The deal includes three industrial buildings, totaling 171,497 sf, at the Dallas-Ft. Worth International Airport, which are leased to BAX Global, Worldwide Flight Services and Federal Express. The portfolio also includes on-tarmac structures at Baltimore-Washington, Dayton, Jacksonville, Kansas City, Los Angeles, Philadelphia and Seattle-Tacoma. The average ground lease is 24 years.
With this acquisition, AMB now owns or has under development more than 1.9 million sf of on-airport cargo buildings at 10 airports nationwide. The acquisition represents nearly half of AFCO's portfolio. AFCO, which will retain the 5% equity interest, will continue to handle day-to-day property management and leasing.
The DFW three-building complex, like several others in the portfolio, has room for expansion and renovation of existing structures. AMB presently is developing two on-tarmac buildings, totaling 430,000 sf, with ramp access and has completed a three-building, 195,000-sf complex at DFW. The buildings can accommodate simultaneous loading or off-loading operations of up to eight 747 - 400 freighters and 93 trucks.
"We may or may not pursue it, depending upon market conditions, but there is potential for expansion," Michael Coke, AMB's CFO, tells GlobeSt.com. Expansions or renovations also may be in store for Dayton, OH, Kansas City and Philadelphia.
In addition, AMB is building air cargo centers at George Bush Intercontinental Airport in Houston and Portland International Airport. On-tarmac air cargo centers range in size from 50,000 sf to 232,000 sf and cost about twice as much to construct as a concrete tiltwall industrial building on land that is not airport owned.
Frank Chambers, AFCO's president and CEO, says the alliance with AMB will open doors "to explore more on-tarmac opportunities at major airports domestically, and possibly internationally, than we would by our ourselves."
The purchase price includes the assumption of $48.1 million of debt with an average rate of 7.8% and a weighted average maturity of 17 years. It also includes the issuance of $2.35 million in operating partnership units in AMB Property LP, priced at $23.51 per unit.
The privately held AFCO is a full-service real estate development and management organization specializing in airport and other transportation related facilities, such as air terminals, air cargo, air hangar, marine cargo terminals and intermodal transportation facilities. AMB Property Corp., a leading owner and operator of industrial real estate nationwide, own, manages and has renovation and development projects at 946 buildings in 25 metropolitan markets.For the full story, click on: AMB Property Corp. Acquires 20 Air Cargo Buildings at Eight US Airports
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