Ensemble Makes First Philly Play Outside Of Navy Yard, Buys 2 Wayne Office Buildings

Ensemble Real Estate Investments may be based in Long Beach, California, but its latest acquisition represents a homecoming for its local leadership team.

Ensemble purchased two office buildings in the King of Prussia submarket totaling 204K SF from Prologis for an undisclosed price in a transaction that closed Wednesday. The two buildings sit at 650 and 680 Swedesford Road, less than 2 blocks from the King of Prussia Mall.

Prologis owned the two buildings as a result of its 2020 acquisition of Liberty Property Trust, which had renovated 650 Swedesford in 2018 and located its headquarters there before the merger. The building is now 75% occupied by other tenants. 

Since a full-building tenant departed 680 Swedesford in 2021, the 102K SF building has sat vacant, and Ensemble plans to undertake an extensive renovation to match its neighbor.

Ensemble Senior Vice Presidents Mark Seltzer and Brian Cohen are both former Liberty executives who worked on the 650 Swedesford renovation — then worked in the building itself. The duo views a renovation of 680 Swedesford as unfinished business from their time at Liberty, Seltzer told Bisnow.

“We know the buildings, we know the market and we know the tenants [in the market],” Seltzer said.

Ensemble obtained a loan from Pittsburgh-based TriState Capital Bank to finance its acquisition, arranged by a CBRE debt and structured finance team. Seltzer declined to give specifics of the loan but said there are no other equity or debt partners involved in the capital stack.

"The feedback we got [from TriState] was, ‘Hey, it’s a local sponsor who has been able to execute, and you’re talking about the best buildings in the best market,'" Seltzer said. "That would not be the case with vacant buildings in high-vacancy areas with worse locations. The debt market is incredibly challenging, if not impossible, in those areas.”

A joint venture of Ensemble and Mosaic Development Partners succeeded Liberty in charge of new development at the Philadelphia Navy Yard. Backed by Oxford Properties Group as equity partner, Ensemble has snapped up as much of what Liberty built on the campus as it can.

Seltzer and Cohen's combined experience from when Liberty was the master developer at the Navy Yard was central to Ensemble's entry into the Philadelphia market. 

Ensemble owns four multitenant office buildings at the Navy Yard, three of which are fully occupied. The fourth has only a 2,500 SF office vacant. The continued leasing success of the Navy Yard through the pandemic is part of what gave Seltzer and Cohen the confidence the Swedesford properties can overcome the negative perception hanging over the asset class in general.

“Mid-rise buildings have been popular," Seltzer said. "People don’t want to be 25 stories up in the air. They want to drive themselves to work, want to be able to take a nice walk outside and get light in their buildings, and that’s been sort of the secret sauce.”