Allentown/Lehigh Valley submarket is one
that several space users are considering, says Jay Cornforth, the Boston-based
managing director of AMB’s East region.
In fact, Cooper is the latest name on a list
of companies, including BMW, that have
made the move west.
Though it’s a bit further from the Port
of New York and New
Jersey, he relates,
“the Lehigh Valley/I-78
Corridor leading to I-81
is a really good location.
A company can be in
New Jersey along the
turnpike, or they can
look to another regional distribution node for
the Northeast and mid-Atlantic, which falls into
The Lehigh Valley area. It really depends on
the company and its supply chain.”
While Cooper Tire is moving from one
AMB property to another, this wasn’t a
“done deal.” The firm’s brokers, Mohr
Partners, canvassed the market and put
out an RFP soliciting competing bids
from other landlords, explains Cornforth.
He adds that AMB beat out three to
four competitors for the requirement. CB
Richard Ellis represented the REIT in lease
negotiations.
The fact that Cooper Tire is an existing
customer, he says, “makes it a lot easier.
It was easy to negotiate a lease, because
we already had one in place in the New
Jersey facility.”
Set to move in early next year, Cooper
Tire is the first tenant at AMB’s I-78
Distribution Center. It will occupy over
half of the 700,000-sf warehouse at 8000
Quarry Rd. The rest of the space is being
marketed, and AMB has
the ability to add another
500,000-sf facility in a
later phase. The state-of-the-art development
has 162 tailgate dock
doors with a 32-foot
clear heights and 357
parking spaces. Built
from partially recycled
materials, the asset features such sustainable
elements as highly efficient insulation that
exceeds the ASHRAE requirements by
400% and T- 5 lighting, which reduces
energy consumption.
Cornforth would not disclose the terms
of the lease, but said it was “standard” for
the market with regard to length and rental
rate. According to a Q3 report from CBRE,
the average asking lease rate for the
Lehigh Valley was $4.55 per sf, triple net.
Comparatively, the Exit 8A submarket
in New Jersey, where Cooper Tire currently resides, had a third-quarter rate
of $4.91 per sf. While cost savings are
“ If a tenant needs to
be near the port, they’re
going to do so despite
the costs. JAY CORNFO”RTH AMB
a bonus, along with a friendlier climate
for doing business, Cornforth says that
doesn’t mean firms will automatically move.
“Companies are always rationalizing their
space needs and comparing New Jersey
to Pennsylvania,” he says. The issue for
space users is “how sensitive they are to
their location. If a tenant needs to be near
the port, they’re going to do so despite the
costs.”—Sule Aygoren Carranza
Sales
Leasing: Did You Know?
Cookeville, TN’s largest shopping center has added a new tenant to its roster. Food Lion Inc. will open a 37,000-sf
supermarket in 2009, after a $3.5-million renovation. The space is part of a 48,000-sf supermarket vacated a year
ago by BiLo; the rest of the footage is available for lease. A JV of Stonemar Properties LLC and Kimco Realty
Corp. bought the 355,000-sf asset last year…Biopharmaceutical company Gilead Sciences Inc. has inked a
deal for 106,000 sf at 199 E. Blaine St. within Seattle’s life sciences cluster. The firm has also committed to
another 4,000 sf, representing all of the office and lab space at the three-story building. Owned by Alexandria
Real Estate Equities Inc., the facility also includes some 5,000 sf of retail space…Nearly doubling its footprint
in the market, Bridgeport Education has taken all 248,000 sf of office space at the Sunroad Centrum Building
in the Kearny Mesa area of San Diego. The private education company will move into 10 floors of Sunroad
Enterprises’ 11-story building in two phases…For its first location in the Palm Coast, FL area, Hibbett Sports
has leased 5,000 sf in Palm Coast Landing, a 395,000-sf shopping center. Liberty Universal Management
represented the tenant in the deal with the landlord, Weingarten Realty. The store is scheduled to open in
February 2009…Opus West has signed the first tenant, KBC Advanced Technologies Inc., to its 240,000-sf
Energy Crossing I project. The firm struck a
10-year deal for 30,000 sf on most of the top floor
of the office building, one of two six-story, class A
structures that encompass the landlord’s Energy
Crossing I and II projects in Houston. CB Richard
Ellis acted for Opus in the deal, and Jackson
Kooksey represented KBC. The facility will be
ready for occupancy in February 2009…Under a
long-term lease, Brighton-Best International Inc.
will occupy 106,655 sf of Building K, a 365,760-sf
distribution center in the new LogistiCenter at
Logan in Logan Township, NJ. DP Partners owns
Sunroad Centrum Building the 1,000-acre, class A industrial park.
KENNEDY ASSOCIATES BUYS
VERIZON’S HQ FOR $192M
Boston—Verizon New England Inc.’s
headquarters, located at 185 Franklin St.
here, has changed hands for $192 million.
Seattle-based
Kennedy
Associates Real
Estate Advisors,
along with an
unnamed institutional partner,
purchased the
883,770-sf office
building from the
communications
company in a
185 Franklin sale-leaseback
transaction. The
tenant will retain ownership of 100,000
sf of space and continue to lease the
entire 22-story building under a short-term agreement. CB Richard Ellis advised
the seller, while the buyer used in-house
representation.
Kennedy Associates is planning to reposition the 60-year-old asset as a multi-tenant property, says Shobi S. Khan,
chief investment officer for the firm. “We
were looking for a value-add component,”
relates the Chicago-based executive. “Now
we have the opportunity to reintroduce this
building to the marketplace with a new
lobby and streetscape and upgrade it to a
B-plus asset.”
Khan says the approximately $100-mil-
lion redevelopment will get under way
in about two years, with a construction
timeline of roughly a year. Commonwealth
Ventures will manage the project. Plans
also call for the addition of 60,000 sf of
ground-floor retail that will open onto Post
Office Square.
Khan points out that the transaction did
have its challenges, such as “finding out the
right price point and the appropriate return
for taking on this kind of risk,” he says. “The
capital markets have been challenging, and
we also had a tax issue to resolve.”
