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Keystone, Mack-Cali Buy Curtis Center In Philadelphia for $125 Million In Cash
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Keystone Property Group and
Mack-Cali Realty Corp. plan to reposition the iconic Curtis Center office building in Philadelphia as a mixed-use development featuring
90 luxury apartments.
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PHILADELPHIA -- Keystone Property Group and Mack-Cali Realty Corp. (NYSE: CLI) have jointly purchased Curtis Center, a Class A office and retail building overlooking Independence Hall and Washington Square Park in Philadelphia's Center City, for $125 million. The companies acquired the building in an all-cash transaction, and plan to redevelop the property into a mixed-use development consisting of luxury rental apartments, office space and an outdoor pedestrian experience.
Curtis Center totals approximately 885,000 square feet and comprises a city block. Current tenants include the General Services Administration and several ground-floor retailers. Keystone and Mack-Cali plan to convert approximately 90,000 square feet of office space in the building into 90 luxury rental apartments.
"Not only is Curtis Center rich with cultural importance, but it's also perfectly aligned with our company's overarching goal to expand our regional footprint by creating exciting live-work-play spaces in dynamic markets," says Bill Glazer, president of Keystone Property Group. "We're thrilled to have the chance to transform this icon into a vibrant mixed-use environment, while maintaining the historical significance of one of Philadelphia's most recognizable buildings."
A redeveloped Curtis Center will also feature new corner restaurant spaces with frontage on Walnut and Sixth streets, as well as outdoor seating and views of both Washington Square Park and Independence National Historical Park.
Keystone and Mack-Cali plan to complete capital improvements to the property, including upgrades to the elevators and renovation of the building's HVAC system, roof, facade and parking garage.
An affiliate of Keystone will manage the office and retail portions of the building, while Roseland, a subsidiary of Mack-Cali, will be responsible for the design, construction, leasing and management of the luxury apartments.
Curtis Center originally housed Curtis Publishing, owner of publications such as Ladies' Home Journal, The Saturday Evening Post, Jack & Jill and Country Gentleman.
Keystone Property Group is a real estate investor and developer founded in 1991 with offices located in Bala Cynwyd, Pa.; Miami, Fla.; and New York.
Mack-Cali is a self-administered, self-managed real estate investment trust. Mack-Cali owns or has interests in 280 properties, including 267 office properties totaling approximately 31.6 million square feet, and 13 multifamily rental properties containing approximately 3,900 residential units, all located in the Northeast.
The stock price of Mack-Cali closed at $21.92 per share on Wednesday, June 11, down from $24.78 per share a year ago.
-- Scott Reid
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Woodmont Properties Opens 126-Unit Woodmont Knolls At Hanover
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 | The 126-unit Woodmont Knolls at Hanover along Cedar Knolls Road
in Hanover is more than 60 percent pre-leased. |
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HANOVER, N.J. -- Fairfield, N.J.-based Woodmont Properties has opened Woodmont Knolls at Hanover, a luxury apartment community situated on a 15-acre former industrial site along Cedar Knolls Road in Hanover. The property, which is more than 60 percent pre-leased, features 126 one- and two-bedroom flats and carriage homes.
Community amenities include a clubhouse with sports bar and gaming system, strength and cardio center, billiards room, cyber caf�, dog park, picnic and barbeque area, and a swimming pool with a sundeck. Additionally, the community's 15-acre setting includes walking paths and green space that runs along the Whippany River and has direct access to the historic Patriots Path, a 35-mile multi-use nature trail operated by Morris County, N.J.
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Tryko Partners Adds Five Skilled Nursing Assets To Portfolio |
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The 87-bed Valley Stream Rehabilitation and Healthcare Center
in Fitchburg, Mass., is one of the recently purchased assets.
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BRICK, N.J. -- Brick-based Tryko Partners LLC has added five skilled nursing facilities, totaling 470 beds, to its Massachusetts portfolio. The company has acquired two properties from Ventas Inc. and entered into a lease contract to operate three additional assets that Ventas will continue to own.
Tryko acquired the 88-bed Hammersmith House Nursing Care Center, which will be renamed Chestnut Woods Rehabilitation and Healthcare Center, in Saugus, Mass.; and the 87-bed Hillcrest Nursing and Rehabilitation Center, which will be renamed Valley Stream Rehabilitation and Healthcare Center, in Fitchburg, Mass.
The Ventas-owned properties to be operated by Tryko include the 132-bed Blueberry Hill Skilled Nursing and Rehabilitation Center in Beverly, Mass.; the 82-bed River Terrace Rehabilitation and Healthcare in Lancaster, Mass.; and the 81-bed Oak Wood Rehabilitation and Nursing Center, which will be renamed Brookside Rehabilitation and Healthcare Center, in Webster, Mass.
The PrivateBank provided financing for the two acquisitions. Tryko is financing working capital for the three Ventas-owned properties through a regional bank with extensive healthcare lending experience.
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240-Bed Nursing Home Facility Sells
For $20.5 Million In Butler | |
BUTLER, PA. -- Institutional Property Advisors (IPA), a brokerage division of Marcus & Millichap, has brokered the sale of Sunnyview Nursing and Rehabilitation Center in Butler. A Northeast-based healthcare property investment firm purchased the 240-bed nursing home from Butler County, Pa., for $20.5 million. Built in 1963, the property is situated on seven acres at 107 Sunnyview Circle. Joshua Jandris, Mark Myers and Charles Hilding of IPA, along with Matthew Gorman of Marcus & Millichap's Philadelphia's office, represented the seller in the transaction.
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Northmarq Arranges $34.4 Million Loan For 238-Unit Multifamily Property |
 | | John M. Corcoran & Co. and Guardian Life Insurance Co. own the 238-unit Parkside Commons Apartments in Chelsea, Mass. |
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CHELSEA, MASS. -- NorthMarq Capital's Boston office has secured a $34.4 million refinance loan for Parkside Commons Apartments located at 100 Stockton St. in Chelsea. The 238-unit multifamily property is owned by John M. Corcoran & Co. and Guardian Life Insurance Co. and managed by Corcoran Management Co. Inc. James Murphy of NorthMarq arranged the transaction, which is structured with a seven-year term with five years of interest-only payments.
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Friedman-Roth Realty Services Brokers $11.1 Million Mixed-Use Sale
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NEW YORK CITY -- Friedman-Roth Realty Services has brokered the sale of two adjacent four-story buildings in Midtown East for $11.1 million. Located at 988 and 990 Second Ave., the 9,180-square-foot, triple-net leased properties feature five residential apartments and a sushi restaurant. Jim Mann and Lily Ren of Friedman-Roth represented the buyer, a private investor, and Richard Libbey of M.A. Salazar represented the seller, a longtime family investor, in the transaction.
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GFI Brokers Three Brooklyn Apartment Sales Totaling $3.6 Million | |
NEW YORK CITY -- GFI Realty Services has brokered the sales of three walk-up apartment buildings in Brooklyn totaling $3.6 million. In Brooklyn's Bedford Stuyvesant neighborhood, the four-story, 13-unit 920 Madison St. sold for $1.4 million. The four-story, seven-unit 1463 Bedford Ave. traded hands for $1.2 million in Brooklyn's Crown Heights. Additionally in Crown Heights, 1130 St. Johns Place, a four-story, eight-unit building, sold for $960,000. Shlomo Antebi of GFI Realty Services represented the sellers and buyers in all transactions.
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Houlihan Parnes Arranges $2.9 Million In Loans For Bronx Retail Properties | |
NEW YORK CITY -- Houlihan Parnes Realtors has placed $2.9 million in first mortgage debt for three retail properties in the Bronx. The one-story buildings, which total 14,000 square feet, are located at 26-34 W. Kingsbridge Road, 134-138 W. Fordham Road and 1735-1745 University Ave. The three separate loans have five-year, 3.75-percent fixed rates with 30-year amortization schedules. Additionally, the loans feature flexible terms and extension options. Jerry Houlihan arranged the financing, while Elizabeth Smith of Goldberg Weprin Finkel Goldstein represented the borrowers.
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TerraCRG Sells Red Hook Industrial Property For $1.9 Million
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NEW YORK CITY -- TerraCRG has brokered the $1.9 million sale of an industrial portfolio located at 12-18 Commerce St. in Brooklyn's Red Hook neighborhood. The irregular-sized lot, 107-by-100 feet, comprises five buildings totaling approximately 8,024 square feet above grade, and a shared courtyard of 966 square feet on the interior of the lot. Ofer Cohen, Melissa DiBella, Dan Marks, Peter Matheos and Michael Hernandez of TerraCRG arranged the transaction between two private investors.
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Transportation Projects, Shale Activity Drive Pittsburgh's Industrial Demand
By John Bilyak, Anthony Pantoni, Patrick Tracy
and Raymond Orowetz of Colliers International
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Left to right: Anthony Pantoni, Patrick Tracy, John Bilyak
and Raymond Orowetz.
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PITTSBURGH -- In Pittsburgh's industrial market, the fourth quarter of 2013 finished in much the same way it began and maintained throughout the year -- solid if unspectacular growth. The vacancy rate fell from 7.9 percent in the third quarter to 7.7 percent in the fourth quarter and dropped three basis points in total over the course of the year. The lack of quality Class A warehouse space continues to be a factor with vacancy levels dropping to an astounding 2.97 percent.
The greater Pittsburgh's industrial market is approximately 172 million square feet spread out over the six-county region that includes Allegheny, Butler, Beaver, Westmoreland, Washington, and Armstrong counties. The Class A portion is approximately 17.5 million square feet.
With a vacancy rate of 2.97 percent, we only have a total availability across our total market of 519,750 square feet of Class A product. This is below equilibrium for a healthy market. Furthermore, the definition of Class A product in the Pittsburgh region would not necessarily hold up in markets with more speculative developments such as Columbus, Ohio or Lehigh Valley.
Although Pittsburgh has hit the radar of the national real estate community for the opportunity on the investment side, we are still very much a secondary market.
Positive Story Lines
"Optimism" is the word for 2014. Investors should be especially bullish on Pittsburgh given the multitude of factors that should positively affect the industrial market. These story lines include CSX's announcement that it will construct a $50 million multi-modal facility in McKees Rocks, the continued expansion of the Southwest Pennsylvania energy sector and the much-needed passage of the State Transportation Bill. Any of these factors alone is significant but, taken in total and combined with the positive national dynamics, these factors ensure that the region will continue to advance forward.
The investment being made by CSX is evidence that it considers Pittsburgh to be a player in the inland intermodal supply chain. The McKees Rocks project will entail the renovation of the former Pittsburgh and Lake Erie Railroad site, which operated for more than 100 years. This project is part of CSX's National Gateway project. The Gateway project is an $850 million public-private partnership to create a highly efficient and environmentally friendly double-stacked clear rail corridor on the CSX network between the Mid-Atlantic and the Midwest.
According to Michael J. Ward, chairman, president and chief executive officer of CSX, "The facility will create more economic opportunity for residents and significantly enhance distribution opportunities for businesses."
The other critical component of the intermodal trifecta is highway infrastructure. While Western Pennsylvania still has our windmills to tilt with respect to our highway system, we took a huge step in the right direction with the passage of House Bill 1060 in November 2013. The State Transportation Bill will infuse $2.3 billion to $2.4 billion of sorely needed funds into road and bridge projects across the state of Pennsylvania. This will lead to the repair of aging infrastructure and the avoidance of road closures and weight reductions on bridges, as well as the start of new projects.
The most high-profile of these projects is Phase II of the Mon-Fayette Express Way/Southern Beltway. This 13.3-mile stretch of highway will connect Phase I, which travels from the Pittsburgh International Airport to Imperial (Route 22) and then runs south into Washington County, ultimately connecting to I-79. For a region without a conventional beltway (and no, red, yellow, blue, and green do not count), this is a much-awaited announcement.
Unfortunately, the news is not all positive with the third key element required for intermodal transportation. Our nation's system of locks and dams is collectively in poor condition, given that 52 percent have eclipsed their designated life expectancy of 50 years. Nearly 45,000 loaded barges carrying more than 66 million tons of material, valued at $5.6 billion passed through district locks in fiscal year 2012.
The funding for replacement and rehabilitation is piecemeal and results in continued construction delays and cost overruns. The expansion of the Panama Canal portends great opportunity to inland ports in the Tri-State region, provided the material can navigate the lock systems.
Recent Transactions
Deals of significance in the fourth quarter included Trufood's (formerly Tsudis Chocolate) lease of 155,000 square feet at 106 Gamma Drive in RIDC O'Hara, the sale at 3000 Grand Ave. (60,000 square feet) on Neville Island; and the sale at 19 35th St. (40,000 square feet) in the Strip District.
On the land side, Paragon USA purchased 13 acres on 62nd Street from the URA with plans to build a new food distribution warehouse. The Pittsburgh Post-Gazette announced during the first quarter that it will move its printing operation to the 240,000-square-foot former Flabeg Solar building at the Clinton Commerce Park. Flabeg exited the building three years after taking occupancy and hiring 300 employees. This is good news for the region, but offers further evidence that supply is tight when a building is scooped up prior to formally coming to market.
The Road Ahead
The future of the industrial market looks bright. Disruptions are inevitable, but companies will continue to look to Western Pennsylvania as an area of growth. The shale boom has created a cottage industry for not only the drillers and gas suppliers, but also for companies that benefit from participating within the mid- and downstream markets.
Demand for quality warehouse/distribution space will continue to outstrip supply, and hopefully lead to additional speculative development. By not offering market-quality options for incoming companies to set up shop or for existing businesses to expand, the region risks opportunity loss to neighboring industrial markets that offer better options.
This article first appeared in the May 2014 issue of Northeast Real Estate Business magazine.
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Real Estate Opportunity and Private Funding Investing Forum
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Overview: The 15th annual U.S. Real Estate Opportunity and Private Fund Investing Forum.
When: June 12-13, 11 a.m. to 6 p.m.
Where: Marriott Marquis, 1535 Broadway, NYC
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Residential Ethics Course
for New Members
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Overview: Required non-credit course for new REBNY members. Registration is required.
When: June 24, 9 a.m. to 10:30 a.m.
Where: REBNY Mendik Education Center, 570 Lexington Ave. (Lower Level), NYC
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Certified Negotiation Expert Course
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Overview: Sponsored by REBNY, the two-day course is for real estate professionals looking to obtain CNE certification or continuing education credits.
When: June 25-26, 9 a.m. to 5:30 p.m.
Where: REBNY Mendik Education Center, 570 Lexington Ave. (Lower Level), NYC
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Contact us
Matt Valley, Editorial Director Northeast Real Estate Business France Media, Inc. 404-832-8262 404-832-8260 northeast@francemediainc.com www.rebusinessonline.com |
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