"This building was leased by a company based in London called BOC. They had the option of buying it, but allowed Onyx to take over, and then option," Patrick Green, EVP of CB Richard Ellis, and the broker who originally sold the property to Onyx, tells GlobeSt.com. Green further explains that "Onyx actually received a higher offer, but who knows why companies do what they do. Onyx missed an opportunity, but they still made money off the deal."
BOC Gases formerly occupied the 21-year-old building which features 19,000-sf of office space, 15,000-sf of air-conditioned production area, a parking lot, 10 tailgates, one drive-in door, and 24 feet ceilings. The buyers of the site will be able to expand the building by about 7,000 sf or the parking area from 102 spaces to add more than 600 spaces. The property offers access to I-95, I-76 and the Pennsylvania Turnpike.
Green says he sold an empty industrial property in this area for $37 a sf, but now prices for similar buildings in the area are going for $62 to $80 per sf. "Smaller buildings like this one get better prices because there are more possible users for a smaller building that a bigger one," Green tells GlobeSt.com.
"There was significant interest in this property due to its desirable location within the Philadelphia International Airport industrial submarket," Michael Nevins, vice president of asset management at Onyx Equities, says in a prepared statement. "We were able to successfully execute the acquisition and disposition of this property within a very quick timeframe and deliver an excellent return to our investors." Representatives from Onyx did not want to disclose any further information about the deal to GlobeSt.com.
Onyx is a Woodbridge, NJ-based company that owns nearly 3.4 million sf of office, retail and industrial properties in Pennsylvania, New Jersey, New York, Connecticut and Florida. The Staubach Co. represented Onyx in the sale of the property.
According to Cushman & Wakefield's Philadelphia Industrial Marketbeat report for Q1 '08, the market for warehouse space remains stable, and vacancy rates have fallen 160 basis points since the first quarter of 2007 to their current 7.5%. "Overall, vacancy rates and rental rate growth remain healthy, but there is concern that the nationwide economic slowdown will begin to affect the local industrial market," says Larry Maister, senior director of C&W in the report. "We are seeing a drop in leasing activity and fewer new prospects actively looking for space. Cautious optimism remains that this trend will be short-lived, and that strong fundamentals will carry through to the next upturn in the cycle."
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