are lending again, consumer demand continues to climb, and same store sales are on the rise. Remco Realty Group is a comprehensive real estate brokerage and management firm, specializing in highway commercial and retail prop- erties. Our services include the sales and leasing of free standing buildings, liquor licenses, development sites, shopping centers, hotels, self-storage and investment sales. We provide tenant representation, along with site selection for national retailers, fast food, banks, and restaurant & daycare operators. “Repeat business is the benchmark of success for any services provider. Remco is committed to a long term strategy of providing our cli- ents with the highest level of professionalism, along with the most comprehensive mar- keting materials available. We strive to exceed client expectations by improving on our performance with every transaction.” Peter Gallicchio is the president of Remco Realty Group. n

emco Realty Group opened its doors in February of 2008 in

a ve r y r o - b u s t r e a l estate mar- k e t . C o n - sumer con- fidence was h i g h , a n d the economy was thr i v - ing. Our ex-

“As we approach the close of 2014 and the start of 2015, we remain very optimistic regarding the overall economy and the continued demand for retail real estate.”

The turn-around year for Remco was 2011, as we ex- panded our reach across the Delaware River by securing our brokers license in the Commonwealth of Pennsyl- vania. What started out as a local company, has now

Our hard work ethic and commitment to providing the highest level of account- ability to our clients has been rewarded, as landlords and retailers employ our services on a repeat basis, throughout multiple markets.

Peter Gallicchio

pectations for success could not have been any higher. Six short months later, the banks stopped lending, the economy tanked, and the

For Sale: Somerville, NJ 2,500 s/f Victorian Professional Bldg., on-site parking, corner lot @ traffic light, located one block from Somerset County Court House. Basement / Attic / Single passenger elevator. Ideal uses include; Law Firm, Title or Real Estate Agency, Doctor, Dental, Vision, or Medical practice, Accounting, Architectural, Engineering & Appraisal groups, Courier Service, Surveyor, Marketing & Public relations groups, etc.

For Sale: Branchburg, NJ 30,000 s/f two story free standing bldg., one loading dock, 145 car parking, 3.06 acres, 1,200 amps. Located in the Branchburg Corporate Center. Ideal uses include; Architectural, Engineering, Enviro., Marketing, Printing, Mechanical Contracting, Hi-Tech, Assembly, Lab., Research & Dev. Biotech, Pharmaceutical, Medical, Life Sciences, ConstructionMgmt., Professional Offices, Semi-Conductor, Specialty Chemicals, Educational, etc.

— Exceeding Clients Expectations — For more information, contact: Peter Gallicchio 732.253.0888 | pgallicchio@remcorealty.net www.remcorealty.net

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