Liberty Plans $110M Conversion of GMAC Mortgage Corp. Offices

Liberty Property Trust will develop a 450,000-sf class A office facility for Horsham-based GMAC Mortgage Corp. at 1100 Virginia Dr. in the Fort Washington Business Center. The Fort Washington Expo Center now occupies 290,000 sf in the 850,000-sf building along with two other tenants.

Without disclosing the price of the acquisition, Liberty puts the GMAC project cost at $110 million. The seller is identified as a Northern New Jersey real estate company doing business locally as 1100 Virginia Dr. Associates. The building opened in 1964 as a Honeywell manufacturing facility, and according to published reports, was acquired by the current owner in 1986 for $26 million. Liberty expects to close on the acquisition this June, begin conversion and renovation immediately after that and deliver the GMAC offices in late 2007.

GMAC Mortgage will relocate and consolidate in the new location under a 12-year lease, which, according to Liberty, provides it with space to expand. A GMAC spokesman confirms to GlobeSt.com, “we will not immediately be using all of the space, but will be assuming more over time.” DeVry University leases 103,000 sf, and, according to a Liberty spokeswoman, will remain. The other tenant, she says, is G&A Warehouse, “with a lease that runs until 2009, and it will also remain.” Ralph Gilbertsen, Dan Dagit and Mike Colgan of the area office of CB Richard Ellis represented GMAC Mortgage in the lease transaction.

Paul Decker, president of the Valley Forge Convention & Visitors Bureau, which markets the expo center, tells GlobeSt.com, “we had an inkling of the sale about two months ago, became increasingly concerned and soon began steeling ourselves. A business plan for obtaining new expo space has been put together in hopes the damage will be minimal.” He says potentially 22 consumer or trade show contracts “are seriously endangered and one very big show in late July is in jeopardy. We’re working 24/7 to accommodate them, and, hopefully, we’ll be up and running elsewhere in Montgomery County by fall.”

The loss of the center’s business “would be devastating to the county and its 19,300 hospitality employees.” The bureau represents more than 500 hospitality companies, he says, and the expo center hosts more than 100 consumer and trade shows a year. In a Liberty statement, Bob Pesavento, president of Upper Dublin Township board of commissioners, says, “The township recognizes that the closing of the expo center is a disappointment to many people. However, the reinvestment in this property…and the approximately 2,500 jobs are welcome.”

GMAC Mortgage currently employs 2,500, the major proportion of whom are now located in 350,000 sf of space in Liberty’s Pennsylvania Business Campus. It will consolidate all Horsham locations in the new facility, according to Dave Applegate, CEO. In 1995 Liberty acquired and demolished a vacant manufacturing plant for GMAC Mortgage’s current office at 100 Witmer Rd. Liberty, which is based in Malvern, owns five buildings in Fort Washington. Its development and redevelopment of Fort Washington Business Park includes the demolition of a vacant Amtrak call center for offices for URS Corp. and a new office property for McNeil Pharmaceutical.

What are people saying about mortgages today:

Rates on 30-year mortgages edged down last week to a seven-month low. Mortgage-giant Freddie Mac reported Thursday that 30-year, fixed-rate mortgages fell to 6.3 percent, down slightly from 6.31 percent two weeks ago. It put rates at the lowest level since they were at 6.24 percent the first week of March.

Bank of Hawaii, Central Pacific Bank, Territorial Savings Bank and Wells Fargo Home Mortgages all cut their 30-year mortgage rates to 5.75 percent this week.

Most people think of a mortgage as a means to an end. After all, you buy a house, not a home loan. But a mortgage is much more than the path to homeownership. It is a financial instrument that must be managed, just like any other financial investment.