When SWM International decided to relocate its cigarette paper production to France, it faced a significant challenge: selling its 475,000-square-foot former paper mill on a 65-acre site in New Jersey. The property had environmental issues and asbestos due to its 1940s construction, and the initial appraisal came in at just $12 million.
SWM needed a solution that would maximize the property’s value despite these complications.
That’s when Fennelly Associates stepped in.
The Challenge: Environmental Issues and a Low Appraisal
The 85 Main Street property, with its environmental concerns, had been under remediation for over 20 years. Additionally, the presence of asbestos from its mid-century construction created further hurdles. SWM needed a partner who could unlock the potential of the site and secure the highest possible value.
Fennelly’s Approach: Strategic Marketing and Targeted Buyers
Fennelly Associates listed the property at $14 million, slightly above the appraisal, and got to work immediately. Within just 30 days, the team showed the property 100 times, attracting frequent offers. Their strategic approach identified two key potential buyers: occupiers who could use the facility for operations or developers looking to repurpose the site for warehouses.
Through a competitive bidding process, Fennelly’s team pushed the value to $40 million–more than three times the original appraisal. The final buyer, Rockefeller Development, sought approval for redevelopment, but the deal was structured in a way that wasn’t contingent on these approvals, allowing for a swift and smooth closing.
The Result: A Profitable Outcome in a Short Timeframe
In just nine months, the transaction closed at $40 million, providing SWM International with a significant profit. The deal was finalized within the same fiscal year, enabling the company to book the profit from a plant closure and environmental cleanup–turning a challenging situation into a lucrative outcome.
Fennelly Associates specializes in solving complex real estate challenges. From navigating environmental issues to securing the right buyer, our expertise in the New Jersey commercial real estate market allows us to maximize value for our clients, even in difficult circumstances.
The sale of 85 Main Street demonstrates Fennelly Associates’ ability to turn challenging properties into profitable transactions. If your company is facing a difficult real estate situation, partnering with Fennelly Associates can lead to strategic solutions that unlock value and ensure success.
Contact us here to see how we can help you achieve outstanding results.
