The newly constructed property is net leased to TNT Logistics North America Inc. through 2013. The lease is unconditionally guaranteed by the company's parent, TNT Logistics Holdings BV.
Lexington VP Brendan Mullinex says the company has a preexisting relationship with TNT. He adds that the acquisition was "particularly attractive as a result of the price per square foot, long-term lease with a strong tenant and the favorable financing we arranged."
This is the third acquisition for Lexington in February. It also paid $16.4 million for a new 77,484-sf call center in Redmond, OR that is net leased through 2018 to a subsidiary of T-Mobile USA, and $47 million for a new 198,000-sf building in Santa Monica, CA net leased to Specialty Laboratories Inc.
In 2003, Lexington acquired more than $400 million worth of net-leased office, industrial and retail real estate. In a recent interview with GlobeSt.com for 'Up Close,' Lexington CEO Will Elgin says the firm is set up to match that number in 2004; however, it won't include retail properties.
Currently, about 10% of the company's 23-million-sf portfolio consists of retail space. Elgin tells GlobeSt.com that one of the company's objectives is to become a pure office and industrial company over the course of the next several years. "There's a right time and wrong time to sell each property, and we're committed to getting the right value for our retail holdings as we sell out of them and redeploy that capital," Elgin revealed in the 'Up Close' interview.
As for the decreasing flow of capital to the net lease market, Elgin says that is a good thing for a long-term player in the market like Lexington. "A lot of the capital that has come into the sector in the past few years has been seeking to invest in what's arguably the safest end of the market, and some of that money is going to go away as the economy picks up steam," he tells GlobeSt.com. "It will allow us to do more acquisition volume. The less capital chasing transactions, the better from our standpoint."
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