2200 Renaissance King of Prussia, Pa Capital Markets Contacts
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A 184,118 SQUARE-FOOT CLASS A OFFICE BUILDING LOCATED IN THE HEART OF THE KING OF PRUSSIA MARKET 2200 RENAISSANCE KING OF PRUSSIA, PA CAPITAL MARKETS CONTACTS Robert Fahey Executive Vice President T +1 610 251 5184 [email protected] Jerome Kranzel Senior Vice President T +1 610 727 5889 [email protected] Erin Hannan, MAI Associate T +1 610 251 5168 [email protected] DEBT & STRUCTURED FINANCE Steven Doherty Senior Vice President T +1 610 251 5175 [email protected] Nick Harris Vice President T +1 610 251 5149 [email protected] CBRE, Inc. 1200 Liberty Ridge Drive, Suite 320 Wayne, PA 19087 Licensed Real Estate Broker EXECUTIVE SUMMARY 04 PROPERTY OVERVIEW 12 REGIONAL OVERVIEW 26 OFFICE MARKET OVERVIEW 34 FINANCIAL ANALYSIS 40 PROPERTY TENANCY 50 For more information on Triad, please visit our website at www.cbre-triad2200renaissance.com TABLE OF CONTENTS 3 PHOTO: GEORGE YU EXECUTIVE SUMMARY THE OFFERING CBRE is pleased to present the opportunity to acquire Triad (the “Property”) located in King of Prussia, Pennsylvania. This Class A, multi-tenant, 184,118 rentable square foot building was constructed in 1985 and completely renovated in 2014 using the highest quality construction materials and design focus that caters to the most discerning tenants. The Property sits on 10.1 acres within the highly regarded Renaissance Corporate Park and offers easy access to all the amenities available in King of Prussia and Conshohocken, two of the leading suburban markets in the region. With several public transportation options, ample parking and drive times of less than 30 minutes to Philadelphia, Triad is an easy commute for the millennial employee while also offering drive times of less than 15 minutes for the decision makers who call Philadelphia’s Main Line home. Currently 94% occupied, Triad has experienced nearly 150,000 SF of leasing activity since current ownership completed a $4 million renovation in 2014 with rents increasing by up to $2 PSF since 2014. Current ownership has retained every tenant whose lease has expired since buying the Property. The Property has a weighted average remaining term of 5.7 years and is anchored by Liberty Mutual, Ratner Prestia and TeleRx which occupy 45% of the Property and have an average weighted lease term of 6.9 years. A new owner has the unique ability to push rents significantly in the near term in an ever-tightening Class A market as tenants continue to demand well-located, highly amenitized space in Greater Philadelphia. Asking rents today at Triad are at least 20-25% ($5.00-7.00 PSF) below its trophy competition in King of Prussia and Conshohocken which offers significant upside to a new owner while offering cost-competitive, high quality space to tenants. Triad is offered free and clear of existing debt. When new low interest rate debt is combined with the Property’s strong tenant profile, diverse rent roll and significant remaining lease term, Triad is positioned to provide outstanding cash flow and impressive cash on cash returns to a new owner. PROPERTY OVERVIEW Address: 2200 Renaissance Blvd, King of Prussia, Pa Land Area: 10.01 Acres Number of Stories: 4 Year Built/Renovated: 1985/2014 Square Feet: 184,118 Occupancy: 94.24% PHOTO: GEORGE YU Parking: 657 spaces (589 surface/68 covered) 6 TRIAD | 2200 RENAISSANCE BLVD INVESTMENT HIGHLIGHTS PREMIER CLASS A PROPERTY SIGNIFICANT CAPITAL IMPROVEMENTS Triad is a Class A suburban office building containing 184,118 square feet on four floors. The Significant Recent Capital Investments - In addition to the Property was designed by RHJ Associates with architectural details that are difficult to replicate and more than $5.2 million invested for tenant improvements features a 55 foot atrium lobby with a bright central skylight, an incredible window line and scenic since 2014, current ownership completed $4 million in views. A full-scale renovation was completed in 2014 to drastically improve all of the common areas renovations including lobby and common area upgrades, both inside and out along with significant investments to modernize the mechanical systems. This the addition of modern entrances, café and fitness center gut renovation solidified Triad’s position as one of the most desired Class A buildings in the region. remodels, new cooling tower and chiller, as well as All new amenities were added including the Triad Cafe, Triad Fitness Center and Triad Conference significant landscaping and exterior upgrades. Center. Triad is centrally located within Renaissance Corporate Park and offers 589 parking stalls surrounding the DESCRIPTION AMOUNT building along with 68 executive reserved HVAC Upgrades- $1,003,114 parking spaces underneath the Cooling Tower & Chillers Property, a unique feature within Main Level & Entrance $836,398 the market. Upper Floors- Atrium/Corridors $507,348 In-Fill Floor Openings $262,000 Between floors 3 & 4 HVAC - RTU Replacement $256,000 Restrooms $227,766 Triad Fitness Center ( Incl. new equipment) $191,143 Triad Cafe $174,308 Parking Lot (resurfaced & restriped) $99,197 Furniture for Atrium Center $67,220 Triad Conference Center $61,708 Signage- Design & Installation $56,740 Elevator Cabs $51,151 A/V Equipment $46,772 (Atrium & Fitness Center) Interior Landscaping $40,885 (Bamboo & Planters) Artwork for Common Areas $14,647 Soft Costs - Architects, Engineers, $461,322 Consultants, etc. Total: $4,357,719 EXECUTIVE Summary 7 INVESTMENT HIGHLIGHTS (CONTINUED) FLEXIBLE DESIGN Triad features an array of suites capable of accommodating small and large sized tenants. The Property has minimal interior columns and provides efficient layouts and great flow on every floor. The efficiency is further complemented by the unique glass line-to-floor ratio for any size layout while additional corner offices provide spectacular views and abundant natural light due to low sills and glass to ceiling heights of 8’9”. The floorplans include +/-1,000 to +/-17,500 square foot suites, +/-15,000 square foot wings, and +/-50,000 square foot floors. IMPRESSIVE LEASING VELOCITY Triad has experienced a 100% tenant renewal rate since current ownership took control in March of 2013 with nearly 150,000 SF of leasing activity across 15 tenants occurring after the building renovations were completed in September of 2014. Current ownership has experienced 8% rent growth since these renovations were completed. DESIRABLE DIVERSE OCCUPANCY PROFILE WITH YIELD GROWTH POTENTIAL Home to a diverse blend of high-quality tenants from industries such as pharmaceuticals, advertising and law, a substantial portion of the Property’s in-place tenancy is credit-worthy – providing surety of income and predictable cash flow. With asking rents currently 20-25% ($5.00 - $7.00 PSF) below its trophy competition in King of Prussia and Conshohocken, a new owner should be able to continue to push rental rates while still offering a compelling, cost conscious option for tenants looking for well located, highly-amenitized buildings in the region. TENANT SF LEASE EXPIRATION ASI Buisness Solutions, Inc. 14,419 Jun-18 CMI Media, LLC 13,292 Dec-21 Genomind, Inc. 8,699 Dec-20 Telerx Marketing, Inc. 15,782 Nov-21 Liberty Mutual Insurance Co. 42,418 Jun-22 A.D. Marble & Co., Inc. 10,463 Mar-24 Ratner Prestia, PC 23,915 Aug-27 8 TRIAD | 2200 RENAISSANCE BLVD PHOTO: GEORGE YU BEST IN CLASS A AMENITIES PACKAGE The property’s tenants enjoy access to the well-equipped Triad Cafe featuring full catering capabilities, as well as the Triad Fitness Center with lockers and showers. Triad also offers underground parking, outdoor balconies, the Triad Conference Center and direct access to a jogging trail. The immediate area is serviced by public transportation via bus or train while also being located in close proximity to the 2.4 million square foot King of Prussia Mall, several hotels, restaurants, award winning golf courses and other attractions along the river in Conshohocken. EXECUTIVE Summary 9 Harleysville 95 Mercer 476 County Pottstown Bucks Ewing Montgomeryville 611 1 REGIONAL MAP County 29 422 Montgomery PA TPKE NORTHEAST EXT Lansdale 232 County 73 Trenton Pennsylvania 532 295 202 195 Horsham 23 PENNSYLVANIA TPKE 130 100 Blue Bell 1 422 2200 RENAISSANCE 309 1 Levittown Chester Phoenixville Audubon KING OF PRUSSIA, PA Willow Norristown Grove County 276 276 NEW JERSEY TPKE King of Plymouth 611 Prussia Meeting 476 Philadelphia 95 68 Conshohocken Melrose Marsh 76 County Creek 202 Park 130 Lake 23 295 Fairmount 73 206 Park 30 30 Ardmore 1 Newtown 76 Downingtown Palmyra Philadelphia Pennsauken 322 Broomall West 3 Drexel Upper 38 Moorestown Chester Hill Darby Media Center Camden Delaware City New Burlington 1 Springfield Cherry County County 676 130 Hill Jersey 202 13 76 73 Chester 476 70 Heights Philadelphia 1 95 International 295 Chester Airport 322 Delaware River Kennett Bellmawr Square 206 30 New Castle 322 County 95 130 42 NEW JERSEY TPKE Delaware 55 Camden 495 Gloucester EXCEPTIONAL LOCATION WITH IMMEDIATE ACCESS 295TO MAJOR HIGHWAYS County Wharton 13 State Forest Triad is locatedWilmington only minutes away from I-76 (Schuykill Expressway), I-476 (the Blue Route) andCounty I-276 (the Pennsylvania Turnpike) and offers great connectivity as it is approximately 16 miles from Center City Philadelphia and the Philadelphia International Airport. The Property is ideally situated along the “Main Line” and offers all the benefits of a King of Prussia address while also being located 5 minutes from downtown Conshohocken which features a thriving restaurant, shopping and