Finmarc Eyes Philly-NJ as Growth Market Outside DC

BETHESDA, MD—Commercial real estate firm Finmarc Management is looking to expand its sizable portfolio outside of the District and has identified the Philadelphia-Southern New Jersey market as a prime area for growth.

The Bethesda, MD-based company reports it has secured a long-term lease for 150,000 square feet with Clinical Health Care Associates of New Jersey, PC, a subsidiary of the University of Pennsylvania and Clinical Practices of the University of Pennsylvania, for 150,000 square feet of medical office space at 1865 Marlton Pike in Cherry Hill, NJ. The property was acquired by Finmarc in September 2013 and was formerly occupied by Syms Corp.

Finmarc is among a number of significant players in the DC commercial real estate market that have been looking outside the Beltway for new opportunities. For example, Federal Capital Partners has been investing up and down the Eastern Seaboard for the last few years. Just to name one recent example, it recently provided $4.75 million in mezzanine financing for an apartment community in Raleigh, NC. Since its entrance into the Research Triangle area, FCP has made debt and equity investments in more than 16 properties valued at close to $400 million.

Another example is JBG Rosenfeld Retail of Chevy Chase, Md., which has also spread its investment dollars in nearby states, including Pennslyvania.

Over the last 24 months, Finmarc, along with its partners, has acquired or disposed of nearly $400 million worth of properties. The firm presently manages a portfolio encompassing more than 5 million square of commercial space in Maryland, Virginia, Delaware, New Jersey and Pennsylvania.

“The Cherry Hill and South New Jersey/Philadelphia marketplaces are extremely attractive to us, as we recognize the tremendous opportunities that exist, as supported by a healthy and growing economic environment. It is among the key areas we have targeted to expand our 5-million-square-foot portfolio outside of the greater Washington, DC metropolitan area,” says Neil S. Markus, principal of Finmarc Management.

Finmarc and Clinical Health Care Associates plan to spend $50 million on capital improvements to the building, which will include the installation of a new roof; heating, air-conditioning and electrical systems; tenant build-out to support the full-building use; necessary site work; a new structured garage and repaving of the existing free-standing parking lot. In addition, the exterior facade will be renovated, windows will be added throughout the building and all exterior and interior lighting will be upgraded, the company states.

“Our enhancement strategy was designed to re-position the former Syms building as one of the premier medical office facilities in the Cherry Hill and south New Jersey area in order to re-energize the asset into a functional new use and dramatically increase the property's long-term value,” Markus says.