Here is a roundup of the latest leases, sales and other transactions in the Northeast middle markets.
This week by the numbers
As e-commerce claims an increasingly larger portion of holiday retail sales, retailers’ efficiency in limiting and handling returns of merchandise bought online – which could amount to as much as $32 billion this year – will make or break the holiday season for many, according to CBRE’s Philadelphia-based team.
E-commerce consistently generates more returns than brick-and-mortar retail, partly because shoppers often can’t sample online merchandise before buying it and partly due to the widespread practice of online shoppers ordering several versions of a product and returning those that don’t appeal.
Historically, returns of store-bought merchandise have amounted to eight percent of total retail sales. However, for e-commerce, that share ranges from 15 percent to 30 percent, depending on the product category.
Assuming those percentages hold true, the value of returns this season will increase by the same 13.8 percent that Adobe Analytics predicts for the increase in online sales this season. Adobe foresees online sales this season reaching $107.4 billion, up from approximately $93 billion last year. By extension, CBRE calculates that the projected ceiling for returns is $32 billion, up from roughly $28 billion last year.
“The increased amount of e-commerce returns will benefit Pennsylvania’s I-78/I-81 industrial corridor,” says Vincent Ranalli, senior vice president, CBRE. “We have a huge presence of 3PLs, public warehouses and reverse logistics firms in the area which are able to receive and process returned goods. In the past few years, we have witnessed shipping companies invest heavily to bolster their networks to accommodate the increased online traffic. Since the I-78/I-81 corridor is located within a day’s truck trip of 40 percent of the nation’s population, we believe the region will be an ideal location for returned online goods.”
Those well positioned to thrive in the online-returns market – also called reverse logistics – include third-party logistics firms and owners of 3PL facilities, according to CBRE. Many retailers opt to contain costs and preserve their retail focus by outsourcing reverse-logistics functions to 3PL firms that specialize in that field.
Deal Tracker Daily
NEW YORK, NY—Kamber Management Company has signed approximately 10,000 square feet of new office leases at Tower 45, a modern class-A office building in the heart of Midtown Manhattan. The 458,446-square-foot office tower was acquired by Kamber Management Company in September 2015. Steven Levy of Kamber Management Company and Mitti Liebersohn of Avison Young represented ownership in the transactions. Hedge fund StackLine Partners signed a three-year lease for 4,394 square feet on the 23rd Floor. StackLine Partners was represented by Stephen Gordon at Newmark Knight Frank in the transaction. Donohoe Talbert, a family law and commercial litigation firm, signed a ten-year lease for 4,725 square feet on the 19th floor. Donohoe Talbert was represented by Barry Spagna at Cresa in the transaction.
CANTON, MA—Calare Properties has acquired 15-21 University Road in Canton, MA. Situated at the juncture of Route 128 and I-95, this industrial/flex property is located in a prime in-fill market with high tenant demand, low supply and rising rental rates. The 103,200 square-foot property occupies 17 acres and features 14 loading docks, six drive-in docks, more than 300 parking spaces and flexible floor plans. The off-market acquisition was delivered vacant and presents a compelling value-add opportunity for Calare to upgrade the property and re-lease at market rates.
SECAUCUS, NJ—Hartz Mountain Industries is creating a dynamic live-work-play environment in Secaucus with The Harper at Harmon Meadow, a new luxury rental community rising within an existing mix of shopping, dining and entertainment. The Harper at Harmon Meadow will deliver a collection of 469 modern residences in three mid-rise buildings. Hartz Mountain has opened a temporary leasing office directly across from the community where prospective renters can visit to tour the model homes, preview information and visuals of The Harper’s spacious residences and resort-like amenities, and take advantage of pre-leasing opportunities.
NEW YORK, NY—RKF has arranged a 967-square-foot lease for City of Saints Coffee Roasters at 3 Bryant Park. The location, also known as 1095 Avenue of the Americas, is at the southwest corner of 42nd Street, in Midtown Manhattan. Opening in the first quarter of 2018, this will be the brand’s flagship location and its fourth location in the New York metro area. RKF managing director David Abrams and associate Emily Simmonds represented the tenant, City of Saints, in the transaction. Jones Lang LaSalle’s Matt Ogle, Corey Zolcinski, Erin Grace and Patrick Smith represented the landlord, Callahan Capital Properties.
VILLAGE OF PELHAM MANOR, NY—Construction is nearing completion on a new 38,000-square-foot 24 Hour Fitness health club at Post Road Plaza in the Village of Pelham Manor. The addition of this anchor tenant, set to open in mid-December, marks another significant milestone for the Westchester County retail destination. Levin Management Corporation of North Plainfield, NJ, serves as exclusive leasing and managing agent for the 268,000-square-foot Post Road Plaza. Levin leasing representative Jordan Korris negotiated the long-term 24 Hour Fitness lease. Jeff Lagowitz of Savills Studley represented the tenant.
HOBOKEN, NJ—Atlantic Environmental Solutions added four new staff members. AESI’s newest hires are (clockwise from top left): Lauren Zysling, project manager, with a background that includes more than 10 years of experience working on soil and ground water investigations in New Jersey; Meaghan DeCorso, a former AESI summer intern who returned to the company full-time as a staff environmental scientist; Richard Cerbone, P.G., senior manager, who has more than 35 years of direct experience in all facets of industrial property remediation; and staff environmental scientist Rebeca Garofalo.
HOWELL TOWNSHIP, NJ—Building on the highly successful Affiliate Broker Division it launched just two months ago, Eastern Union Funding has announced the launch of its newest initiative: the Affiliate Buyer Division. The division will be led by Simcha Greenwald (pictured). Working with these newly formed broker relationships, the Affiliate Buyer Division presents an extensive array of listings to both strengthen existing relationships with current clients and assist in bringing in new ones. With this new service, any client of Eastern will be able to log onto the Eastern Union app, fill in their buying criteria, including area and property type of interest, and receive a personalized daily email including all corresponding listings. As the app is further developed, clients will gain the ability to view listings within the app with an increased ease; simply swiping left or right to either receive more information or to choose to pass.
MONTICELLO, NY—Empire Resorts named Jamie M. Sanko (pictured) as its Chief Accounting Officer, and appointed Kevin D. Kline chief operating officer and general manager of Resorts World Catskills. Sanko has nearly 20 years of accounting and finance experience. Most recently, he served as chief financial officer of Genting Americas, and was responsible for the financial oversight of casino and resort properties located in New York, including Resorts World Casino New York City, Miami, Bimini and Las Vegas. Kline has 25 years of experience in the gaming industry, most recently as senior vice president and general manager of the Horseshoe Casino Cincinnati, overseeing the development and operations of the $450 million casino in downtown Cincinnati.
HOLMDEL, NJ—Somerset Development named attorney and real estate industry veteran Robert Feinberg director of operations. Feinberg will oversee the company’s residential and mixed-use development initiatives, including Bell Works, the adaptive-reuse initiative transforming the two-million-square-foot Bell Laboratories located in Holmdel, NJ. Feinberg will serve as the liaison between all external partners, organizations, agencies and Somerset’s executive team and president, Ralph Zucker.
HARDING TOWNSHIP, NJ—Kimmerle Group, a Harding and New York City-based design, real estate planning, development and branding practice, promoted two senior associate/senior project managers to principals. William J. Kimmerle, AIA (left) and X. “Cindy” Cui, AIA, bring demonstrated leadership and extensive experience across a broad range of projects to their new roles. William Kimmerle joined KG in 2010 and contributes a leading voice to the firm’s medical, corporate, institutional and nonprofit practices; spearheaded the expansion of the firm’s procurement practice, Workspace; and leads the firm’s New York City division, Urban Studio. Cui is a LEED-accredited professional who specializes in new construction, major renovations and has led KG in finishing several LEED buildings.
PHILADELPHIA, PA—The Delaware Valley Green Building Council, a nonprofit education and advocacy organization working to enhance sustainability and the built environment has joined forces with the local Living Building Challenge and Passive House communities under a new name, Green Building United, to reflect its community of committed practitioners, passionate advocates and dedicated volunteers.
Correction, 12/20/2017, 11:53 a.m.: Because of an editing error, an earlier version of this roundup omitted a listing of brokers involved in the City of Saints leasing transaction.