With industrial properties generally priced too high to
make sound investments, Liberty Property Trust continues to focus on another
avenue of growth — developing new buildings.
The company started construction during the third quarter
on eight industrial buildings totaling 2.2 million square feet and $150
million.
Among the projects that Liberty has underway in
Pennsylvania is an 800,000-square-foot distribution center in Bethlehem, Pa.,
in which online retailer Zulily has fully leased. Zulily is expected to employ
1,200 employees when it opens the facility next year. Liberty also leased
421,200 square feet of a distribution center in Carlisle, Pa., to chocolate
maker Lindt and Sprungli Inc.
While Liberty has always been an active buyer and
developer, the company lowered its guidance in July on how it would financially
do this year. The Malvern, Pa., real estate investment trust said it expected
fund from operations, the method by which REITs are financially measured, to
come in at $2.42 to $2.48 a share rather than $2.45 to $2.55 a share.
The reduction was attributed to the company making fewer
acquisitions among other reasons.
In a statement then issued by the company, CEO Bill
Hankowsky said that even though there was good activity in the industrial
market and fundamentals such as demand and rent increases were solid, a “thin
and pricey industrial transaction market [was] offering few acquisition
opportunities that meet our investment criteria, therefore it has taken longer
than expected to deploy the capital on our balance sheet in a manner that
creates value.”
Some of its other industrial development activity in the
third quarter is in Maryland, South Carolina, Wisconsin, Illinois and
Minnesota.
Source: Philadelphia
Business Journal
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