Somerset Financial Center at 1405-1425 Route 206 in Bedminster — Courtesy: Cushman & Wakefield
By Joshua Burd
P3 Properties has made another addition to its New Jersey office portfolio, acquiring a 233,000-square-foot building in Bedminster that is home to a major pharmaceutical company.
Brokers with Cushman & Wakefield said Thursday that they represented Related Cos. in the sale of Somerset Financial Center, at 1405-1425 Route 206, for an undisclosed price. The recently upgraded, Class A complex houses the New Jersey headquarters of Mallinckrodt Pharmaceuticals, which produces specialty drugs such as generics.
The C&W investment sales team of Kevin Donner, David Bernhaut, Gary Gabriel and Ryan Larkin marketed the property and procured P3 as the buyer. The firm’s equity, debt and structured finance team, headed by John Alascio, Sridhar Vankayala and Zackary Kraft, arranged $42 million in senior financing through Rialto Mortgage Finance.
“We knew from the outset that this property would draw strong interest,” Donner said. “In locating there, Mallinckrodt took advantage of this property’s ‘pharma belt’ location, accessibility, surrounding highly skilled and educated labor pool to redesign Somerset Financial Center into a premier work environment.
“As an investment opportunity, it offered everything that a forward-looking owner/operator like P3 Properties appreciates.”
P3 plans to apply its BLUE management brand to Somerset Financial Center, which is near another one of the firm’s property interests at Somerset Corporate Center. That firm said that will allow it to use economies of scales as it expands its role in property management.
The firm has added several high-end suburban office buildings over the past year, including the Broadacres Office Park in Bloomfield and the former Morris Corporate Center III in Parsippany, now known as MCCBLUE.
“We approached this acquisition with the goal of diversifying our portfolio and adding another core asset,” said Harvey Rosenblatt, P3’s CEO. “The tenant’s in-place long-term lease provides stability and predictable cash flow, and we love the fact that the property is a wonderful work environment that reflects nearly $50 million in recent improvements.”
Mallinckrodt, which is growing rapidly via a series of acquisitions, signed a lease at the building in 2016. Bernhaut said the facility currently houses 480 employees at Somerset Financial Center and is seeking to further consolidate its operations there.
“Northern New Jersey represents the world’s largest concentration of pharmaceutical firms,” Bernhaut said. “Within this context, the I-78/I-287 Corridor in Somerset and Middlesex counties has always been a magnet for pharmaceutical development and research facilities. The Somerset Financial Center sale reflects the region’s continued appeal to tenants and investors alike.”
Rialto Mortgage Finance is providing a 10-year fixed-term, 10-year interest-only loan for acquisition financing.
