(To read more on the industrial market, click here.)
TORONTO-Summit REIT is acquiring six light industrial properties for $28.9 million. Five of the properties each hold a single industrial building for a combined lettable area of 466,238 sf. The sixth property is a 14.3-acre parcel that can hold 215,000 sf of industrial development.
Of the five buildings being acquired, the largest is the South Rail Distribution Facility in Edmonton's Southeast Industrial Park. The property is a 249,151-sf multi-tenant industrial distribution building situated on 13.6 acres. The property can accommodate an additional 37,500 sf of future development. The $14.6-million price tag translates to a stabilized capitalization rate of approximately 7.7%.
In northwest Edmonton, Summit is acquiring a 53,460-sf light industrial property located at 14440 124th Ave. This property was purchased for approximately $2.85 million, which Summit says translates to a 9.8% capitalization rate.
The three other buildings acquired are located in Quebec. The acquisitions include 2101 rue Nobel, a 71,704-sf building in Ste. Julie; 1355 32nd Ave., a 50,000-sf industrial building in Lachine; and 2515 boulevard De La Renaissance, a 42,000-sf building adjacent to an existing Summit property in Boisbriand. The average cap rate for the acquisitions is in the 9% range, according to Summit.
The land parcel is located within the Burnside Industrial Park in Dartmouth, Nova Scotia. The purchase price is $3.24 million. Summit will be constructing a 35,500-sf single-story building on the property for a major insurance company; the site can accommodate another 180,000 sf of development.
Summit REIT chief executive Lou Maroun says these latest acquisitions mean the company has met its goal of acquiring between $80 million to $100 million in new properties in 2005. So far this year, the company has added about 1.5 million sf for $96.8 million, "and we expect to add to this total by year-end," says Maroun.
Summit also said Thursday that conditions have been waived with regard to its sale of Broadway Centre in Jacksonville, FL, pursuant to its strategy to exit the US real estate market. The facility, a 141,249-sf building, will be sold for approximately US $8.3 million. The transaction will close before the end of the month.
Summit REIT owns a portfolio of high-quality properties containing approximately 32 million sf of lettable space. The REIT is focused primarily on the light industrial segment of the Canadian real estate market.
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