This Week's Philadelphia Deal Sheet
Less than a week after securing key debt maturity extensions, PREIT has announced two milestones at one of its best-performing malls.
The Philly-based retail REIT has secured entitlements for the construction of a 460-unit apartment complex and a 165-room hotel on land surrounding the 1.3M SF Springfield Town Center mall in Fairfax County, Virginia. The permission paves the way for PREIT to close on the sale of that land to an unnamed developer, which already had put the parcel under contract.
PREIT also broke ground on the construction of a LEGO Discovery Center, a 32K SF indoor entertainment venue centered around the popular construction blocks. The center is projected to open in the middle of next year. Springfield Town Center is just under 90% occupied.
SALES
Velocity Venture Partners has purchased yet another property for its burgeoning industrial portfolio, although its latest acquisition won't require adaptive reuse. It has closed on the purchase of the 468K SF Yeadon Industrial Center at 6250 Baltimore Ave., just on the Yeadon side of Philadelphia's southwest border.
Velocity purchased the asset from Commonwealth Real Estate Investments for nearly $42M in November, according to Delaware County property records. Commonwealth Real Estate Investments is registered to the same Bala Cynwyd address as Commonwealth Capital, a local provider of short-term and bridge loans for commercial properties. The transaction was brokered by Cadence Real Estate Advisors and Avison Young.
Situated on 26 acres, Yeadon Industrial Center consists of one large warehouse building and a smaller outparcel building. It was 82% occupied by 17 tenants at the time of sale. The main warehouse was built in 1955, but with clearance up to 26 feet and a ratio of dock doors more befitting a newer vintage. Velocity intends to undertake some renovations, but is set to open leasing for spaces ranging from 5K SF to 150K SF.
LEASES
Keystone Development & Investment has signed financial services firm CBIZ to a 10-year, 51K SF lease at its 1K1 office building on the west side of Conshohocken, the Philadelphia Business Journal reports. The firm is relocating from a similarly sized office in Plymouth Meeting; it also maintains three offices in Center City and one in Media.
With the lease, the 255K SF building at 1001 Conshohocken State Road rises from 61% to 81% occupied, PBJ reports. Keystone purchased the building in 2019 when it was 55% leased and spent $12M on capital improvements. The developer also moved its own headquarters into the building.
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Vertical indoor farm operator Crop One Holdings has signed a lease to occupy a 316K SF build-to-suit facility in Hazle Township, Pennsylvania. International industrial developer PNK Group, which owns the 7-acre property, is targeting a 2024 opening.
Crop One was represented by Savills in the deal for what will be its second U.S. facility. When operational, the building is set to grow romaine and spring mix lettuces and employ 40 people at its location between Allentown and Scranton in Eastern Pennsylvania.
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CP Cases, a manufacturer of protective cases and equipment racks, has signed a lease for a 25K SF production facility and headquarters in Frankford, Delaware. CP is expanding from an 8K SF building in Maryland, with plans to grow its employee count from the current nine to 25. The company received nearly $200K SF in grants, most of which is based on its jobs promise.
The facility will be built at Frankford Business Park, owned by Martin Property Development and located along Route 113.
In further announcements from PREIT, a slew of leases have brought the REIT's leasing volume for the year to 23% above 2019 levels. Leading the announcement was a deal for apparel retailer Daily Thread to occupy space at nine different PREIT properties. Daily Thread's footprint extends as far as Paramus, New Jersey, and Southeast Pennsylvania spots like Lancaster and Bensalem, but it is focused in the Midwest and Great Plains regions.
Also joining PREIT's portfolio is a Uniqlo store at Cherry Hill Mall and a location for children's apparel retailer Carter's at the Springfield Town Center.
CONSTRUCTION
Delle Donne & Associates has begun preliminary construction on a 12-story, 150K SF mixed-use building at its Avenue North development district on Concord Pike in Wilmington, Delaware. Dubbed The Tower at Avenue North, the building will contain 100K SF of office space, including Delle Donne's new headquarters, and 50K SF of retail. JLL has been retained to manage leasing for the ground-up project.
The Tower has a projected completion date of March 2024, part of a new phase at the 79-acre Avenue North, which already houses headquarters for AstraZeneca and facilities occupied by ChristianaCare and specialty chemicals fabricator Solenis. Still to come are 460 apartments, four new streets and 10.5 acres of open space.
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The city of Philadelphia broke ground on $3M worth of improvements to the Cobbs Creek Nature Playground and Environmental Center in West Philadelphia. Funded by the city's Rebuild initiative, with assistance from the Fairmount Park Conservancy, the project will add amenities and newer play equipment to the playground and update both the roof and interior of the environmental center.
The work is expected to take just a few months, with completion targeted for the spring. The work is separate from the much more expansive, expensive and controversial redevelopment of the nearby Cobbs Creek Golf Course, which is still going through the approval process.
