600 Delran Pkwy. in Delran — Courtesy: Endurance Real Estate Group LLC
(Editor’s note: This story has been updated with the addresses of the properties and a quote from CBRE.)
By Joshua Burd
An investment group has closed on its purchase of seven industrial buildings in Burlington and Gloucester counties, acquiring the portfolio for just under $43 million.
The buyers, an affiliate of Endurance Real Estate Group LLC and PCCP LLC, on Monday announced their purchase of the 553,548-square-foot portfolio in Swedesboro, Delran and Mount Laurel. The portfolio is currently 88 percent leased to 22 tenants, with anchors including Food Sciences Inc., Carnegie Pharmaceuticals LLC and The Jewelry Group Inc.
The CBRE team of Michael Hines, Brad Ruppel, Brian Fiumara and Lauren Dawicki represented the seller in the $42.925 million transaction.
“The infill nature of the portfolio combined with the established core tenancy and staggered lease expirations was consistent with our long-term investing strategy in well-located submarkets,” said Jared Newman, Endurance’s vice president of acquisitions. “Endurance is excited to have completed our first transaction with PCCP.”
The portfolio includes 600 and 601 Delran Parkway in Delran, 820 East Gate Drive and 116 Gaither Drive in Mouth Laurel and 603 Heron Drive, 614 Heron Drive and 1 Killdeer Court in Swedesboro. Each of the portfolio’s assets are positioned within 1.5 miles of Interstate 295, the New Jersey Turnpike or Route 130.
“The sale of the Southern New Jersey Infill Portfolio is emblematic of the integral role of highly functional, infill warehouse/distribution buildings proximate to Interstate 295, US Route 130 and the Philadelphia bridges to the region’s logistics network,” said Ruppel, a senior vice president with CBRE. “Projectable income from entrenched core tenancy, enduring high flow-through functionality and leasing upside made this an extremely attractive opportunity to capitalize on the continued evolution of the New Jersey industrial corridor.”
In a news release, the buyers touted the portfolio’s location along the Turnpike and its access to the Philadelphia and New York metropolitan areas. They added that Burlington and Gloucester counties are mature infill markets, with CBRE reporting vacancy rates of 5.4 percent and 6.2 percent, respectively.
Over the trailing three years, the average asking rent for South Jersey’s light industrial inventory has increased by more than 31.6 percent, Endurance said. The Radnor, Pennsylvania-based firm also pointed to a severely limited number of industrial-zoned sites near interstates and bridges, combined with a protracted multiyear approval and entitlement window and surging tenant demand, which has pushed asking rents for newer space into the high $5 range.
The joint venture has tapped Scott Mertz of NAI Mertz as its leasing agent for the portfolio. Current availabilities include the full-building availability of 57,930 square feet at 601 Delran Parkway and 5,000 square feet at 614 Heron Drive in Swedesboro.
“The assets’ proximity to (Interstate 295) and the greater Philadelphia metro area, coupled with the continued long-term tailwinds for light industrial product in high barriers to entry markets like southern New Jersey make this a very attractive investment,” said Benjamin Cohen, Endurance’s president.