The 25 buildings, situated on 68 acres, have been sold by Principal Capital Management, an investment pension fund based in Hong Kong with its US office in Des Moines, IA.
"The Valwood sale is an especially important transaction, given its size and diversity of property type," says Jack Fraker, executive vice president for Cushman & Wakefield of Texas Inc."It is one of the largest portfolios ever offered in the Greater Dallas Area." Fraker, Randy Baird and Angelina Wright have brokered the sale on behalf of Principal Capital Management. First Industrial has used in-house brokers Dan Stoffle and Greg Heck to close on the class-A package in the high-profile park positioned at the intersection of Interstates 35E and 635.
First Industrial had pushed past 10 other offers "in a very competitive pricing" to get to the closing table, Baird, senior director, told GlobeSt.com. The deal has taken about five months to close and its apparent big-ticket price is being kept under wraps.
The premier industrial sale might be setting the tone for what is to come in the months ahead. Baird says market indicators show that "there's a huge appetite from the buyer's side for class-A industrial properties." The market is such that a selling phase could be triggered in the second or third quarter. But for now, says Baird, "we've noticed a real tendency by industrial owners to hold onto their class-A properties."
Principal Capital still owns 10 million sf in the metroplex and more than 1.5 million sf in Valwood, where it is developing more industrial buildings, says Baird. In the past year, Principal Capital has been shifting its portfolio "trying to optimize their geographical mix of properties through a combination of acquisitions and dispositions," he assesses. Just last year, Principal Capital had acquired 1.4 million sf, the bulk of which is positioned in the Great Southwest Industrial Park.
The 25-building Valwood portfolio, developed between 1980 and 1990, includes structures ranging from 16,8000 sf to 107,915 sf. The grouping has a wide-ranging occupancy level, with one as low as 30% to 12 that had been fully leased at sale time. Tenants are paying an average of $5.75 per sf net for the space. The buy also includes two non-contiguous parcels totaling about 4.6 acres abutting some of the portfolio's developed sites.
First Industrial owns 1,169 properties, totaling 74 million sf, in 32 markets. Prior to this acquisition, the Dallas holdings had contained 103 properties encompassing about 5.3 million sf, giving the city a fourth-place ranking in the overall portfolio.
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