Advance Realty Group Records Stellar Year in 2005
Advance Realty Group, a Bedminster, NJ-based commercial real estate owner and developer, recorded another successful year in 2005. Throughout Advance’s 26-year history, the Company has consistently re-invested in its core operations, new development opportunities and value-added acquisitions.
In 2005, Advance Realty Group successfully met all of its targets and strategic business objectives. In total, the Company signed over 1.1 million square feet of leases, acquired over $330 million of new properties and made $22.5 million of investments in its existing properties, all of which have substantially increased the Company’s presence in the Northeast.
Greg Senkevitch, COO, commented, “Advance continued its growth in 2005, with acquisitions and leasing leading the way. Additionally, we were able to build upon our capital base by issuing $60 million of trust preferred securities during the year. We successfully completed two, large-scale repositioning projects totaling 450,000 square feet and we commenced 500,000 square feet of new commercial development including phase one of our largest mixed-use project, Harrison MetroCentre. Looking ahead into 2006, we are extremely confident that we have the people, product, capital base and pipeline to continue our market leadership for the foreseeable future.”
Highlights recorded by Advance Realty Group in 2005 include:
Acquisitions
The following acquisitions and partner buyouts were funded through Advance’s internal capital resources:
In December 2005, Advance completed the acquisition of 445 South Street in Morris Township, NJ. The 320,000-square-foot office building has been renamed Advance at Southgate and will undergo a complete repositioning. Advance has implemented an extensive, $20 million capital improvement program that will include a dramatic entryway, new HVAC systems, curtain wall, roof and parking facilities. The three-story building will also offer Advance’s signature World Class Business Environment amenities such as gourmet executive food service, state-of-the-art multimedia conference facilities, fitness center and redundant building infrastructure. Advance at Southgate will be available for occupancy in June 2006.
During the year, the Company acquired 260 Cherry Hill Road in Parsippany, New Jersey. The vacant, 132,000 square-foot office building was acquired and successfully repositioned as a World Class Business Environment, which will target corporate users needing significant and redundant building infrastructure to support data operations and business continuity needs.
In 2005, Advance acquired Branchburg Centre, which is located at 3040 Route 22 West in Branchburg, New Jersey. The acquisition includes Branchburg Centre, a 90,000-square-foot, fully-occupied office building, and 31.8 acres of vacant land, which is fully approved for the construction of a new 290,000-square-foot, Class A office development.
In addition to these acquisitions, the Company acquired the interests of its joint venture partners in two large-scale signature properties during the year:
In June, Advance acquired the entire interest of its partner in Avion Business Park, Chantilly, VA. Advance is now the sole owner of nine buildings totaling approximately 800,000 square feet at this project, which is located adjacent to Dulles Airport in Fairfax County, VA. Advance controls the majority of the park and has long-term rights to acquire an additional one million square feet of future development.
Shortly after the end of the year, in January 2006, the Company acquired its partner’s interests in One Gateway Center, a 26-story, 500,000-square-foot mixed-use, transit-oriented Class A property connected to Newark, NJ’s historic Penn Station. With the leasing completed in 2005, One Gateway Center is currently 78 percent occupied. Having already completed a $4.8 million dollar lobby/retail concourse repositioning, Advance plans continued enhancements to this venerable property, including the development of street level retail on the plaza facing Penn Station. Additionally, Advance will move forward with its plans to capitalize on the property’s one million square feet of development rights.
Leasing
In its largest lease transaction of the year, Advance Realty Group executed a long-term lease with Eisai Inc. for a 209,000-square-foot World Class Corporate Headquarters at 100 Tice Boulevard in Woodcliff Lake, NJ. This three-story, state-of-the-art building is currently under development with a scheduled delivery of January 2007. The transaction has been called the largest corporate headquarters development in Bergen County in the last decade. Studley represented Eisai Inc. in this transaction.
Virginia Department of Transportation renewed its 122,279-square-foot lease at Avion Business Park in Chantilly, Virginia. CB Richard Ellis represented the Virginia DOT in this transaction.
At One Gateway in Newark, Advance Realty Group maintained its 95 percent renewal rate and signed several new leases including a lease for 27,656 square feet with Kaplan, Inc., which will lease this space for its medical school test prep division. GVA Williams represented the tenant and additionally serves as exclusive leasing agents for One Gateway. Herrick Feinstein, a prominent law firm, also relocated to One Gateway Center and signed a lease for 18,638 square feet. The law firm was represented by Cushman & Wakefield of NJ.
Advance’s largest repositioning project in the Washington, D.C. region is 8301 Professional Place, which is located within the Company’s Metro East Business Campus in Landover, MD. Advance is completing a $7 million repositioning of this 140,000-square-foot office/R&D property. Responding to the Company’s vision and efforts, The Epilepsy Foundation signed a new headquarters lease at the facility for 32,647 square feet during the second half of 2005. Grubb & Ellis represented Advance in this transaction, while The Staubach Company represented Epilepsy.
In addition to the leases signed during the year, Advance concluded a large-scale tenant transaction at its 132,000-square-foot, Advance at Parsippany project at 260 Cherry Hill Road. The successful acquisition and repositioning plan for this project resulted in the sale of the property to Time, Inc. in September 2005. Cushman & Wakefield represented Time, Inc. in this transaction.
Property Investments
As part of its planned $7 million repositioning plan, Advance completed a major lobby and elevator renovation program at the east wing lobby of 8301 Professional Place at Metro East Business Campus in Landover, MD. 8301 Professional Place is a two-story, two-wing office/R&D building containing an expansive atrium and meeting/work space areas that are attractive to high-tech and educational users. The property is one of nine buildings that Advance Realty Group owns in Metro East Business Campus.
The Phase One multi-million dollar repositioning of One Gateway Center in Newark, New Jersey was completed this past year, updating the landmark mixed-use office and retail complex. The dramatic new lobbies and enhanced retail space at One Gateway create a bold, exciting and vibrant point of entry into the complex and represents one of the largest renovation projects completed in Newark in the last decade.
Development
In addition to the build-to-suit project on behalf of Eisai Inc.’s in Woodcliff Lake, NJ, the Company acquired the Harrison redevelopment site and commenced site work on Phase I of Harrison MetroCentre, which will consist of 850 residential units, a hotel, a parking garage, 150,000 square feet of office space and up to 200,000 square feet of retail space. Phase I is expected to be completed in 2007. The entire redevelopment project, which will ultimately encompass three million square feet of Class A office space, 500,000 square feet of retail space and approximately 4,000 housing units. Harrison MetroCentre will also include a 25,000-seat stadium, which will be the new home of the New York/New Jersey Metro Stars soccer team.
Tenant Relations
Advance Realty Group continues to place a strong emphasis on its tenant relations efforts and considers this aspect of its business one of the keys to delivering World Class Corporate Business Environments on a consistent basis.
Advance’s strong focus on its tenants was recently recognized by Buildings magazine on its prestigious Who’s Who 2005 “A” List. Additionally, Advance’s tenant-centric approach was the key ingredient in its recently announced corporate headquarters build-to-suit transaction with Eisai Inc.
Advance was presented with nine highly coveted National Commercial Real Estate Customer Service Awards For Excellence in 2005. CEL & Associates presents these annual awards to those properties that achieve the highest level of quality and service as rated by tenants within those properties. The awards are determined by achieving a minimum of 50 percent response rate and an overall score of 85 or higher.
Community Relations
Advance believes that the responsible use of land and the ownership of World-Class Corporate Business Environments obligate the Company and its associates to incorporate the needs of the community into each of its projects.
During the year, Advance Realty Group and the Advance Realty Foundation made over 150 individual contributions/donations totaling in excess of $480,000, benefiting not-for-profit entities such as MS Society, Midland Foundation, NJN Foundation, NJPAC Jazz for Teens, New Community Foundation, Somerset Medical Center, United Way, Boys’ and Girls’ Club, Liberty Science Center, St Jude Children’s Hospital, YMCA, American Cancer Society, Ronald McDonald House, The Trust for Public Land, Link Community School, Project Acorn, The Valerie Fund, New Jersey State Opera, March of Dimes, American Red Cross, and support for numerous Katrina Relief efforts.
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Advance Realty Group is an owner and developer of office, flex, industrial, retail and multifamily properties. With 5.5 million square feet of operating properties and a development portfolio consisting of eight million square feet of commercial projects and 9,400 residential units, Advance is one of the leading real estate owners in the Northeast and is headquartered in Bedminster, New Jersey.
