Liberty Property Trust Sells GSK's Navy Yard Headquarters

Another foreign buyer has made a significant purchase in Philadelphia's commercial real estate market.

An affiliate of Korea Investment Management Co. has agreed to purchase Five Crescent Drive, the U.S. headquarters of pharmaceutical company GlaxoSmithKline, from Liberty Property Trust for $130.5M. The 208K SF building in the Philadelphia Navy Yard was purpose-built for GSK in 2013, and the company is the building's sole occupant.

Liberty Property Trust, the Navy Yard's master developer, was represented by CBRE in the transaction, and the KIM affiliate retained Coretrust Capital Partners to advise it in the purchase. CBRE teams also arranged the debt for the acquisition and will manage the property for the Korean company.

Liberty has been on a monthslong sales binge to unload its suburban office assets in favor of industrial properties, but had made no such plans on its urban core assets. With a long-term lease from GSK in hand, Five Crescent Drive made for one of its more stable assets. One of the few office buildings in the country to be certified as Double LEED Platinum, it was designed for extreme sustainability into the future.

Money may be on the REIT's mind, however, as its development for Comcast, the supertall Comcast Technology Center, has gone at least $67M over budget, an overrun Liberty blames on its contractor. If a lawsuit arises from the disagreement, legal fees could send the bill even higher.

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