Suburban Berks County Office Report – 3Q16

Suburban Berks County Overview – End of 3rd Quarter 2016

The Greater Reading Suburban Office Market ended the 3rd Quarter 2016 with a vacancy rate for Class A Office Buildings at 8.94% which includes existing and proposed sites. The vacancy rate for only Existing Class A Office Buildings is 3.00%.  This is a negative in vacancy rates from the end of 2015, and an overall decrease from the same period in 2014.  The average rental rates went up slightly and are now at $19.50 – $24.50 per square foot modified gross, which is a larger increase in the rates from the same period in 2014.

The Class A Product has 185,120 sf. as being proposed within the market and another 28,165.00 sf. that is available for sub-lease.   There was a major reduction in proposed square footage after the Spring Township Corporate Office Campus; which is now being proposed for a different use.

The Class B Suburban Office Market ended 3rd Quarter 2016 with a vacancy rate of 17.35% for existing and proposed sites.  8-17-2014 9-56-21 PMThe vacancy rate for only Existing Class B Office buildings is 15.11%.  This is a slight decrease in vacancy rates from the end of 2nd Quarter 2016 and an increase from the same period in 2015.   The average rental rates had a much-needed increase in the 2nd quarter of 2016; however they remained relatively flat ending out the 3rd quarter of 2016 with rates at $15.00 – $19.50 per square foot modified gross.

The Class B Product has 73,000 sf. as being proposed within the market.  These are subject to change as well, since one of the office sites was on/off again for a hotel development.

The Class C Suburban Office Market ended the 3rd Quarter with a vacancy rate of 14.99%, which is a larger drop from same period 2015 and a slight drop from 2nd Quarter 2016.

The overall Suburban 3rd Quarter Office Market noticed continued growth due to several lease renewals that contained expansions.  The majority of the growth has been from within the county.

The EOY report should contain positive news in an entire market review; however, going into 2017 the belief is, there will be large blocks of space added to the market which will affect the numbers, specifically the announcement by Teleflex to sell their facility.

Landlord concessions are being removed from offerings since the market has stabilized, which is also pushing rental rates upwards.

Cap Rates for Investment Grade Office Buildings remains low due to attractive financing.  The most important variables are length of leases, credit of tenant(s), type of lease, and type of asset (I.E. Single Tenant, Multi-Tenant, Medical, Back Office).  The primary issue within the investment market is the lack of quality product.

Overall activity continues to come from within the local marketplace.  The majority of the transactions taking place are companies that already call Greater Reading home.  However, most of these deals have resulted in larger footprints and longer commitments.

 

Bryan E. Cole, SIOR | Principal

NAI Keystone Commercial & Industrial, LLC
875 Berkshire Blvd., Suite 102
Wyomissing, PA 19610
Bcole@naikeystone.com

www.Bryan-Cole.com or www.WyomissingOfficeSpace.com

 

Brentwood Industries purchases 6 Commerce Drive in Cumru Twp.

Brentwood Industries Inc. will expand its operations into 6 Commerce Drive, Cumru Township Berks County.

The building was home to various companies, with the most recent company being Worley Parsons.  The facility is a 31,000 sf. two-story office building located just off I-176 and Rt. 10.  The building was purchased at a sheriff Sale by Brentwood Industries who was in the market looking to either purchase an existing building or build a new facility.6 Commerce Drive

The Article Below is from the Reading Eagle.

Brentwood Industries Inc. will expand its operations in Berks County with the help of a $2 million loan from the Pennsylvania Industrial Development Authority, Greater Berks Development Fund announced Wednesday.

The loan will assist in the Reading-based international plastics company’s acquisition and renovation of a 31,000-square-foot corporate office facility at 6 Commerce Drive in Cumru Township.

The building, which Brentwood purchased Oct. 5 in a sheriff’s sale, will house the company’s water group, sales, engineering and operations functions.

Peter Pellicano, vice president of finance at Brentwood, said Wednesday that the acquisition of the facility will accommodate expansion as a result of continued sales growth for the company.

The employees and services that will move to the new location are housed at the company’s two locations on Morgantown Road and Brentwood Drive.

Brentwood anticipates expanding its Berks County workforce by 30 jobs over the next three years, according to the news release.

The Commerce Drive building was built to house Horrigan American, said Christopher S. Witmer, director of project development with Great Berks Development Fund.

Witmer said the building has changed hands a few times since it was built, but has been vacant for some time.

For More Information about this sale or find other properties for Sale or Lease, Please Call Bryan Cole of NAI Keystone Commercial & Industrial, LLC

Post Courtesy of:

Bryan E. Cole | NAI Keystone Commercial & Industrial, LLC

direct: 610-370-8502

Bcole@naikeystone.com

Check out my new website at www.Bryan-Cole.com

About Bryan Cole and NAI Keystone

Bryan joined NAI Keystone in July of 2004, prior to joining NAI,  Bryan Cole spent 4 year’s active duty in the U.S. Marine Corp, including a 6  month deployment in Afghanistan, a 4 month deployment in Kuwait/Iraq, and a 7  month deployment in Japan.Prior to joining the military Bryan was  involved in the construction of commercial and multi-unit properties in the  Philadelphia suburbs. Bryan has experience working with a diverse group of  individuals in numerous countries throughout the world. During Bryan’s time at  NAI, he has sold and leased in the excess of $270 Million Dollar’s worth of  Commercial Real Estate. Because of this, Bryan earned NAI gold club status his  first year in the business. Bryan is currently working on earning both his CCIM  designation and SIOR designation. Bryan has been the Top Performer/Producer at  NAI since 2006 with an average of $30-$35 Million in production  annually.

NAI Keystone is a full service commercial and industrial real estate firm located in Reading, Berks County.  NAI Keystone manages and handles approximately 4 Million square feet of commercial and industrial space in Berks and Schuylkill County.  NAI is the only firm in Berks County dedicated to strictly commercial real estate.
www.Bryan-Cole.com  | 610 779 1400 (o) | 610 779 1985 (f)

New Site Designed by Bryan Cole of NAI Keystone — WyoOfficeSpace.com

New Website dedicated to Office Space for Sale or Lease in Wyomissing/Spring Township Berks County, Pennsylvania.

Bryan Cole of NAI Keystone has developed a website dedicated to the numerous properties being marketed in Wyomissing and Spring Township.

The site offers comps, market information, and property availabilities. Below is a quick overview of the site. Please visit www.WyoOfficeSpace.com and let us know what you think.

 

Welcome to WyoOfficeSpace.com

This site is dedicated to the many properties NAI is marketing in the Wyomissing and Spring Twp. sub-markets. Due to the 19610 area code being the largest concentration of office space in the market, Bryan felt dedicating a site to the availability was a priority and should serve as a primary point of interest for those parties looking to Buy, Lease, or Sell Office/Medical Space in Wyomissing and Spring Twp.

We have inventoried and surveyed the entire Berks County Office Market and have a total building square footage database along with a detailed list of every property currently for sale or lease within the public and private sectors, by ensuring a complete database we are able to provide our clients and customers Detailed and Accurate market intelligence along with un-paralleled services. Please feel free to contact us if you are interested in any of the properties within this site, or if you are currently in the market for Office or Medical Space.

We also have a property management division which oversees hundreds of thousands of square feet of commercial real estate in and around the Greater Reading Market Place.

Thank you and I hope you find our site useful.

www.WyoOfficeSpace.com

Thank you, and we encourage your comments.

Bryan E. Cole | NAI Keystone Commercial & Industrial, LLC

direct: 610-370-8502

Bcole@naikeystone.com

Check out my new website at www.Bryan-Cole.com

About Bryan Cole and NAI Keystone

Bryan joined NAI Keystone in early 2004, but before joining NAI, Bryan Cole spent 4 year’s active duty in the United States Marine Corp, including a 6 month deployment in Afghanistan, a 4 month deployment in Kuwait/Iraq, and a 7 month deployment in Japan. Prior to joining the military Bryan was involved in the construction of commercial and multi-unit properties in the Philadelphia suburbs. Bryan has experience working with a diverse group of individuals in numerous countries throughout the world. During Bryan’s time at NAI, he has sold and leased well over $250 Million Dollars worth of Commercial Real Estate. Because of this,
Bryan earned NAI gold club status his first year in the business. Bryan is currently working on earning both his CCIM designation and SIOR designation. Bryan has been NAI Keystone’s Top Performer from 2006 – 2011.
NAI Keystone is a full service commercial and industrial real estate firm located in Reading, Berks County. NAI Keystone manages and handles approximately 4 Million square feet of commercial and industrial space in Berks and Schuylkill County. NAI is the only firm in Berks County dedicated to strictly commercial real estate.
www.Bryan-Cole.com | 610 779 1400 (o) | 610 779 1985 (f)

Office Tenant Improvement Costs are Skyrocketing

Commercial real estate tenant improvements (TIs) have always cost a lot, but you would think that with the real estate market as a whole slowly marching back from the worst overall recession since the 1970s that some discounts would be available. This has not proven to be the case at all; in fact, costs for TIs requested by new tenants has taken a significant upturn during the first two quarters of 2011. What is driving this trend?

Misconception Regarding
Labor Costs
: One matter that causes people to think TIs should be flat or decreasing in cost is the fact that the
commercial and private real estate markets went flat or, in some areas, sank into chaos. Unfortunately, the price or availability of real estate has nothing to do with the cost of workers that must be hired in order to perform
tenant-requested modifications to a commercial real property. While there are plenty of workers available, the minimum wage for even menial tasks has risen and the cost of skilled labor has remained the same or increased due to average wages in a given market. In no case has the cost of construction labor, especially skilled labor, been reduced by the economy. A fair wage remains a fair wage and when a licensed contractor is required to perform work, that contractor requires a labor payment sufficient to cover his or her own pay as well as those people who must be hired to perform the tasks involved in the upgrade. As has always been the care, the more education, licensing, insurance, bonding, and other requirements that must be met by a legally operating skilled labor contractor, the higher the costs passed on to the property owner and, in the end, to the tenant paying for TIs.

Cost of Material Increases: As the economy rebounds, it seems that inflation is sneaking its ugly nose into everything everywhere. Even though salaries may not be increasing, costs are definitely on the rise. Donald Miller, a Central Texas contractor stated, “My cost for steel studs and related materials (used in TIs) have almost doubled during the first quarter of 2011. I’m not sure what caused this jump, maybe it is inflation, but I still have to pay the higher prices when I purchase materials to do my work.” Miller, like all other contractors,
has no control over the cost of materials that must be included in job bids for TI work or any other type of work and it is only because all contractors are faced with this same increase that bids remain competitive. It isn’t just
Central Texas that is facing these increases. Kenny Thompson of Thompson Concrete Construction, a Central Florida contractor, states, “I have to purchase lumber and steel for my jobs and I’ve noticed a sharp increase in the materials for what jobs that are available for RFP in the area in the last few months.” This impacts new commercial real estate, residential, and TIs – all phases of the real estate market and makes costs inch up.

Reverse Impacts of Poor Economy: Two years ago when the economy in the U.S. took a huge hit, many manufacturers of materials used in TI construction work had to lay off employees and reduce their inventory to
bare-bones levels. Some companies had to close their doors completely, leaving holes in the manufacturing of some areas and resulting in shipping costs to move materials from regions still producing or having on-hand inventory. This means that premium prices are required by the construction supply companies because of reduced inventory on hand or higher shipping costs being rolled into the price of materials.

So while the “reasonable” person would expect TI cost to be lower, reality is quite the opposite.

Backlink:

For More Information about Local News, Market Intel, or Commercial Real Estate Opportunities; visit www.Bryan-Cole.com

Bryan E. Cole | Team Leader
NAI Keystone Commercial & Industrial, LLC
direct: 610-370-8502
Bcole@naikeystone.com

Check out my new website at www.Bryan-Cole.com

NAI Keystone is a full service commercial and industrial real estate firm located in Reading PA; We handle buyer, tenant, and landlord representation throughout Pennsylvania and with the association of our global partners we can assist in locating product throughout the country.

 

Information via Officefinder

Press Release – New Listing Assignment in Leesport PA

NAI Keystone’s Bryan Cole and John Buccinno were named exclusive sale and leasing reps for a Class “A” Flex Building located at 101 S. Centre Avenue in Leesport PA. For more information visit the file below.

To view the press release see link >>  https://teamcole.box.net/shared/ejq5c1h8nz
 
For More Information about Local News, Market Intel, or Commercial Real Estate Opportunities; visit www.Bryan-Cole.com

Bryan E. Cole | Team Leader
NAI Keystone Commercial & Industrial, LLC
direct: 610-370-8502
Bcole@naikeystone.com

Check out my new website at www.Bryan-Cole.com

NAI Keystone is a full service commercial and industrial real estate firm located in Reading PA; We handle buyer, tenant, and landlord representation throughout Pennsylvania and with the association of our global partners we can assist in locating product throughout the country.

What is a Phase 1 Environmental Site Assessment?

 

A Phase 1 Environmental Site Assessment should be an integral step in acquiring commercial and/or industrial property.   So what is a Phase 1 Environmental Site Assessment, sometimes referred to as a “Phase 1 or a Phase 1 ESA”? 

A Phase 1 ESA is a report that summarizes a site visit and records review of a property and its surrounding area to determine if any additional environmental investigation is warranted to understand the liability risks associated with the identified property.  

Below is a quick summary of key activities generally associated with a Phase 1 report: 

PURPOSE

The purpose of a Phase 1 Environmental Site Assessment is to use a consistent systematic approach to identify any existing or potential environmental conditions that may be present or affect a real estate property. 

The process of completing a Phase 1 ESA has four components: 

  1. Records Review
    • Chain of title review. What has the property been used for in the past? Are there any uses that raise a red flag based on past usage?
    • Determine surrounding land use. This can be a very important part of the assessment as the risk of contamination can increase significantly if the surrounding area or properties have documented or potential contamination.
    • Historical aerial photograph review. A report will almost always include historical aerial photographs to review a time-line for development of the property as well as surrounding properties.
    • Agency contacts and related record searches. Agencies such as fire departments, local health departments, petroleum tank management associations, water departments, etc., generally are contacted in order to gather current and historical pertinent information concerning the property and the neighboring area.
  2. Site Reconnaissance
  • A visual inspection of the property and improvements plays an important role in a Phase 1 ESA.
  • The confines of the building(s) are inspected and property boundary measurements observed. The focus of a Phase 1 inspection is environmental and does not include the structure or any of the systems of the building
  • Photographs are taken of the property.
  • No physical testing or sampling is conducted during a phase 1 assessment
  1. Interviews
  • Interviews will be conducted with anyone who may have information that would help with the report. For example, past and present property managers, tenants and owners
  • If there is concern over surrounding properties, interviews may be conducted with people who have been or are involved with that property.
  • Agencies contacted above such as fire departments, local health departments, petroleum tank management associations, water departments, etc., generally are contacted in order to gather current and historical pertinent information concerning the property and the neighboring area.
  1. Report
  • Documentation. Findings, opinions and conclusions must be supported by documentation to facilitate the assessment.
  • Scope of Services.  The report will describe all services preformed in detail to allow for another party to reconstruct the work completed during the investigation.
  • Findings.  The Findings section indentifies known or suspected recognized environmental conditions.
  • Opinion.  Includes the environmental professional’s opinions of the impact on the property of conditions indentified in the Findings Section.
  • Additional Investigations.  The environmental professional should include an opinion if any additional investigations are necessary to further clarify any findings that may indicate there are environmental concerns.
  • Data Gaps.  Should there be any significant data gaps that affect the ability to evaluate the property these need to be indentified and commented on.
  • Conclusions.  Provides a summary all recognized environmental conditions connected with the property.

Information Presented by:

For More Information about Local News, Market Intel, or Commercial Real Estate Opportunities.  visit www.Bryan-Cole.com

Bryan E. Cole | Team Leader
NAI Keystone Commercial & Industrial, LLC
direct: 610-370-8502
Bcole@naikeystone.com

Check out my new website at www.Bryan-Cole.com

NAI Keystone is a full service commercial and industrial real estate firm located in Reading PA; representing buyer, tenant, and landlord representation throughout Pennsylvania.

East Penn acquires former Caloric site

By The Reading Eagle Company

East Penn Manufacturing Co. Inc., near Lyons, has purchased the Maulfair Medical Center building at 403 N. Main St., Topton.
According to documents filed with the Berks County recorder of deeds, the price paid was $1.95 million.

Daniel R. Langdon, East Penn’s president, said the property is contiguous to the company’s distribution facility.
Langdon said East Penn likely will use the property for office space, but has no firm plans for it at this point.

The property, on about two acres, was a part of the former Caloric Corp. , which closed in July 1991 after more than a century in the borough. Caloric was an appliance manufacturer.

Langdon said East Penn over the years has acquired most of the former Caloric property from Raytheon Corp., which bought Caloric in 1967.

“We have substantially all of it,” Langdon said, adding that East Penn made its initial purchase of Caloric property in 1996.

That was the same year that Conrad G. Maulfair Jr. and his wife, Coleen M. Maulfair, of Maulfair Medical Center purchased the Main Street property.

It also was the same year that the Department of Environmental Resources released Raytheon from liability following its cleanup of the site.

In the 1990s following the plant shutdown, Raytheon spent more than $7 million on the cleanup.

Contaminants included chromium deposits in the soil and PCE, or perchloroethylene, in the groundwater. Both are considered cancer-causing chemicals. Underground storage tanks also were removed.
Kevin Sunday, a spokesman for DEP’s southcentral regional office, said the property was cleared for groundwater, as well as for metals (including chromium and copper) and chlorinated solvents that had been in the water.

Langdon said East Penn conducted an environmental study of the property before buying it.

Coleen Maulfair said the medical center is still in the Main Street property and is leasing space from East Penn.

For More Information about Local News, Market Intel, or Commercial Real Estate Opportunities.  visit www.Bryan-Cole.com

Bryan E. Cole | Team Leader
NAI Keystone Commercial & Industrial, LLC
direct: 610-370-8502
Bcole@naikeystone.com

Check out my new website at www.Bryan-Cole.com

NAI Keystone is a full service commercial and industrial real estate firm located in Reading PA; representing buyer, tenant, and landlord representation throughout Pennsylvania.