The Birch Group has acquired a three-property Class A office ensemble in Morristown, N.J. Lincoln Equities Group sold the portfolio for $77 million. Cushman & Wakefield’s Capital Markets Group represented the seller.
The portfolio includes a 156,000-square-foot building at 60 Columbia Drive, the 151,400-square-foot 100 Southgate Parkway and a 106,000-square-foot property at 1200 Mount Kemble Ave. The same three buildings traded in 2015, when Alfieri Property Management sold them for $80 million. Following that deal, Lincoln invested $6.7 million to upgrade the properties, which date back to the 1980s. The new owner plans to further renovate the assets.
Amenities include on-site cafes, cafeterias, fitness centers and landscaped outdoor areas with seating. The current tenant roster includes Morgan Stanley, Verizon and LG. The Birch Group owns another two-building property in the area at 350 and 360 Mount Kemble Ave., which it acquired in 2018 through a joint venture with Vision Properties. Last October, the duo also partnered for the purchase of 180 Park Ave. in Florham Park, N.J., a Class A office property spanning 228,000 square feet.
Lower vacancy amid supply constraints
CommercialEdge’s latest office report shows that office space largely continues to remain empty across the U.S., with the national vacancy rate hitting 15 percent in February, a slight increase from the previous month and a 1.6 percent year-over-year uptick. New Jersey had the smallest office development pipeline across major U.S. markets last month, with less than 500,000 square feet under construction, or 0.2 percent of stock. The market’s vacancy hit 17.9 percent in February, down 4.2 percent from the same time last year.Morris County holds the largest concentration of Fortune 500 companies in the state, David Bernhaut, executive vice chairman of Cushman & Wakefield noted, in prepared remarks. According to The Birch Group, the county has an office vacancy rate of only 3.5 percent.
Source: Commercial Property Executive