In the larger sale, Itel Trust of Portland bought a 20,000-sf building fromChicago-based First Industrial Realty Trust Inc. for $1.9 million. Thebuilding at 14626 NE Airport Way, Portland, is fully leased to SoundElevator. Itel Trust bought it as a leased investment, according to TrishaRaicht, client services manager with the Portland office of Grubb & Ellis.
In the second transaction, Tristate Construction Inc. bought a 17,000-sfbuilding at 5730 NE 138, Portland, from Anchorage-based Cook Inlet RegionInc. in a deal valued at $1.64 million.
Tristate, a locally basedconstruction company, is the sole user. Cook Inlet unloaded the propertyfollowing the folding of its used-equipment business, Construction MachineryInc., last year.
"These transactions are a really good indication of what's popular: net-lease investments and industrial-user properties priced at between $1million and $10 million," Raicht says. "Portland's industrial market reallyholds its value, particularly in this size range."
Both Raicht and David Hill, the Grubb & Ellis VP of investments whorepped both sides in each transaction, say investors made "multiple offers"on both properties.
The $100-psf price "is very high for industrial" in the market and showsthat the right product will spur investor interest because they are lowmaintenance and relatively low-risk, Hill says.
"They're the two highest in-demand products by tenants," he says. "You cansell these all day long."Such smallish transactions are keeping the fire lit in an overall industrialmarket smothered by fallout from the ailing tech and telecom sectors.Industrial vacancy has topped out at 10% as the market begins the slow roadto recovery, Raicht says in Grubb's recently released fourth-quarter report.The quarter finished strong, with 514,000 sf of net absorption cutting theyear's net absorption to a negative 157,000 sf.Manufacturing, warehouse and distribution space accounted for all thepositive net absorption in 2002, while 1 million of empty R&D and flex spaceplunged absorption figures into the red.
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