AstraZeneca sells Rollins building; U.S. 202 landmark to be Applied Bank Center - News Journal
AstraZeneca sells Rollins building; U.S. 202 landmark to be Applied Bank Center
By Wade Malcolm and Cori Anne Natoli The News Journal 9/7/13
A local bank considering a plan to bring jobs to Delaware could give new life to a landmark office building in suburban Wilmington that has stood vacant for months.
Drugmaker AstraZenca sold the 40 year-old Rollins Building, the recognizable 15-story tower along Concord Pike, to an investment firm controlled by Rocco Abessinio, founder of Newark-based Applied Bank.
In a deal worth about $10.5 million, Abessinio’s Roch Management Inc. took control of the 209,000 square-foot property Aug. 30 and will rename it “Applied Bank Center.” The company is weighing the idea of moving jobs from a facility with about 300 workers in Pennsylvania to Delaware. It also could find other tenants to fill the space.
AstraZeneca, which has its U.S. headquarters in Fairfax, no longer needed the building after recent job cuts. The pharma giant also announced plans in 2011 to raze three structures on the north campus containing 450,000 square feet of lab space, built in 1958, on Concord Pike.
Applied Bank started in 1996 as a homegrown Delaware credit card bank that offered credit to risky, sub-prime borrowers, benefiting from Delaware’s banking laws allowing high interest rates and fees and a favorable tax structure.
The bank continues to describe itself as a leader in providing services “to people with little or no credit history.” Recently, the bank has offered more retail and business banking products and has been named a top Small Business Administration lender over the past few years.
The bank, which has about $179 million in assets, previously had a large part of its opera-tions at 800 Delaware Ave. in Wilmington but left the city during the last decade after building a new office campus near Chadds Ford, Pa. Applied still maintained several Delaware branches, along with its headquarters in Glasgow, and kept its Delaware charter.
The Pennsylvania office space is currently listed as available for lease to a new tenant, said Jim Dougherty, senior executive vice president at RAA Management, an affiliate company of the bank.
“It’s under consideration, but nothing has been decided yet,” Dougherty said of the possibility of moving the jobs to Delaware. “We’re trying to lease the building, and if we lease all of it out, that’s great.”
A deed filed after the sale, which closed Aug. 30, said an entity called J’s MVP 2200 Concord Pike, an LLC registered to Applied Bank, bought the property for $1, but the $157,500 in real estate transfer tax paid on the purchase indicates it sold for $10.5 million.
AstraZeneca bought the Rollins Building for about $37.9 million in 2004 from The Buccini/Pollin Group, according to records at the New Castle County Recorder of Deeds office. The building has a full-service cafeteria and stadium-seating conference facilities.
The relocation of jobs would be a positive development for the state’s financial services sector, a major source of employment in Delaware and an important tenant for local office space.
“It think there were a lot of disappointed people when they moved out of 800 Delaware,” said Pete Davisson, a commercial real estate broker with Jackson Cross Partners who has worked with Applied Bank but was not involved in the Rollins Building transaction. “It would be exciting to have them back in Delaware.”
Dougherty said he believes the new Applied Bank Center would be appealing to a variety of different tenants, and commercial brokers Blaise Fletcher and Jamie Vari of the firm Jones Lang La-Salle will market the space.
For AstraZeneca, the sale is another step in a global restructuring plan. The three buildings it plans to tear down are much older than the rest of the corporate campus. The complex was built following the merger of Astra and Zeneca in 1998 and its 1999 decision to consolidate U.S. headquarters in Delaware, aided by $130 million in state incentives. State officials say AstraZeneca has advised them the buildings would need considerable renovation and upgrading of mechanical systems that could cost millions.
The R&D buildings are currently in a closed state, said Michele Meixell, AstraZeneca director of corporate communications.
“Our intention to demolish those buildings remains, however, no demolition has started, and we will revisit the timing decision in 2014,” Meixell said, noting there are no new job losses associated with the sale of the Rollins building. “As we announced in March, Wilmingtonbased research and development, global marketing and specialty-care com-mercial functions will now be based in Gaithersburg, Md.,” Meixell said. “The North America commercial business, along with several corporatebased support functions, will remain based in Wilmington.”
Work force cuts have been unavoidable as the company slims down and refocuses in the face of a string of patent expirations on key medications as less expensive generic copies enter the market.
Some 2,300 workers worldwide will be laid off by 2016, lifting the number of staff cuts to 5,050. That includes reductions at its offices for the Americas in Fairfax, where it learned in March it would lose 1,200 positions, about half through transfers. The work force reduction will occur as part of a consolidation of research and development into three global centers: at MedImmune in Gaithersburg, Md., in Sweden and as part of a $500 million investment in a new facility in England.
Chief Executive Officer Pascal Soriot, who took the helm nearly a year ago, has stepped up the biopharmaceutical firm’s efforts in biologics – medicines made from living organisms – and is targeting treatments for cancer, cardiovascular ills, the immune system and diabetes – ailments that represent a large unmet need.
The firm’s $15 billion purchase of MedImmune, the maker of FluMist, came under criticism by analysts who then said the firm overpaid. Since the acquisition, MedImmune has come to represent nearly 50 percent of AstraZeneca’s overall research and development pipeline and is bearing fruit in biologics.
The unit has more than 120 biologics under development and 30 projects in clinical stage development.
Contact Wade Malcolm at 324-2386, on Twitter @WadeMalcolm or firstname.lastname@example.org. Contact Cori Anne Natoli at 324-2855, on Twitter @CoriAnneNatoli, Facebook Cori Natoli-News Journal or email cnatoli@delawareonline. com.
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