NOVEMBER, 2008

NOVEMBER, 2008—PernaFrederick Commercial Real Estate Represents Philadelphia Regional Produce Market in Negotiation of 40-Year Lease for Development of $218.5 Million Food Distribution Center

PHILADELPHIA, PA — PernaFrederick Commercial Real Estate has represented the Philadelphia Regional Produce Market in the negotiation of a long-term, built-to-suit lease agreement that will move the Market to a state of the art building to be developed on 48.6-acres at 6700 Essington Avenue here.

Steve Perna, a principal of PernaFrederick, was the sole agent who identified the building site and brokered the terms of the lease with the O’Neill Properties Group and the Philadelphia Regional Port Authority that will own the facility.

According to Perna, Essington Avenue Partners, a development affiliate of O’Neill Properties, will build the new facility at an estimated project cost of $218.5-million. In addition to the primary 48.6-acre site, the project will include another 15-acre parcel previously owned by the Philadelphia Industrial Development Corporation (PIDC) that will be used as a parking/staging area.

The Philadelphia Regional Port Authority (PRPA), will receive $152.5 million of the total project costs from the Commonwealth of Pennsylvania. Under the complex transaction, PRPA is acquiring the 63 acres and funding construction of the 667,000 square foot distribution facility.

AIG Insurance is also participating in funding the project with a $50 million mortgage, Perna said.

PernaFrederick Locates Site for Regional Produce Market

The Authority will enter a 40-year lease with the Regional Produce Market under which vendors will repay 100 percent of the grants and loans involved over the lease term. The vendors then have an option to acquire the land and building at the end of that space contract.

“Everyone was working to get the Produce Market into new quarters at a site in the City which satisfied the merchant’s unique operating needs. That required patience, innovative thinking from Brian O’Neill, president of O’Neill Properties, and the collaboration of both City as well as State political leaders and the President of the Market, Sonny DiCrecchio. We were pleased to be a member of the team that ended the long search with a built-to-suit, state of the art building that will make the Regional Produce Market the most modern facility of its type in the world,” Perna said.

PernaFrederick is headquartered at Two Penn Center and specializes in commercial brokerage to include landlord and tenant representation, user and investment sales, as well as consulting.

The firm serves as exclusive leasing agent for Two Penn Center Plaza, the North American Building, 400 Market Street and The Granary in Philadelphia.