Keystone is contributing a $90-million portfolio, which consists of eight industrial properties totaling approximately 2 million sf. The properties are located primarily in Indianapolis, but also include facilities in Allentown, PA, and one in Central NJ. The joint venture will have the capacity to acquire an additional approximately $120 million in properties.
Keystone will retain a 20% equity interest in the JV and the BIT will contribute the remaining 80% of the equity. The partnership will have a leverage target of 40%.
This is Keystone's second such partnership with a major institutional partner. It has a $300-million partnership, CalEAST Industrial Investors LLC, comprised of Chicago-based LaSalle Investment Management and Sacramento, CA-based California Public Employees' Retirement System (CalPERS).
"I believe that the joint venture model is a good one for industrial REITs," says Jeffrey E. Kelter, Keystone's president and CEO, "and this venture represents a natural step in our evolution as focused owner/operator of industrial properties. Our ability to source one-off transactions is a valuable commodity and a natural fit for institutions that are not well equipped to source one-off industrial property transactions, which tend to be smaller investments," he adds.
The Keystone/BIT venture will shop for stabilized properties, primarily in Indianapolis and other markets within Keystone's existing geographic footprint. Finalization of the venture is subject to definitive documentation and is expected to be completed before the end of this month.
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