(Read more on the industrial market.)
ROSWELL, GA-BPG Properties, based in Philadelphia, closed today on the purchase of a 20-building industrial portfolio. The sales price was $93.5 million. Local market participants estimated the cap rate at about 7%. The buildings have a total of 1.22 million sf and are located in Roswell and Alpharetta. Senior director Jim Carpenter and Ken Szady, both with Cushman & Wakefield, represented the seller.
The seller's identity was not disclosed but, Carpenter says the seller is a $1-billion-plus joint venture that bought a large industrial portfolio and is selling it off in pieces. The joint venture sold a 1.15-million-sf portfolio in Nashville last month for $87.2 million, as GlobeSt.com reported last month. Cushman & Wakefield also represented the seller in the Nashville sale.
Carpenter compared the joint venture's sales to Blackstone buying Equity Office Properties Trust and selling it off, except this is on a smaller scale and industrial properties. "They bought a big portfolio and they are selling it off in pieces on the premise that the pieces will be worth more than the whole," he says. Between half and two-thirds of the portfolio has now been sold.
The buildings in the 1.22-million-sf portfolio are 85% occupied. Major tenants include Kimberly Clark, Bell South, Johnson Controls and UPS. Local market participants estimated the average lease rate at about $10 per sf, gross. Most of the buildings were constructed around 1995 and renovations are not expected to be needed. The 20-building portfolio was attractive to BPG because "There are some barriers to new products in the area and most of the surrounding land uses are retail, high-end residential and multi-story suburban office," Carpenter says.
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