This Week's Philadelphia Deal Sheet
Despite considerable softening in leasing providing a headwind to speculative development, a major spec warehouse in the Lehigh Valley has found a tenant.
French third-party logistics operator ID Logistics has agreed to lease a 527K SF distribution center in the Lehigh Valley Trade Center, a multiphase industrial park being developed by a joint venture of Trammell Crow Co. and Clarion Partners in Bethlehem, Pennsylvania. A Colliers team of Mark Chubb, Michael Zerbe and Summer Coulter represented the JV in the transaction.
ID Logistics, which entered the U.S. market in 2019, will operate the facility on behalf of a global food company. With over 1M SF developed, the Lehigh Valley Trade Center will now turn to its next phase, which includes the construction of two distribution centers, one 300K SF in size and the other 288K SF.
PEOPLE
Pennovation Works, the University of Pennsylvania-associated tech and life sciences campus in Grays Ferry, has named a new leader. Denita Henderson, a UPenn alumna who comes from the world of business consulting, will serve as managing director, overseeing both the management of the existing 180K SF campus and the development of future phases at the site.
The most notable and most imminent of those future phases is a 437K SF research and biomanufacturing facility, the development of which will be led by Longfellow Real Estate Partners for the national developer's first Philly project. A groundbreaking date has not been set, but late 2025 is the target for opening. At full build-out, Pennovation Works could total as much as 1.8M SF.
SALES
National auto dealership investor Piazza Auto Group has acquired the Ferrari Philadelphia property on Lancaster Avenue in the suburb of Bryn Mawr, at the heart of the Main Line's commercial corridor. PAG's acquisition includes the four-story, 36K SF showroom and auto service center and a single-story, 5K SF repair center across the street. An affiliate of locally based RDS Automotive sold the property in a transaction arranged by Colliers Senior Vice President Rich Weitzman.
CONSTRUCTION
Two major multifamily projects have broken ground on opposite ends of an underdeveloped pocket between Northern Liberties and Old City. At the start of November, National Real Estate Development began construction on a 13-story, 360-unit apartment building at 200 Spring Garden St., which will have a 5.4K SF City Fitness on the ground floor.
It is the first piece of what National anticipates will be a $500M project that adds a meaningful level of density along Second Street between Spring Garden and Callowhill streets, the Philadelphia Business Journal reports. Kushner Real Estate Group is an equity partner on the overall project.
At Fifth and Callowhill streets, Pittsburgh-based Linden Street Investments has broken ground on an $80M, 220-unit apartment building, its first in Philly, PBJ reports. Outlook Development Group of Milwaukee is an equity partner on the project, which has a construction loan from Old National Bank.
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Post Brothers broke ground this week on a two-building multifamily complex at Poplar and Darien streets in the neighborhood just to the west of Northern Liberties, sometimes referred to as Poplar, Rising first reported and Bisnow can confirm. The two buildings will both stand five stories tall and contain 212 apartments between them. Each is slated to contain ground-floor commercial space.
The project sits just on the other side of an elevated regional rail line from the Poplar, a mixed-use redevelopment of a former factory that Post Brothers completed in the past couple of years.
Pennrose has broken ground on the first phase of redevelopment of the Little Lehigh affordable housing complex in Allentown, Pennsylvania, demolishing nine 50-year-old buildings and replacing them with a 50-unit, five-building, 63K SF complex of low-rise apartment buildings and a 3.2K SF community center.
The first of the two-phase project is expected to be completed by the end of next year and is financed by a long mix of local, state and federal grant and loan programs, including American Rescue Plan money allocated by Pennsylvania's Department of Economic and Community Development.
In addition to being income-restricted, Little Lehigh's first phase will be attached to 25 project-based vouchers from the Allentown Housing Authority, which is also contributing some of its own funds to the project's construction. Hudson Housing Capital served as the project's syndicator and Santander Bank served as the investor for some of the funding vehicles, such as Low-Income Housing Tax Credits, used for the project. Santander also provided separate construction financing to Pennrose for the project.
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RD Management has broken ground on a 136K SF Home Depot in the Allentown suburb of Trexlertown, Pennsylvania. The store is the first component and anchor tenant for RD's 182K SF shopping center development on the site, to be called Macungie Crossing. Further leasing at the site will focus on food service, with footprints ranging from 3K SF to 20K SF. The Home Depot, which will include a garden center, is scheduled to open in the summer.
