Wells Fargo Leads $100M CMBS Refi for Philly-Area Industrial Properties
By Andrew Coen July 21, 2021 10:52 am
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Velocity Ventures Partners has landed more than $100 million in commercial mortgage-backed securities (CMBS) financing for three last-mile industrial assets in the Philadelphia region, Commercial Observer can first report.
Wells Fargo (WFC) supplied a $75 million senior loan with Morrison Street Capital chipping in a $10 million mezzanine loan for Velocity’s Lansdale Portfolio — which comprises two properties totaling 1.1 million square feet. JPMorgan Chase (JPM) also provided a $17.75 million CMBS loan for the Pennsauken Logistics Center, which Velocity acquired from the Aluminum Shapes in February 2020 for $10.1 million, according to property records.
Ackman-Ziff Managing Director Dave Jacobs arranged the financing.
“These refinancings enabled the sponsor to repatriate capital to its partners, take advantage of today’s low rates and further enable their rapid growth strategy,” Jacobs said in a statement.
Wells Fargo did not immediately respond to a request for comment on the debt package. JPMorgan Chase declined to comment.
Velocity purchased the Lansdale Portfolio last year during the COVID-19 pandemic, when the properties — located at 2750 Morris Road and 1180 Church Road — were at a combined 55 percent occupancy. Occupancy has since been raised to more than 90 percent occupancy, according to Ackman-Ziff.
The Philadelphia-based developer bought 2750 Morris Road for $33 million from DIV-AR Property and acquired 1180 Church Road from DeSanto Realty Group for $19.5 million.
Located at 8600 River Road in Pennsauken Township, N.J., the Pennsauken Logistics Center was bought by Velocity when it was a vacant 326,000-square-foot, last-mile industrial property. The space is now 100 percent leased after Velocity inked Utopia Fulfillment as a tenant last August.
“The success of these three projects is a true testament to the value of last-mile industrial in suburban Philadelphia and southern New Jersey,” said Zach Moore, founding partner of Velocity. “In a short period of time, we were able to fully stabilize these assets and complete this series of financing. We are grateful for the Ackman-Ziff relationship and are excited to have finalized these recapitalizations.”
“There are many aspects to these three deals that we are incredibly proud of: sourcing and taking down Morris [Road] and Church [Road] during the heat of COVID-19, leasing an aggregate 925,000 square feet in just a handful of quarters after each deal closed, and bringing them in for 10-year permanent financing in such a short period of time,” said Velocity founding partner Tony Grelli. “These are flagship Velocity assets that we are thrilled to own long term.”
Andrew Coen can be reached at acoean@commercialobserver.com.
