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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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Winter Weather and Its Impact On Your Business

Winter weather is unpredictable and can have a large impact on your business. While maintaining business operations is always at the forefront of your mind, it is important to consider employee safety as well. You should have policies and procedures in place before bad weather hits so that your company and employees are as prepared as possible.

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Driving in Winter Weather on Company Time

winter weatherA major concern regarding winter weather is employees who drive a company car or vehicle as part of their workday. All vehicles should be given a safety check by a mechanic before the bad weather hits, and they should also be equipped with emergency materials such as a snow scraper, blanket, first aid kit and
flashlight.

In addition, employees should be instructed to dress properly for the weather, including a hat, scarf and gloves, or have extra clothing on hand in case of a breakdown or accident. In order to protect your company against liability, any employees who may drive in bad weather on company time should be trained in safe, cautious driving techniques and what to do in case of an accident. Also consider employees who drive as part of their commute—it may be wise to educate them in cautious winter driving techniques to ensure their safety while driving to and from work.

Employee Pay During Winter Weather

Pay issues arise when weather forces your business to close for any length of time or prevents employees from making it to work even if your business remains open. For non-exempt (typically hourly) employees, you are only required to pay them for the hours they actually work. Thus, if your business opens late, closes early or closes for an entire day, you are not required to pay them for any time missed.

If an exempt (typically salaried) employee works any part of the day, you must pay them for a full day. Similarly, if the business is closed for a day or more but less than a full week, you need to pay exempt employees their normal salary if they worked any part of that week. You do not need to pay employees if business is closed for a full week. This applies whether your company uses a five-day or seven-day workweek. You may, however, require that they use available paid time off or vacation time, if available. If your business remains open but an exempt employee cannot come in due to weather conditions, this is a personal reason, and you do not need to pay them. One option to ease the loss of a business day or any missed productivity is to ask exempt employees to work from home if you are already paying them for the day. You may also consider offering a telecommuting option during inclement weather even if your business remains open so employees can avoid the dangers of driving in the extreme cold or snow.

Be Prepared for Winter Weather

Employees should be informed of your company policies related to inclement weather—safety, attendance and pay-related. You should have an established communication method to inform your employees of a business closing or delay. When bad weather is coming, address all your policies again, remind employees of communication channels to address attendance and plan for the worst potential outcome to ensure your company is prepared for the weather.

Brian Blaston
Commercial Lines – Manager
Hardenbergh Insurance Group
phone: 856.489.9100 x 139
fax: 856.673.5955
www.hig.net

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WCRE THIRD QUARTER 2019 REPORT

SOLID FUNDAMENTALS WITH MODEST GAINS IN SOUTHERN NEW JERSEY & PHILLY CRE MARKETS

Favorable Economic Conditions Expected to Continue into 2020

SOLID FUNDAMENTALS, BUT MODEST GAINS IN SOUTHERN NEW JERSEY & PHILLY CRE MARKETS

Commercial real estate brokerage WCRE reported in its analysis of the third quarter of 2019 that the Southern New Jersey and Southeastern Pennsylvania markets continued to show modest gains, continued investments, and overall solid fundamentals. Sales volume and prospecting activity held steady, leasing was up in Camden County, and especially in Cherry Hill, but dipped for the region overall. Gross leasing absorption was positive but trending lower quarter over quarter.

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“We are in a continuing period of a strong economy with low unemployment. This has supported a long streak of slow, steady growth supported by strong fundamentals,” said Jason Wolf, founder and managing principal of WCRE. “Although a given indicator might fluctuate one quarter to the next, commercial real estate in this region remains strong, and there is reason to stay optimistic.”

There were approximately 266,867 square feet of new leases and renewals executed in the three counties surveyed (Burlington, Camden and Gloucester), which was a decrease of seven percent compared to the previous quarter. The sales market increased, with about 1.67 million square feet on the market or under agreement. However, completed sales slowed to approximately 329,769 square feet trading hands, less than half the previous quarter, which had been notably active.

New leasing activity accounted for approximately 36 percent of all deals for the three counties surveyed. Overall, gross leasing absorption for the third quarter was in the range 70,000 square feet, down from 150,000 in the second quarter.

Other office market highlights from the report:

Overall vacancy in the market is now approximately 11.50 percent, which is a slight uptick from the previous quarter. This is still near a 20-year low.

Average rents for Class A & B product continue to show strong support in the range of $10.00-$15.00/sf NNN or $20.00-$25.00/sf gross for the deals completed during the quarter. These averages have hovered near this range for more than a year.

Vacancy in Camden County dropped slightly to 11.1 percent for the quarter, back to where it stood in the first quarter.

Burlington County’s vacancy stood at 11.9 percent, increasing 40 basis points. Burlington’s vacancy rate jumped earlier in the year due to several large blocks of space returning to the market.

WCRE has expanded into southeastern Pennsylvania, and the firm’s quarterly reports now include a section on transactions, rates, and news from Philadelphia and the suburbs. Highlights from the third quarter in Pennsylvania include:

The vacancy rate in Philadelphia’s office market dropped slightly to 8.6 percent, the second consecutive quarter to post a decrease of two tenths of a percent. The office vacancy rate is still near a 20-year low, and below that of comparable major cities.

The industrial sector in Philadelphia remains very strong. The third quarter saw vacancy rates virtually unchanged, at 5.0 percent, while net absorption was constrained by a shrinking volume of available space. Rent growth of 6.0 percent has far exceeded long-term average of 1.7 percent.

Philadelphia retail is so far avoiding a major spike in vacancy due to the shift toward e-commerce. Rising wages and low unemployment are fueling retail spending, buoying the CRE market. The vacancy rate inched up to 4.7 percent, while net absorption was negative 562,000 square feet over the last twelve months.

WCRE also reports on the Southern New Jersey retail market. Highlights from the retail section of the report include:

  • Retail vacancy in Camden County jumped to 6.9 percent from 5.7 percent in Q2. While average rents increased in the range of $17.05/sf NNN.
  • Retail vacancy in Burlington County ticked up very slightly, to 7.6 percent, with average rents in the range of $12.68/sf NNN.
  • Retail vacancy in Gloucester County dropped to 7.4 percent, with average rents in the range of $13.41/sf NNN.

The full report is available upon request.

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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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.

tony lepre

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Lightning Safety for Outdoor Workers

lightning safetyLet’s look at lightning safety for your outdoor workforce. Although about 90 percent of people struck by lightning survive, these strikes can cause serious and permanent disabilities. And, even if employees aren’t hurt by lightning, they may be at risk from any fires, explosions or other hazards that result from a strike. Together, these facts outline the importance of protecting employees who work outdoors from lightning hazards.

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There are a number of ways to do this, including taking steps to reduce lightning hazards, creating an emergency
action plan and training your workforce.

All of your managers, supervisors and outdoor workers should collaborate on your plan to ensure it accounts for your business’s unique operations. Consider these tips when you’re drafting your plan:

Train all employees on lightning safety, including early warning systems for severe weather and the best locations to take shelter when working outdoors.

Post information on lightning safety around all of your outdoor work areas. These postings should indicate the location of safe shelters, when to stop and resume work after hearing thunder, and any other guidance that applies to your business or work sites.

Make sure employees check weather reports before working outside. Employees should also check the weather at each work site they’ll be visiting each day, as weather patterns can vary widely—even over short distances.

Require employees and supervisors to monitor weather reports regularly once they’re at an outdoor work site. Have employees stop work and seek shelter immediately if they hear any thunder.

For more resources to help keep your outdoor workers safe, contact Hardenbergh Insurance Group today.

Brian Blaston Hardenbergh

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Preparing Commercial HVAC Systems for Winter

Preparing Commercial HVAC Systems for WinterWith the fall season in full swing, it’s time to start preparing commercial HVAC systems for winter, well before Ol’ Man Winter comes to town. Hutchinson, a leading energy services and mechanical services contractor serving the region’s commercial customers, offers tips to help add life to your systems, enhance comfort and improve your bottom line.

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Is your HVAC system ready for the frigid winter season? Don’t be left out in the cold – take action now to make sure your HVAC systems are running efficiently before the chill sets in. Hutchinson, a leading energy services and mechanical services contractor serving the region’s commercial customers, offers tips to help add life to your systems, enhance comfort and improve your bottom line.

1. Take Advantage of Energy Efficiency Programs. Upgrade to energy efficiency with Direct Install from New Jersey’s Clean Energy Program and up to 70% of the cost will be covered for energy upgrades, including lighting and HVAC equipment. Instead of pumping money into your outdated, inefficient units, why not upgrade to a new, state of the-art energy efficient system?

2. Use Energy Star Portfolio Manager to see how your building rates with other similar buildings. If you rate low, there are many things you can do to improve the operation of your building.

3. Check HVAC settings to get maximum efficiency. By setting your thermostat at 68°during the day and at 60° at night, you can save approximately 3% on heating costs for every degree under 70.

4. Install a programmable thermostat. Forget to adjust the temperature before you left the office? No worries. With a web and cloud based control system during and after office hours, you’ll keep settings maintained. Now, that’s peace of mind!

5. Establish a preventive maintenance program. When your HVAC system runs smoothly, so can your business. Prevent equipment problems before they start!

• Change or clean all air filters, preferably every month.
• Repair leaks in piping, air duct s, coils, fittings and at the unit(s).
• Replace defective equipment insulation, ducting and piping.
• Install/upgrade HVAC controls to include new energy management systems technologies.

6. Clean Heating Ducts Heating ducts periodically to allow efficient heating and provide fresh, clean air. Also check to make sure the ducts are properly insulated.

Contact Hutchinson at 888-777-4501 or dicoordinator@hutchbiz.com for help preparing commercial HVAC systems for winter

About Hutchinson
Hutchinson is a leading energy/mechanical service contractor performing energy services, mechanical construction and retrofit installation work in the Greater Philadelphia Tri-State Region. Hutchinson’s
technicians are factory trained, NATE certified and are on-call 24/7 365 days a year. Visit www.hutchbiz.com for more information.

ed-hutchinson

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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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Understanding New Jersey Liquor Licenses

New Jersey Liquor Licenses

New Jersey Liquor Licenses

Let’s examine the changing landscape of New Jersey liquor licenses. There is no denying the restaurant industry and retail sectors of commercial real estate are undergoing major shifts brought on by changing consumer shopping patterns and tastes. With the rise of e-commerce, the need to visit physical locations has diminished and retailers increasingly need to offer a unique experience or destination in order to attract customers. This, combined with changing dining habits and palates that desire more convenient and varied food and alcohol options, has expanded the alcoholic beverage industry through the country, including in New Jersey.

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With this increased interest and its impact on retail spaces, it is important for landlords, property owners, brokers and other real estate professionals to have a basic understanding of New Jersey liquor licenses.

Restaurants, bars and liquor stores cannot sell, buy or serve alcoholic beverages in New Jersey without the applicable legally required license or permit. There are different categories of New Jersey liquor licenses, but the most relevant for retail purposes are (i) plenary retail consumption licenses, which are used at bars and restaurants to permit the sale of alcoholic beverages for on-site consumption, often referred to as “33” or “32” licenses; and (ii) plenary retail distribution licenses that allow for the sale of alcoholic beverages in original containers for off premises consumption, known generally as package good stores or “44” licenses. In New Jersey, licenses are generally issued and regulated at the municipal level, subject to further approval, oversight and enforcement by the State’s Division of Alcoholic Beverage Control.

The number of retail consumption and distribution licenses available in a municipality is dictated by the size of the population. New licenses can only be issued where updated Federal Census data warrants the creation of a new license, and the local issuing authority must follow specific methods established by New Jersey statute and regulations for awarding a new license. Consequentially, the pool of available licenses in a municipality is limited and the overwhelming majority of New Jersey liquor licenses must be purchased through private transactions. The price for a license is determined by supply and demand, with licenses in highly sought after municipalities being quite expensive. The limited supply and high price of liquor licenses in our State is somewhat unique, with many other jurisdictions having separate beer and wine only licenses widely available for restaurants or quick food concepts. Indeed, because of the way the liquor license industry works in New Jersey, some restaurant concepts that include wine and beer sales in their operating model in other jurisdictions find they are not able to similarly operate in New Jersey because either a license is not available or it is cost prohibitive. Landlords and brokers should be cognizant of this when considering attracting out of state restaurants or other alcoholic beverage businesses to a property.

Existing New Jersey liquor licenses are purchased through a transfer process by which the purchaser files a personto-person transfer application (and a place-to-place application when locating a license at a new premises) with the municipality or other local issuing authority. The local issuing authority then reviews the transfer application and performs due diligence on the purchaser, including investigations and criminal background checks on any individuals holding an interest in the license. Local issuing authorities must confirm that a purchaser is not disqualified from holding an interest in a liquor license, that the transfer does not violate applicable laws, and that the source of the funds used to purchase the license is legitimate. In addition to evaluating a purchaser, notice of the transfer must be published in local newspapers, and the transfer must be scheduled for public hearing and approved by the local issuing authority at the public hearing. A purchaser cannot utilize a liquor
license until its transfer is formally approved by the local issuing authority. Moreover, a transfer cannot be conditionally approved or approved subject to the satisfaction of certain contingencies.

Once a liquor license transfer is approved it cannot be undone except by accomplishing another transfer. Given this process, real estate owners and other professionals must be mindful of timing and should include adequate approval time periods and extension rights in contracts and leases involving liquor licenses. Closings on New Jersey liquor licenses are typically completed in escrow since (1) the purchaser cannot make use of the license until it is approved and thus does not want to pay the purchase price over to the seller until it has received formal approval, and (2) the seller cannot undo a transfer once approved and therefore usually requires that funds be deposited in escrow prior to the hearing to ensure that the purchaser pays for the license. As such, parties should carefully address specific escrow and closing instructions in their agreements. Where a landlord
holds the license and expects it to run with the shopping center, special attention must be paid to the arrangement between landlord and tenant concerning the license at lease expiration or termination.

Besides the more traditional New Jersey liquor licenses discussed above, property owners are increasingly encountering local winery and craft brewery establishments as tenants. These licenses are issued by the State directly and are subject to their own separate regulations. Similar to plenary retail licenses, property owners and others need to be aware of the unique issues present in the alcoholic beverage industry.

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Commercial Building Life Expectancy Isn’t What It Once Was

Commercial Building Life ExpectancyBuilding life expectancy isn’t what it used to be. What to do with obsolete commercial buildings and how to prevent your portfolio from falling into the trap. Buyers, owners, investors and developers of real estate are facing questions regarding how properties are valued in the current market, especially where there are problems appraising a property’s highest and best use. More specifically, this question focuses on reversion value.

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Commercial Building Life Expectancy – Multiple Cases

Recent Class B or lower valuation projects (as well as some lower level Class A properties) have presented serious, widespread questions from a valuation standpoint. The main question is simple: What should be done with “obsolete” buildings?

Historically, such a question became pertinent only after 50-100 years. Buildings were “built to last,” and most were designed to be updated over time. Part of the reason for that long horizon was that ample land was available for expansion. Another was that zoning was very prescriptive and clearly defined in many ways. Lastly, fixed real estate was a capital-intensive asset class.

In the past five years alone, that question, however, is now being asked about buildings that are only 20 to 30 years old. Many buildings that have been constructed in the last 30 years or so, like suburban office buildings and parks, retail centers and malls, some well located industrial parks and even sports stadiums, now face the wrecking ball because they are, effectively, obsolete. Some investors report that many U.S. submarkets, for a variety of uses, are “under-demolished.”

What is driving Decreased Commercial Building Life Expectancy?

The short answer is technology. The longer answer is human interaction with technology.

Historically, most companies had fairly simple operations and spatial needs, so real estate decisions were driven by location and/or resources, with physical building changes limited by cost and location. The current digital revolution, however, is changing that—literally at the speed of light. Locations are not as “fixed” as they were previously, and businesses’ physical space needs tend to change quickly due to technological shifts. Flexibility will be the key to long-term survival in all industries, including real estate.

Traditionally, real estate has been a fixed asset acquired at high prices compared to most assets. Such requirements mandated long lead times, high fixed costs, significant capital resources, segregation of uses, long-term contracts (i.e., leases and mortgages) and zoning. The industry faces the challenge of adapting fixed physical space needs, and all that goes along with it, to meet the new reality of demand for change at the snap of a finger, and how to underwrite office or other spaces that will likely shift to “creative space” when re-financed (at lower rents, not higher).

Possible Solutions to Decreased Commercial Building Life Expectancy

From a valuation standpoint, there are two traditional factors: zoning/legal issues and physical utility. To maintain real estate flexibility, underwriters, analysts, municipalities and all industries will have to consider:

1. Revised zoning codes that stress density/form over use. The economic lives of buildings are getting shorter and it may be necessary to re-configure space more quickly. This change, however, often runs afoul of local zoning ordinances, minimally, as it relates to uses. If structures in the future are more generic in form, site-specific codes may have to be revised to reflect multiple future uses. By “pre-coding” such code requirements, one of the major impediments to re-development (generically, all permitting costs) can be streamlined for material cost savings and faster re-use. Urban areas already have an advantage in this regard due to greater densities and uses. Suburban areas will need to adapt this concept, or face an even stronger “back to the city” trend than currently in the market. Otherwise, suburban office parks and similar “obsolete concepts” could risk vacancy. All jurisdictions, in order to retain and attract industry—their tax base—will have to re-write zoning laws to allow rapid flexibility.

2. In terms of physical utility, architects and engineers will have to design buildings that can be quickly adapted to alternate uses at a reasonable cost. Aesthetics will still be important. Those who are able to successfully design and build the most flexible buildings first will fare the best. Prime locations will also continue to have great importance. These locations, however, will not be limited strictly to traditional site selection parameters. The key will be how flexible the site and/or building improvements are perceived to be for needed changes due to technological shifts that dramatically alter market demand for that space.

The combination of these elements will require a shorter-term view, and investors and municipalities should incorporate some level of alternate use analysis, even from the original construction date. Underwriters would then have the benefit of downside underwriting (to consider future conversion costs)—on a current basis.

For many years, zoning and functional utility have simply been boxes to check during the valuation process. Moving forward, and given the rapid clip of technological change, it is now time to remove it from a box and think about a real exit strategy beyond the end of a lease or mortgage term.

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