Liberty Property Trust plans to construct a $1 billion
“iconic skyline” along the Delaware River in Camden, N.J., that aims to become
an integral component to the struggling city’s revitalization.
While the Malvern, Pa., real estate investment trust has
owned office and industrial buildings in South Jersey, it has never invested in
the city of Camden.
Liberty’s decision to make a significant commitment to
Camden now is being driven by several demographic and market factors including
an increasing desire of a younger workforce to live and work in dynamic urban
environments, as well as lucrative tax incentives state officials put in place
through its Grow New Jersey Assistance Program. Those combined have created a
more attractive environment for private investment and made it less of a
gamble.
Camden has been steadily trying to rise out of a
decades-long doldrums that saw jobs and companies flee, crime and poverty rise
and investment, especially from the private sector, lacking.
But state officials believe that the seeds for change
have finally been sewn as a result of their efforts and those of others, who
are banking on the city having a bright future.
There have been several high-profile companies that have
decided to move there because of the tax breaks, including American Waterworks,
Subaru of America Inc. and, more recently, an international metal recycling
company.
Cooper Medical School is up and running, and now has an
M.D. Anderson Cancer Center affiliated with it, and Brandywine Realty Trust
(NYSE: BDN) was named master developer of 13 acres that Campbell Soup Co. owns
and is expected to create a new gateway for Camden.
Those additions join some other established venues along
the waterfront including Adventure Aquarium, Susquehanna Bank Center,
Campbell’s Field and other attractions.
Camden wasn’t really on Liberty’s radar until some
business leaders and others approached company executives nearly a year ago and
encouraged them to consider taking a closer look and possibly making an
investment. The conversations resulted in Liberty signing an agreement to
acquire 16 waterfront acres from Steiner + Associates, which had long owned the
land and had plans to develop it but never did.
Liberty then enlisted Robert A. M. Stern Architects to
come up with a master plan for a mixed-use community that involves constructing
up to 1.7 million square feet of office space in four to five buildings, four
parking garages, a hotel with 120 to 140 rooms, and 325 apartments.
Dranoff Properties of Philadelphia has been retained to
do the multifamily component. Retail and restaurants will also be part of the
development as well as enhancing green spaces along the river. As Liberty
(NYSE: LPT) has done at the Navy Yard, it will identify a hotel operator but
retain design control over the structure so it fits within the overall scheme.
The plans are ambitious, especially in a market untested
for something this grand and vast.
“The more we looked at this, we knew we needed a project
of scale and we came to the conclusion we could create a real sense of place, a
whole new neighborhood or piece of downtown Camden,” said John Gattuso, senior
vice president at Liberty.
Construction could begin soon on parts of the plan.
Liberty would like to break ground during the third quarter of next year and
anticipates build out to take the next four to five years.
Gattuso said he is already in both early and advanced
discussions with tenants that would fill the entire 1.7 million square feet of
office space that is planned. This comes as companies continue to recognize
they need to be located in environments and physical structures that can
attract and retain high-caliber talent, especially as Baby Boomers retire and
firms need to re-populate their workforce, Gattuso said. This is what Liberty
intends to provide in Camden as it has done elsewhere.
There is also money at play. “Without the tax credits,
you don’t have these conversations,” Gattuso said.
A likely scenario would have Liberty constructing
build-to-suits for tenants, who would then take ownership of the buildings so
they can reap the tax benefits awarded under the Grow N.J. program.
Could this be a new beginning for the beleaguered South
Jersey city?
“What has been lacking in Camden is momentum and a
committed developer to oversee that,” Gattuso said. “It starts with the vision
and what would success look like. Success for Camden is having an individual
call their spouse to have dinner along the river overlooking the Philadelphia
skyline. That would happen because you would have done something there. You
would have created an ambiance and created market demand for a nice
restaurant."
Source: Philadelphia
Business Journal
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