FMC Tower, Evo at Cira South making progress

Aside from Brandywine Realty Trust forming a joint venture to construct a new mixed-use building at 1919 Market St. in Philadelphia, the real estate investment trust touched on several other issues during its recent third-quarter earnings call with analysts.

Some highlights:

Four Radnor Corporate Center has a 90,000-square-foot tenant, Rovi Corp., leaving for new space at Cross Point. However, that space is being backfilled with eMoney Advisor, which is taking 70,000 square feet beginning December 2015.

The construction of the new FMC Tower at Cira Centre South is on schedule. As for the office space in the building, Brandywine is talking to a number of mid- to large-sized tenants — some of whom are considering moving into University City from suburban locations as well as firms that are expanding. About 100 of the 268 apartments in that mixed-use tower will be extended-stay and operated by the Korman Communities.

Evo at Cira South, a 344-unit student housing project at 30th and Chestnut streets in Philadelphia, is just below 50 percent leased after officially opening in August. That level of leasing is "really not in line with some of our initial expectations that the partnership had," said Jerry Sweeney, president and CEO of Brandywine on the conference call. "It does represent a pretty good out-of-the-gate performance for a property that wasn't really able to show renters any units until very late August." It was hoping for an earlier delivery but was held up by 21 days due to weather delays. The company expects Evo to take two years to fully lease up.

The company has entered into a 5-year option agreement to acquire parts of a 13-acre parcel in Camden, N.J., where it has been named master developer by Campbell Soup Co. Brandywine anticipates securing one of those sites when it lands a build-to-suit opportunity.

"So for us it's a master-planning exercise, a marketing exercise," Sweeney said. "We will be investing some money in the master planning and marketing but from a business standpoint, as I mentioned, provides the option not the obligation to acquire those. It really does fit into our wheelhouse and our strategic plan of developing multi-modal office and mixed-use town center developments that are served by mass transportation..."

The company reported a solid quarter. Funds from operations came in at $62.7 million, or 36 cents a share, compared with $63 million, or 39 cents a share. FFO is the accepted measure of gauging a real estate investment trust's financial performance. The company expects to end the year with an occupancy rate of more than 91 percent. Its portfolio of 23.5 million square feet was 88.9 percent occupied at the end of the third quarter but has leases signed that bring it up to 92.5 percent.

Source: Philadelphia Business Journal