DUNMORE, PA-An affiliate of Conshohocken-based Equilibrium Equities Inc., paid $7.1 million, or just shy of $16 per sf, for Key Market Distribution Center. The seller is a local partnership, which constructed the two-building, 446,000-sf property in phases over the past 30 years.

It is located on 21.1 acres in Keystone Industrial Park. In a statement, John Morris, VP of Equilibrium, says the acquisition "provides us with an expanded platform in the growing Northeastern Pennsylvania industrial market," and also says the property "complements a 151,000-sf warehouse we acquired in this market in 2003." Calls to Equilibrium were not returned by deadline. It plans capital improvements such as painting, landscaping, new signage and repaving of the truck courts.

A current tenant will vacate 324,000 sf of space in the buildings in January 2006, and Equilibrium will offer spaces that range from 41,000 sf to the full 324,000 sf at an undisclosed rate. Warehouse space in the Northeast area of the state now commands between $3.85 per sf and $4.50 per sf, according to a report from the Philadelphia office of Colliers Lanard & Axilbund. On condition of anonymity, a broker familiar with rates in Keystone Park tells GlobeSt.com that rates for this property "will probably be considerably below the average, which includes a lot of new construction in the Wilkes-Barre/Scranton area." He suggests a single tenant would obtain a rate "in the low $3s per sf" in this complex.

Locally based Community Banks Inc. provided a loan of an undisclosed amount to fund this acquisition. Equilibrium, which also has an office in Wilkes-Barre, will manage the property and handle leasing.