Velocity Venture Partners continues to snap up industrial properties in South Jersey.
The local investment and redevelopment firm purchased a 196K SF industrial building at 2572 Brunswick Pike in Mercer County's Lawrence Township for $12.1M, Bisnow can exclusively report. Velocity sourced and closed the deal with seller Aurobindo without the use of a broker.
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Velocity is also underway on $2M in capital improvements to turn the 166K SF of available space into a "whitebox" ready for tenants, Velocity founding partner Tony Grelli told Bisnow. The building, which sits on 15 acres just off an entrance to U.S. Route 1, sold for $62 per SF, which Grelli estimates to be about one-third of replacement cost.
Built in the 1960s, 2572 Brunswick Pike has had a varied history of light manufacturing uses, most recently pharmaceutical development — the area in which Aurobindo does business. Trade school Fortis Education occupies 30K SF in the building on a long-term basis, but the rest is vacant and available for immediate lease, Grelli said.
Covered by a 1.3-megawatt solar panel array, 2572 Brunswick Pike has the location to support a distribution center and the infrastructure to support modern manufacturing needs. Route 1 meets Interstate 295 2 miles away from where it touches the Lawrence Township property.
Even as the industrial asset class has cooled off after an overheated multiyear period — and despite capital being so hard to come by for virtually every property type — Velocity created and sustained its own momentum with sellers, lenders and equity partners by closing deal after deal, Grelli told Bisnow in June. Certainty of deal closure was the key factor in Aurobindo's decision to sell, Grelli said.
By acquiring functional or easily converted buildings, Velocity avoids the costs of ground-up construction and local government-induced delays that have stymied developers in the Philly region the past couple of years. Amid a steep nationwide decline in industrial leasing, convenience of location has regained importance to prospective tenants.
Velocity has three more properties "in the immediate area" under contract to acquire this year, Grelli said, and has enlisted Avison Young to market the available space in 2572 Brunswick Pike to tenants. The 166K SF vacancy can be leased in its entirety or broken into 80K SF halves.
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