Brandywine Realty has big year with sales, sees lease up at FMC Tower

Brandywine Realty Trust ended its year selling $860 million in properties — handily exceeding its original target of unloading $450 million — and reaching a leasing milestone at FMC Tower, which is now 96 percent occupied.

These were among the updates the company provided Tuesday during a company conference call with analysts to discuss fourth quarter and year-end results.

Among other updates from the company:

• The multifamily project at 1919 Market St. in Philadelphia that it developed in partnership with CalSTRS and LCOR is complete. The 29-story, 455,000-square-foot building has 321 apartments as well as 24,000 square feet of office and commercial space. The office and retail space is fully leased and occupied. A 215-vehicle garage is averaging 90 percent occupancy each day and Brandywine is projecting a return of 7 percent on those parking operations. The apartments are already 76 percent leased and 68 percent occupied;
• The company sold its 50 percent stake in an apartment complex called Parc at Plymouth for $100.5 million to an undisclosed buyer. Brandywine (NYSE: BDN) developed the 398-apartment complex on 20 acres at 134 Plymouth Road in Plymouth Meeting, Pa., with Toll Brothers Inc. (NYSE: TOL). The total project cost $77 million to build. In the sale, Brandywine reported proceeds of $27.2 million and expects to record a gain of $14.6 million;
• Brandywine’s renovations at 1900 Market St. are nearly complete. It is still seeking zoning for approval for some exterior improvements and hopes to complete those this year;
• The company’s $28.7 million, 111,000-square-foot built-to-suit for Highway to Health on First Avenue in King of Prussia, Pa., is on schedule to be completed during the second quarter;
• Brandywine’s portfolio in Philadelphia’s Central Business District is 98 percent leased and saw 207,000 square feet of absorption last year. Future lease expirations on its CBD portfolio has shrunk down to 136,000 square feet for this year and 453,000 square feet in 2018. Brandywine saw rent growth between 4 percent and 5 percent with its properties along Market Street West; and
• For the first time in a long time, it will have some large blocks of space come available beginning in July in Radnor, Pa., which is one of the tightest office submarkets in the reigion.

“But we feel great about having inventory in Radnor,” said George Johnstone, executive vice president in the conference call. “It’s one of the things that we haven’t had for a number of years and with our additional lease up in King of Prussia, we think we’re sitting in a good spot in the Pennsylvania suburbs.”

Source: Philadelphia Business Journal