Tag Archives: Jason Wolf


Landlord Issues from Tenant Bankruptcies

Landlord Issues for Tenant BankruptciesTenant bankruptcies are creating headaches for landlords. RadioShack. Brookstone. Toys R’ Us. Sears. With fifteen major retail bankruptcies filed last year in 2018, the toppled retail behemoth has almost become a cliché, and brands once courted by commercial landlords have become major sources of risk. With no sign of a slow-down, this article provides a refresher on your rights, as a commercial landlord, in commercial tenant bankruptcies.

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Commercial Tenant Bankruptcies 101: THE BASICS

• Ipso facto clauses in a lease, which trigger default or acceleration upon the filing of a bankruptcy case, are generally unenforceable under the Bankruptcy Code. Thus, you cannot terminate a lease or stop performing your obligations under the lease on account of the bankruptcy filing.

• The filing of a bankruptcy case triggers the automatic stay, which requires all actions to enforce the lease, evict the tenant or collect a debt (including unpaid rent) to cease. Unless you have a judgment to possess the subject premises, or the lease has otherwise expired by its terms, you must not continue to pursue collection or enforcement activities.

• A commercial debtor may assume a lease and assign it to a third party, in most circumstances without your consent, even if the lease requires the consent of the landlord to assignment.

• A commercial debtor may reject a lease based on its business judgment, and you have very few (virtually no) grounds on which to object to a lease rejection.

Commercial Tenant Bankruptcies 201: WHEN WILL I GET PAID AND HOW MUCH?

The Bankruptcy Code requires bankrupt tenants to continue paying rent under the lease during the pendency of the case (post-petition rent). If a debtor does not assume a lease within 210 days of the commencement of the bankruptcy case, the lease is deemed rejected.

Depending on whether the lease is assumed or rejected and the financial health of the bankruptcy estate, rent that was unpaid as of the date of the filing (pre-petition rent) may be paid in full, in part or not at all. Tenants under assumed leases must cure all breaches under the lease, including to pay in full all unpaid pre-petition and post-petition rent and any damages incurred as a result of the breach of the lease. The cure amounts must be paid at the time the lease is assumed by the debtor or its assignee.

Landlords under rejected leases, on the other hand, are entitled to a claim against the bankruptcy estate, which, depending on the financial health of the debtor, may be paid in full, in part or not at all. While unpaid postpetition rent constitutes an administrative (or dollar-for-dollar) claim against the estate, all other pre petition rent and damages caused by the rejection of the lease constitute unsecured (often, cents-on-the-dollar) claims, and will be paid pro rata with other unsecured creditors. Further, while rejection damages include the amount of rent remaining in the life of its lease, damages are statutorily capped at the greater of one year of rent or the rent for 15% of the remaining term of the lease, not to exceed three (3) years. Landlords who successfully mitigate their damages and re-let the premises may not be entitled to any claim if the rent received under the new lease is greater than or equal to the rent under the existing lease. Payments on unsecured claims are typically paid, if at all, after the debtor has confirmed a plan of reorganization.

Commercial Tenant Bankruptcies 301: DO I HAVE TO ACCEPT A RENT REDUCTION?

Bankruptcy affords the debtor tenant a unique opportunity to re-negotiate its leases. On one hand, the Bankruptcy Code prohibits the debtor from cherry picking which provisions of a lease it wants to assume and which provisions it would like to reject; instead, the Code requires the debtor to assume or reject the lease in its entirety. On the other hand, many debtor tenants leverage the specter of potential rejection to obtain significant rent concessions from landlords. Rent reduction negotiations often begin in the pre-bankruptcy period and continue in the early days of the case, with landlords being told that failure to negotiate will result in certain rejection.

You do not have to negotiate with the debtor tenant or accept a rent reduction, though doing so may increase the possibility of the assumption of your lease. Debtor tenants are more likely to reject leases:

• Not essential to the continued operation of the business,
• With above-market rent,
• In areas saturated with other debtor locations, or
• With low-performing stores.

If your lease falls outside of these categories, then the debtor may assume the lease even without obtaining a rent (or other) concession.

Commercial Tenant Bankruptcies THE BIG PICTURE

As soon as a tenant shows signs of financial weakness, consider actively pursuing remedies under the lease, including termination or eviction proceedings. If the lease has expired or you have already obtained a judgment for possession when your tenant has filed for bankruptcy, tear up this article! (after confirming with your attorney that the lease is, in fact, properly terminated).

If the lease has not expired or terminated at the time of filing, be sure to engage bankruptcy counsel to review the proceedings and protect your interests in the case. Bankruptcy counsel will object to any insufficient cure amount, file a proof of claim for your damages and review any plan of reorganization to advise you of your
anticipated recoveries. Even though retail bankruptcies have become commonplace, sound counsel will ensure
that your rights are protected and help you get paid.

Finally, engage competent real estate professionals, who can provide an accurate assessment of current market
rent and assist in finding a replacement tenant to satisfy and requirement that you mitigate your damages
after rejection/termination of the lease.

The contents of this article are for informational purposes only and none of these materials is offered, nor should be construed, as legal advice or a legal opinion based on any specific facts or circumstances.

 

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WCRE ADDS FORMER DALLAS COWBOY TO TEAM

Phil Costa to Serve Philadelphia & Southern NJ Markets

Phil CostaWolf Commercial Real Estate (WCRE) is pleased to announce the hiring of sales associate Phil Costa. Costa comes to WCRE from the sales and customer service field at Abbott, where he worked after a four-year NFL football career. 

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Costa will focus and specialize in commercial and multifamily assets in the Southern New Jersey and Philadelphia regions. Phil has developed a wide network of business and corporate relationships throughout the area and will focus to help landlords, investors and users develop strategies to achieve their commercial real estate goals. 

Costa, a Holy Cross Preparatory Academy and University of Maryland alumni, recently finished his MBA at Columbia University. His areas of expertise include multi-family, investments and relationship development.   

“Costa will be responsible for advising and supporting a diverse client base throughout their various commercial real estate transactions and needs.  His hiring brings WCRE, which is approaching their 8-year anniversary, to a team of 26 outstanding commercial real estate service providers”,

said Jason Wolf, founder and principal of WCRE. 

“Our people have always been our biggest asset and differentiator in the marketplace.”

Said Chris Henderson, Vice president and principal of WCRE.  

Phil was a Team Captain and two-time Academic ACC student at the University of Maryland and spent four years with the Dallas Cowboys as an Offensive Lineman. Most recently, Phil co-authored the book, “The Transition Playbook for Athletes”. He lives in Philadelphia, PA.

Costa is a licensed salesperson in New Jersey and Pennsylvania license candidate. 

About WCRE

WCRE is a full-service commercial real estate brokerage and advisory firm specializing in office, retail, medical, industrial and investment properties in Southern New Jersey and the Philadelphia region. We provide a complete range of real estate services to commercial property owners, companies, banks, commercial loan servicers, and investors seeking the highest quality of service, proven expertise, and a total commitment to client-focused relationships. Through our intensive focus on our clients’ business goals, our commitment to the community, and our highly personal approach to client service, WCRE is creating a new culture and a higher standard. We go well beyond helping with property transactions and serve as a strategic partner invested in your long-term growth and success.

Learn more about WCRE on Twitter & Instagram @WCRE1, and on Facebook at Wolf Commercial Real Estate, LLC. Visit our blog pages at www.southjerseyofficespace.com, www.southjerseyindustrialspace.com, www.southjerseymedicalspace.com, www.southjerseyretailspace.com, www.phillyofficespace.com, www.phillyindustrialspace.com, www.phillymedicalspace.com, and www.phillyretailspace.com.

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Common Commercial Leasing Mistakes

Common Commercial Leasing MistakesLet’s look at 10 common commercial leasing mistakes and how to avoid them. Commercial leasing transactions are among the longest term contracts parties will ever enter into, yet many often take the cavalier attitude that “it is just a lease.” That lack of focus and attention to detail often leads to mistakes that can haunt the parties for years and waste valuable time and money.

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Ten Common Commercial Leasing Mistakes and Suggested Tips:

1. Incorrect Names of the Parties
The parties’ names must be clearly and precisely listed but have errors a shocking number of times, as either the landlord’s name, the tenant’s name or both are often incorrect. These mistakes cast potential doubts regarding the validity and enforceability of the lease agreement and raise possible defenses. If you end up in such a situation, a lease amendment should be signed that expressly ratifies all of the lease terms and acknowledges the prior error(s). Avoid such situations by verifying the parties’ names by searching New Jersey and Pennsylvania corporate websites, which can be completed within a minute free of charge. Obtaining copies of filed certificates of incorporation, certifications of formation and the like will also help verify that the parties’ names are correctly shown. Further, a short form good standing certificate or a  subsistence certificate can be obtained online in a few minutes at a nominal cost.

2. Parties No Longer Exist
Entities to lease transactions (whether landlord or tenant or their successors or assigns) may be dissolved. Thus, the parties should conduct basic due diligence and verify the facts on an ongoing basis. Obtaining good standing or subsistence certificates could be helpful in this regard. If, for example, a good standing certificate indicates that annual reports and related fees are overdue, that party should be compelled to file such reports and pay such fees to avoid being involuntarily suspended by the State. If a party has already been dissolved voluntarily or involuntarily, they should be required to get their “organizational house” in order, and then lease instruments can be signed.

3. Your Lease is Actually a Sublease
Tenants should consider obtaining title searches to verify ownership of the property by the landlord indicated in the lease documents, or at the very least by asking for copies of deeds, tax records and title polices from their landlords. Otherwise, a tenant may not know that its lease is actually a sublease, which is more common than one might think. If you are a subtenant and not a tenant, your landlord cannot grant to you any rights that do not exist under the master lease and, therefore, you cannot understand your rights unless and until you review the applicable master lease.

4. Authorized Parties Do Not Sign or Incorrectly State their Title
Only an individual authorized to bind an entity should be signing documents on its behalf, and the signer’s name and title should be clearly shown. Such basics are commonly disregarded and the parties simply assume that whoever has signed the lease is an authorized signer. You should consider requesting copies of Operating Agreements, Shareholder’s Agreements and applicable consents and resolutions to confirm that an authorized person is signing. The lease documents should also explicitly represent that the person signing this lease document on behalf of each party is duly authorized to bind such party. If an agent is signing on behalf of the landlord, ask for evidence of authority in the form of a signed agency agreement granting such powers. Finally, make sure that the title of the signer matches the type of entity that is being bound. General partnerships have General Partners; limited partnerships have General Partners and Limited Partners; corporations have officers (i.e. typically President, Vice President, Secretary and Treasurer) and limited liability companies most commonly have Managers or Managing Members.

5. Premises Size Not Indicated
The size of the premises should be indicated, especially when the lease document indicates a rental rate on a square foot basis or requires pass throughs based on a proportionate share of the building or center.

6. Blanks in the Documents
Do not leave any blanks in the documents. Aside from simply looking sloppy, such blanks may be crucial in terms of triggering contractual milestones (e.g. lease commencement date, rent commencement date, timing to complete landlord’s work and the timing for the tenant to submit plans and to open for business). In a worst case scenario, document blanks could give rise to questions and disagreements regarding enforceability.

7. Lender and Other Required Approvals Were Not Obtained
Landlord’s loan documents may require lender’s approval prior to entering into any lease or lease amendments, and it is easy to forget to obtain such approval. Landlords should reach out to their lender(s) as soon as the lease is agreed upon so that the deal does not get derailed by delays. Tenants should ask for evidence of such lender approvals and representations that all required third party approvals have been obtained (or are not necessary). The parties should also check for rights of first refusal (ROFR), rights of first offer (ROFO), use and building restrictions in leases granted to other tenants.

8. Unclear if Prior Tenant Parties and Guarantors Remain Liable After Assignment
Original tenant parties and guarantors often remain liable for lease obligations even after there has been an assignment of a lease, barring negotiated releases. However, such continuing liability is often unclear to the responsible parties, including tenants that sold their businesses. Lease assignment and consent documents should clarify the scope and extent of the parties’ liability.

9. Unexpected Zoning Board, Planning Board or Other Approvals
It is not uncommon for leasing parties to discover after signing that unanticipated approvals are needed (such as from the zoning board or planning board), which can delay occupancy by months or longer and result in significant expense. Signage and other approvals may also be necessary. Ideally, the parties would perform due diligence of the zoning code and obtain copies of prior approvals granted prior to entering into the lease, and then allocate their respective responsibilities, obligations and related costs between them.

10. Failure to Utilize Professionals
There is no such thing as a standard lease, and the parties must ensure that the documents being negotiated and signed reflect their mutual understandings. Landlords and tenants would be wise to utilize experienced and qualified professionals such as commercial real estate brokers with local knowledge to assist in the leasing process. They would also be prudent to choose an attorney with significant leasing experience, good judgment and a reputation for getting deals done.

CONCLUSION:

A leasing transaction is one of the longest term contracts most parties will ever sign, typically lasting five years or longer. Some landlords and tenants take the attitude that “it is just a lease” (and therefore not a big deal) and do not pay requisite attention to the key basics of any contract, and those basic deal terms are wrong in an astonishing number of deals. The most common commercial leasing mistakes, such as incorrectly naming the parties, leaving blanks that potentially impact the rent commencement date and other key milestones and incorrectly stating a signer’s title are shockingly common. Landlords and tenants should take their time to get the deal as reflected in the lease documents precisely right, and avoid common mistakes such as those listed above, the majority of which can be avoided without significant expense by simply paying attention to the details.

Kenneth M. Morgan is an experienced leasing attorney licensed in Pennsylvania and New Jersey.

The contents of this article are for informational purposes only and none of these materials offered are, nor should be construed as, investment advice, legal advice or a legal opinion based on any specific facts or circumstances.

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WCRE HELPS FEED THE COMMUNITY WITH 6th ANNUAL THANKSGIVING FOOD DRIVE

Wolf Commercial Real Estate (WCRE) wrapped up its sixth annual Thanksgiving Food Drive today by delivering over 100 bags of food and $1,525 in supermarket gift cards and donations to the Samost Jewish Family and Children’s Service food pantry.

As in previous years, the firm spent the past several weeks collecting food and grocery store gift cards from friends, clients, and colleagues throughout the region. More than thirty-five area businesses contributed to the effort.

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“Over the past six plus years, WCRE has become an integral charitable partner in our efforts,” said Marla Meyers, MSW, executive director of Samost Jewish Family and Children’s Services of Southern New Jersey. “We thank the entire WCRE team for their generosity and leadership today and throughout the year.”

The food drive is part of WCRE’s Community Commitment program, which also includes donating a portion of the proceeds from transactions to one of several local charities.

In 2016, WCRE formed The WCRE Foundation to manage and oversee our community fundraising efforts and donations.  To date, The WCRE Foundation has successfully raised approximately $315,000 from its community efforts.

Currently, WCRE and The WCRE Foundation support Bancroft, CARES Institute at Rowan University, the American Cancer Society, Susan G. Komen Foundation, Samaritan Healthcare & Hospice and the Jewish Federation of Southern New Jersey. We also offer our clients the option to designate the charitable portion of their transaction to a charity of their choice.

About WCRE

WCRE is a full-service commercial real estate brokerage and advisory firm specializing in office, retail, medical, industrial and investment properties in Southern New Jersey and the Philadelphia region. We provide a complete range of real estate services to commercial property owners, companies, banks, commercial loan servicers, and investors seeking the highest quality of service, proven expertise, and a total commitment to client-focused relationships. Through our intensive focus on our clients’ business goals, our commitment to the community, and our highly personal approach to client service, WCRE is creating a new culture and a higher standard. We go well beyond helping with property transactions and serve as a strategic partner invested in your long term growth and success.

Learn more about WCRE at www.wolfcre.com, on Twitter & Instagram @WCRE1, and on Facebook at Wolf Commercial Real Estate, LLC. Visit our blog pages at www.southjerseyofficespace.com, www.southjerseyindustrialspace.com, www.southjerseymedicalspace.com, www.southjerseyretailspace.com, www.phillyofficespace.com, www.phillyindustrialspace.com, www.phillymedicalspace.com and www.phillyretailspace.com.

About JFCS

To learn more about JFCS’ efforts, visit https://jfcssnj.org/

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Avoiding Exposure for Commercial Real Estate Developers

Avoiding Exposure for Commercial Real Estate Developers

Commercial real estate developers and owners of recently completed development projects should be aware of a few things that can be done after the ribbon cutting to prevent headaches later on, avoid exposure to potential penalties for failing to comply with certain development conditions, and possibly put some money back in the till. Attention should be paid to these three issues after a project is completed.

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OBTAIN AN AS-BUILT SURVEY OF YOUR PROJECT.

An as-built survey is a detailed land survey that includes exact locations of subsurface infrastructure such as pipes and foundations. Sometimes owners rely on contractor notes that have been scribbled on design plans in the field during construction to serve as an as-built. Incorporating these notes in a clean and accurate as-built survey is well worth the time and expense as it will save headaches trying to piece information together later.
An as-built survey should be prepared immediately after the project has been completed. A purchaser might also consider procuring an as-built if one is not available. Some might view this an unnecessary expense; however, consider the following:

1) what is actually built by the contractor in the field doesn’t always line up exactly with the engineering design plans;

2) preparing a clean survey to document as-built conditions immediately after construction eliminates the time consuming and often costly effort required to piece together the information at a later date; and

3) if, at a later date, you want to make improvements or put an addition on the property, having an accurate as-built survey of existing conditions shows exactly where everything is on your site and expedites the process.

As an example of how an accurate as-built survey can save time and money, consider a scenario in which an owner wishes to construct an addition to an existing building and tie a new sewer lateral into an existing underground sanitary sewer force main. The design plans for the addition are developed based on the original design plans for the main building rather than an as-built survey, because the owner never had an as-built survey completed after construction. The design plans for the addition referenced an ‘approximate’ location of the force main, as the ‘exact’ location was never documented. What if that force main was not in the location indicated
on the design plans? If not, it would require a lot of digging and an expensive subsurface utility investigation to locate the pipe to determine the exact location. This costly delay could be avoided if the owner invested in a complete and accurate as-built survey of the property immediately after construction, including the location of all underground infrastructure.

MAKE SURE YOUR NJDEP PERMITS (INCLUDING YOUR WETLANDS LOI) WERE RECORDED WITH THE COUNTY CLERK

Many landowners and commercial real estate developers understand the need to obtain permits from the NJDEP to make improvements to land in New Jersey. However, compliance with administrative permit conditions is sometimes overlooked. One of the conditions of all permits that are issued by the NJDEP under the Freshwater Wetlands Protection Act Rules (Rules), N.J.A.C. 7:7A, is that permits must be recorded with the Office of the County Clerk (or the Registrar of Deeds and Mortgages, if applicable) where the site is located. Permits must be recorded within 30 calendar days of receipt (for activities taking place in only one county) and within 90 calendar days of receipt (for activities within two or more counties). A copy of the recorded permit must be forwarded to the NJDEP. Recently, as of July 2019, NJDEP has also required that freshwater wetland delineations and verifications must also be recorded. As
stated in the Rules, within 90 calendar days after the NJDEP issues a wetland delineation or verification letter of interpretation on a privately owned lot, or on a publicly owned lot other than a right-of-way, the recipient of the delineation or verification shall submit certain information to the Office of the County Clerk or the registrar of deeds and mortgages in which the site is located, and shall send proof to the NJDEP that this information was recorded on the deed of each lot referenced in the delineation or verification letter of interpretation.

It is important that this condition is not overlooked, as the NJDEP has the authority to take enforcement action if permit conditions are not met. As stated in the Rules, any noncompliance with a permit constitutes a violation of the NJDEP rules and is grounds for enforcement action under N.J.A.C. 7:7A-22, which includes potential penalties and suspension and/or termination of a permit. In the case of a wetland delineation or verification letter of interpretation, termination of a permit may mean having to re-delineate the wetlands which can be expensive, time-consuming, and subject to a new interpretation.

CLOSE OUT YOUR ESCROW ACCOUNTS AND REQUEST RELEASE OF PERFORMANCE GUARANTEES

Under the Municipal Land Use Law, N.J.S.A. 40:55D-1 et seq. (MLUL), there is a specific process for closing out escrow accounts and requesting release of performance guarantees. For application review escrow accounts, once the approving authority has signed the subdivision plat or site plan, or for inspection escrow accounts, once the work is completed, the commercial real estate developers are to send a written notice by certificated mail to the chief financial officer (CFO) of the municipality, to the approving authority, and to the relevant municipal professionals. After such notice is transmitted to the appropriate parties, the professionals are to submit a final bill to the CFO of the municipality within 30 days, with a copy to the developer. The CFO of the municipality must render a written final accounting to the commercial real estate developer on the uses to which the deposit was put within 45 days of receipt of the final bills. Any balances remaining in the deposit or escrow account, with any interest, must be refunded to the developer along with the final accounting. See N.J.S.A. 40:55D-53.2.

For performance guarantees, upon substantial completion of all required street improvements (except for the top course) and appurtenant utility improvements, and the connection of same to the public system, the commercial real estate developers may submit a request by certified mail to the governing body to the attention of the municipal clerk, with a copy to the municipal engineer, for the municipal engineer to prepare a list of all uncompleted or unsatisfactory bonded improvements. That request should specify which of the bonded improvements have been completed or remain uncompleted in the opinion of the developer. In response to the request the municipal engineer is to inspect all bonded improvements and submit a detailed list and report, in writing, to the governing body, with a copy to the developer, within 45 days after receipt of the request. Simply put, depending on the outcome of the inspection, the performance guarantee may be either released or reduced by a specific amount, commensurate with the remaining work. If the municipal engineer fails to send or provide the list and report as requested within 45 days from receipt of the request, the commercial real estate developer may seek a court order compelling the engineer to provide the list and report within a set time and may also be reimbursed for the cost of applying to the court, including reasonable attorney’s fees. See N.J.S.A. 40:55D-53.

Following up on these three issues after a project is completed can save time, money and headaches. For more information on any of these topics, contact Rod Ritchie or Bob Baranowski for assistance.

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Just What is Title Insurance Anyway

Just What is Title Insurance AnywayWhat is title insurance? Title insurance has been around for hundreds of years, yet most people still do not truly understand the what is title insurance, what is its purpose and what is it there for. You know you need it to buy or refinance a property. It can cost a lot depending on price of your property or loan amount. But what does title insurance really do for you and do you really need it?

You should always protect yourself by purchasing a title insurance policy. Title insurance is an agreement to indemnify against damage or loss from a defect in title as evidenced by a policy of title insurance to a specific parcel or real property.

Just What is Title Insurance Anyway (PDF Download) >>>

What is Title Insurance and How Does It Function?

There are two types of policies available: Owners Policy and Loan Policy. An owner’s policy insures an owner of any type of real property against loss by reason of those matters covered under the policy of insurance for as long as they own that property. A lender’s policy insures the lender has priority by way of a security instrument that protects them over claims that others may have in the property.

For example, let’s say you are looking to buy a property that has an old mortgage showing up on public records that was given to the current owner 20 years ago. Mr. Seller is saying it was paid off a long time ago. If you purchased your property without title insurance from that seller and the lender whose mortgage was still showing up on title comes knocking on your door for final payment because Mr. Seller lied, guess who will be losing their home to a potential foreclosure? YOU.

You see, with title insurance, we review the history of public records that include mortgages, judgments, liens, and other encumbrances that may affect your property after you purchase it. We minimize the risk by addressing all the potential issues that could become claims and eliminate them so that we can provide free and clear title to you, the buyer.

Title companies provide a number of services to all of the parties in a real estate transaction. Not only do they provide the final title policy which is the ultimate proof of insurance on the property, they also provide assurances that the transfer of title takes place in a timely manner and that the interest of the buyers and lenders are protected under the terms and conditions of the policy. One major responsibility of a title company is ensuring that all parties receive their funds efficiently and securely.

Title insurance is different from other lines of insurance that most people are familiar with (homeowners, car insurance, etc). These other types of insurances assume risks providing financial protection for losses that may arise from an unforeseen future event such as a fire, theft or accident. With title insurance, you pay a one-time premium at the time of closing, unlike the other types of insurance which are typically paid on an annual basis.

For more information on title insurance, please visit our website at: www.deedsearchers.com

Nicole Malcolm

 

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Depreciation Tax Breaks: Time to Take Advantage

bonus depreciation

100% first-year bonus depreciation is available for qualified new and used property that is acquired and placed in service in calendar-year 2019. That means your business might be able to write off the entire cost of some or all of your 2019 asset additions on this year’s return. So, consider making additional acquisitions between now and year-end. Contact your tax professional for details on the 100% bonus depreciation break and what types of assets qualify.

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Other Uses for 100% bonus depreciation

Not just for your properties but the 100% bonus depreciation provision can have a hugely beneficial impact on first-year depreciation deductions for new and used heavy vehicles used over 50% for business. That’s because heavy SUVs, pickups, and vans are treated for tax purposes as transportation equipment that qualifies for 100% bonus depreciation. However, 100% bonus depreciation is only available when the SUV, pickup, or van has a manufacturer’s Gross Vehicle Weight Rating (GVWR) above 6,000 pounds. The GVWR of a vehicle can be verified by looking at the manufacturer’s label, which is usually found on the inside edge of the driver’s side door where the door hinges meet the frame. If you are considering buying an eligible vehicle, doing so and placing it in service before the end of this tax year could deliver a juicy write-off on this year’s return.

You can also claim first-year depreciation deductions for cars, light trucks, and light vans you use in your business. For both new and used passenger vehicles (meaning cars and light trucks and vans) that are acquired and placed in service in 2019, the luxury auto depreciation limits are as follows:

• $18,100 for Year 1 if bonus depreciation is claimed.
• $16,100 for Year 2.
• $9,700 for Year 3.
• $5,760 for Year 4 and thereafter until the vehicle is fully depreciated.

Note that the $18,100 first-year luxury auto depreciation limit only applies to vehicles that cost $58,500 or more. Vehicles that cost less are depreciated over six tax years using percentages based on their cost. You should cash in on generous Section 179 deduction rules. For qualifying property placed in service in tax years beginning in 2019, the maximum Section 179 deduction is $1.02 million. The Section 179 deduction phase-out threshold amount is $2.55 million.

The Section 179 deduction may be claimed for personal property used predominately to furnish lodging or in connection with the furnishing of lodging. Examples of such property include furniture, kitchen appliances, lawn mowers, and other equipment used in the living quarters of a lodging facility or in connection with a lodging facility such as a hotel, motel, apartment house, dormitory, or other facility where sleeping accommodations are provided and rented out.

Section 179 deductions can also be claimed for qualifying real property expenditures. Qualifying real property means any improvement to an interior portion of a nonresidential building that is placed in service after the date the building is first placed in service, except for expenditures attributable to the enlargement of the building, any elevator or escalator, or the building’s internal structural framework. The definition also includes roofs,

HVAC equipment, fire protection and alarm systems, and security systems for nonresidential real property. To qualify, these items must be placed in service after the nonresidential building has been placed in service. Here is another area where the advice and skill of your CPA and your tax lawyer, can make a difference in your business. Leasing or buying/selling real estate? Well, add WCRE to the team.

FOR MORE INFORMATION:

Martin H. Abo, CPA/ABV/CVA/CFF is a principle of Abo and Company, LLC and its affiliate, Abo Cipolla Financial Forensics, LLC, Certified Public Accountants – Litigation and Forensic Accountants. With offices in Mount Laurel, NJ and Morrisville, PA, tips like the above can also be accessed by going to the firm’s website at www.aboandcompany.com.

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WCRE EXPANDS REGIONAL TEAM WITH ANOTHER TRIO OF NEW HIRES

Team Members to Serve Philadelphia and Southern/Central New Jersey Markets

Wolf Commercial Real Estate (WCRE) is pleased to announce the hiring of three new professionals serving its southeastern Pennsylvania and Southern/Central New Jersey teams.

The new hires are Christopher Jerjian, who joins WCRE as Business Advisor & Consultant, Sean Kelly, a new sales associate, and Victor DeJesus, Senior Associate with a focus in the Central New Jersey market.

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Christopher JerjianChris Jerjian specializes in office and other commercial properties in Southern and Central New Jersey and the Philadelphia Region. He has developed a wide network of business relationships over a thirty-year career as a CRE landlord and investor. His focus is to help landlords, investors and users develop strategies to achieve their goals.

He is also the founder of Kiwi Offices in Mount Laurel, New Jersey. Kiwi Offices provides flexible and move-in ready office suites focused on small businesses, professionals and satellite offices for corporations. He is currently developing a second location in Cherry Hill, with a longer-term plan to roll out more locations.

Previously Jerjian was responsible for strategy development and leasing of office space as a co-founder, principal, and managing director of the Ibis Group. He has closed more than 300 office space deals with local, regional, and national companies as a commercial landlord. His completed deals span large multi-million dollar transactions with Fortune 500 companies to small independently owned businesses. He has served on several corporate boards over the years and is a member of the Hamilton Partnership in New Jersey. He also worked with multiple non-profits over the years, including Catholic Charities.


Sean KellyAs sales associate, Sean Kelly will focus on the Pennsylvania and New Jersey markets. He specializes in sales and leasing, tenant and landlord representation for office, investment sales, and industrial properties. Previously, Kelly sold medical devices at Stryker Orthopedics, where he was responsible for growing their trauma orthopedic business in the Philadelphia region. Working with all major health systems in the area, he was responsible for driving growth, customer engagement, account management, and operational efficiency.

Kelly was also a pitcher for the Rutgers University baseball team between 2014 and 2016. During his time as a student athlete, he contributed four years of volunteer services to St. Peters Childhood Cancer programs.


Sean KellySenior Associate Victor DeJesus previously worked at KW Commercial, out of their Princeton and Moorestown, New Jersey offices. Victor has also worked for major public relations and advertising companies. Victor was a top 1% producer and has helped many of his clients reach the next level in business performance. As a senior sales associate, Victor will focus on the Central New Jersey market. He specializes in sales and leasing, tenant and landlord representation for office, investment sales, and industrial properties.


“Our entire firm is excited to have such talented new team members servicing our clients in the region,” said WCRE Managing Principal, Jason Wolf. “Our people have always been our biggest asset and our biggest advantage in the marketplace.”

About WCRE

WCRE is a full-service commercial real estate brokerage and advisory firm specializing in office, retail, medical, industrial and investment properties in Southern New Jersey and the Philadelphia region. We provide a complete range of real estate services to commercial property owners, companies, banks, commercial loan servicers, and investors seeking the highest quality of service, proven expertise, and a total commitment to client-focused relationships. Through our intensive focus on our clients’ business goals, our commitment to the community, and our highly personal approach to client service, WCRE is creating a new culture and a higher standard. We go well beyond helping with property transactions and serve as a strategic partner invested in your long-term growth and success.

Learn more about WCRE on Twitter & Instagram @WCRE1, and on Facebook at Wolf Commercial Real Estate, LLC. Visit our blog pages at www.southjerseyofficespace.com, www.southjerseyindustrialspace.com, www.southjerseymedicalspace.com, www.southjerseyretailspace.com, www.phillyofficespace.com, www.phillyindustrialspace.com, www.phillymedicalspace.com, and www.phillyretailspace.com.

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Why Smart Buildings Matter to Commercial Real Estate Owners

smart buildings energy consumptionLet’s look at why smart buildings matter to commercial real estate owners. Energy cost savings are top of mind for every commercial building owner, operator, and facility manager, but it’s time to be proactive. On average, a U.S. office building spends nearly 29% of its operating expenses on utilities, and much of this expenditure goes toward HVAC operation.

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Researchers at Massachusetts Institute of Technology (MIT) estimate commercial buildings account for 20% of all the energy used in the U.S. and conclude that as much as 30% of that energy is wasted. Wasted energy will only increase over time without intervention. Imagine a solution that prevents waste and saves 15-30% on energy expenses? That’s possible to achieve with smart buildings.

Smart buildings are any facility that have complete automated controls and systems in place that are integrated together to form an intelligent data collection application, usually via a building automation system (BAS).
BAS offers reduced operation and energy consumption, improved building efficiency, preventative maintenance, comfort for workers and building occupants, and better use of resources.

At Pennoni, we offer our Utilities Watch (UW) solution, a combination of best-in-class energy analytics/fault detection software and engineering expertise that optimizes buildings, reduces costs, and minimizes environmental impact.

Through UW, our software continually analyzes data from diverse systems: BAS, energy, water, and other resource metering systems to identify opportunities for cost reduction. The fault detection and diagnostics application within the software drills down into patterns to identify issues, deviations, and opportunities for operational improvements and cost reduction.

Utilities Watch Key Benefits

Reduce costs

  • Optimize buildings and reduce energy consumption
  • Increase control and visibility of energy budget
  • Decrease maintenance and capital costs through proactive and predictive maintenance
  • Increase lifespan and reliability of HVAC systems

Validation and M&V

  • Performance goals
  • ECM’s, LEED

Commissioning

  • MBCx – automated ongoing commissioning

Risk Management

  • Disaster recovery (information supports better identification of issues)

Improve sustainability strategies, goals, and metrics

  • Full integration to EnergyStar Portfolio Manager
  • Earn additional LEED points for existing buildings

Improve portfolio management

  • Benchmark buildings and compare performance
  • Performance accountability

Deploying smart buildings software is only half of the equation. Our energy analysts and engineers write custom algorithms to automate analyses that traditionally required constant manual effort. From there, our team of engineers interprets the data to make it meaningful and actionable with custom dashboards and notifications that ensure the facility manager has full visibility and can readily prioritize activities, ensuring much greater efficiency.

For more on smart buildings and Utilities Watch, contact Tony Lepre at (609) 214-5520 or TLepre@Pennoni.com.

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Fourth Annual WCRE Celebrity Charity Hockey Game Raises $78,000

The Fourth Annual WCRE Charity Hockey Game was a huge success, raising $78,000 to be shared by several charitable causes.

The game, which was played At the Flyers Skate Zone in Voorhees this past Saturday, is the brainchild of Philadelphia Flyer legend and WCRE director of strategic relationships Brian Propp. Blending community fun with sports fantasy camp, WCRE brought several Flyers Alumni fan favorites back to the ice for a game alongside thirty area business leaders. Over its four years, the WCRE Foundation has successfully raised $315,000 from its community fundraising efforts which also includes its annual golf event. 

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Joining The WCRE Foundation for this year’s event were former Flyers Brian Propp, John LeClair, Riley Cote, Doug Crossman, Andre Faust and Todd Fedoruk.  Philadelphia Sports Hall of Fame inductee Lou Nolan, public address announcer of the Philadelphia Flyers, served as emcee. This year Kerry Fraser served as referee. Fraser was a referee in the NHL for 30 seasons, including officiating 12 different Stanley Cup Finals series.

All proceeds from the event will be shared among Bancroft, the American Cancer Society, CARES Institute at Rowan Medicine, the Jewish Federation of Southern New Jersey, Philadelphia Flyers Alumni Association, Samaritan Healthcare and Hospice and Susan G. Komen-Philadelphia.

Additionally, each of these organizations benefits from WCRE’s long-standing practice of donating a portion of its proceeds from transactions to an area charity. Learn more about this program at http://wolfcre.com/community-commitment/.

“This event gets better every year. We had over 100 sponsors, more spectators, more raffle prizes, a $10,000 puck shot contest, and most importantly, more money going to our charitable partners,” said Jason M. Wolf, managing principal of WCRE. “The WCRE team thanks our friends, neighbors, and business associates for their involvement in our efforts to improve the lives of others in the community.”

See a video recap of the game featuring comments from the participants, sponsors, and beneficiaries below:

Donations can still be made @ https://bit.ly/2kPn1tQ

Watch a Video from the Event

2019 WCRE Celebrity Hockey Tournament

 

 

 

About WCRE

WCRE is a full-service commercial real estate brokerage and advisory firm specializing in office, retail, medical, industrial and investment properties in Southern New Jersey and the Philadelphia region. We provide a complete range of real estate services to commercial property owners, companies, banks, commercial loan servicers, and investors seeking the highest quality of service, proven expertise, and a total commitment to client-focused relationships. Through our intensive focus on our clients’ business goals, our commitment to the community, and our highly personal approach to client service, WCRE is creating a new culture and a higher standard. We go well beyond helping with property transactions and serve as a strategic partner invested in your long term growth and success.

Learn more about WCRE on Twitter & Instagram @WCRE1, and on Facebook at Wolf Commercial Real Estate, LLC. Visit our blog pages at: www.southjerseyofficespace.com, www.southjerseyindustrialspace.com, www.southjerseymedicalspace.com, www.southjerseyretailspace.com, www.phillyofficespace.com, www.phillyindustrialspace.com, www.phillymedicalspace.com and www.phillyretailspace.com.

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How to Prepare Your Parking Lot for Winter

How to Prepare Your Parking Lot for Winter

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Did you prepare your parking lot for winter? Most property owners neglect this because many property managers and commercial property owners are unaware of how the winter weather, salt and plowing can cause damage to their parking lot. Winter weather can wreak havoc on a commercial parking lot, specifically in our region. The harsh freeze-thaw cycles cause asphalt to expand and contract, allowing water to seep into the foundation. This creates permanent damage, in the form of cracks and potholes.

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Ways Prepare Your Parking Lot for Winter

Crack Sealing: As a preventative measure, consider filling cracks in the parking lot before they turn into potholes. Longitudinal cracks between ¼” and 1” can be cleaned and filled with hot rubberized material that will expand and contract as the temperature shifts. The crack sealing material creates a bond with the surface of the asphalt pavement, preventing water from penetrating the asphalt.

Asphalt Repairs: Potholes can be repaired with hot mix asphalt in the fall months. Damaged asphalt is saw cut and removed, then the area is cleaned and prepared for the installation of new asphalt. When hot asphalt is unavailable, EZ Street high performance cold asphalt is a great alternative. This material works in cold temperatures, and can even be applied in water. Neglecting potholes, especially in the colder months, can be very dangerous. As the asphalt continues to break apart and the holes become larger and larger, this creates a safety hazard for both pedestrians and vehicles.

Inlet Repairs: When water seeps into your inlets, the inside structure deteriorates. Salt and ice melt used in the winter months also washes into the storm drains, which further erodes the walls. To avoid a potential sinkhole, make sure your catch basins are structurally sound, the interior walls are parged, and the surrounding asphalt is intact.

For more information on ways to prepare your parking lot for winter, contact:

 

david sulkin

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WCRE APPOINTED EXCLUSIVE AGENT TO MARKET 23,427 SQFT AT PLYMOUTH MEETING MALL

PREIT-Plymouth Meeting Mall

PREIT-Plymouth Meeting Mall

WCRE | CORFAC International is pleased to announce that it has been appointed by PREIT as the exclusive office leasing agent to market +/-23,427 square feet at the former Mercy Health Care space located within the Plymouth Meeting Mall in Plymouth Meeting, PA.

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This unique 23,427 square-foot leasing opportunity is already fit out as premier medical space and located directly adjacent to LEGOLAND and Boscov’s. The Plymouth Meeting Mall is finishing an anchor redevelopment that will be bringing Dick’s Sporting Goods, Edge Fitness, and Burlington and will be completed in fall of 2019. The mall has a strategic location at the intersection of four of Philadelphia’s most heavily trafficked roadways featuring over 260,000 vehicles per day. The proximity to I-476 and the Pennsylvania Turnpike provides excellent accessibility to the major employment hubs of Philadelphia, Conshohocken, Blue Bell, Radnor and more with a population of over 5,000,000 people within a 45-minute drive.

Surrounded by brand name retail, state-of-the-art entertainment and numerous restaurants, the Plymouth Meeting Mall offers a great location for a medical user to be adjacent to numerous retail attractions.

“We are excited to continue our partnership with PREIT and to be a part of the anchor redevelopment project at the Plymouth Meeting Mall. PREIT is a first-class retail owner in our region as seen with the vision in the anchor redevelopment project completing at the Plymouth Meeting Mall,” said Jason Wolf, managing principal of WCRE.

WCRE’s Vice President and Principal Chris Henderson, Mitch Russell, and Ty Martin will be working closely with PREIT to facilitate the leasing of this well-trafficked property.

“Offering this fully built out office space adjacent to these sought after amenities including five sit down restaurants, best in class shopping and a full service fitness center, makes this a preferred location for end users looking to capitalize on the synergies afforded by this unique to suburban work/ shop/dine experience” said Joe Aristone, EVP & Head of Leasing PREIT.

A marketing brochure is available upon request and additional information can be found at the links below.

PREIT – The Plymouth Meeting Mall

About WCRE
WCRE is a full-service commercial real estate brokerage and advisory firm specializing in office, retail, medical, industrial and investment properties in Southern New Jersey and the Philadelphia region. We provide a complete range of real estate services to commercial property owners, companies, banks, commercial loan servicers, and investors seeking the highest quality of service, proven expertise, and a total commitment to client-focused relationships. Through our intensive focus on our clients’ business goals, our commitment to the community, and our highly personal approach to client service, WCRE is creating a new culture and a higher standard. We go well beyond helping with property transactions and serve as a strategic partner invested in your long-term growth and success.

Learn more about WCRE at www.wolfcre.com, on Twitter & Instagram @WCRE1, and on Facebook at Wolf Commercial Real Estate, LLC. Visit our blog pages at www.southjerseyofficespace.com, www.southjerseyindustrialspace.com, www.southjerseymedicalspace.com, www.southjerseyretailspace.com, www.phillyofficespace.com, www.phillyindustrialspace.com, www.phillymedicalspace.com, and www.phillyretailspace.com.

About PREIT
PREIT (NYSE:PEI) is a publicly traded real estate investment trust that owns and manages quality properties in compelling markets. PREIT’s robust portfolio of carefully curated retail and lifestyle offerings mixed with destination dining and entertainment experiences are located primarily in the densely-populated eastern U.S. with concentrations in the mid-Atlantic’s top MSAs. Since 2012, the Company has driven a transformation guided by an emphasis on portfolio quality and balance sheet strength driven by disciplined capital expenditures. Additional information is available at www.preit.com or on Twitter or LinkedIn.

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