New York City-based Lexington Realty Trust did not return a telephone call to comment on the disposition. The portfolio consists of two industrial buildings in Groveport, OH and Mechanicsburg, PA and one office building in Greenville, SC. All buildings are leased to single tenants, with terms expiring in about four years, says David R. Brown, president and CEO of the Chicago-based ORIX.
"We like the three properties and the credit quality of all three tenants," Brown says. The company has been focusing for six to nine months on net-leased properties with short lease terms because there is not as much competition for the properties, particularly since ORIX is an "all cash" buyer, he explains.
Brown tells GlobeSt.com that there is potential for rental rate increases, but the acquisitions are not regarded as value-add buys. "Overall, our strategy is to focus on single-tenant net leases with four year or less remaining" on the lease term, he says. Eric Wollan and Boris Shraybman, both with ORIX, represented the company in the portfolio acquisition.
[IMGCAP(2)]The Pennsylvania property is a single-story, 507,634-sf industrial building at 6350 Brackbill Blvd. Now leased to Westerville, OH-based Exel Logistics, the warehouse was constructed as a build-to-suit in 1986 on a 29-acre site for Dauphin Distribution. The structure was expanded in 1992 and 1995. According to Lexington's website, Exel's current lease rate is $4.62 per sf, with the lease expiring March 19, 2012. John Huguenard, with Colliers Turley Martin in Indianapolis, represented Lexington in the sale of the Exel-leased building.
The Ohio asset is a 354,676-sf warehouse at 6500 Adelaide Court. It is leased to Weston, FL-based Anda Pharmaceuticals until March 31, 2012 at a rate of $3.65 per sf, according to the seller's website. [IMGCAP(3)]Built in 2002 on a 22.6-acre site, the building is near Rickenbacker Airport and the Norfolk Southern intermodal facility, which is under construction. Lexington acquired the Anda-leased warehouse in 2002 for $11.8 million at the same time it bought a 169,000-sf office building in Fort Mill, SC. Michael Hines in CB Richard Ellis' Wayne, PA office was the seller's broker for the Anda Pharmaceuticals facility.
The Greenville, SC office building, situated on 16.7 acres at 701 Brookfield Pkwy., was a build-to-suit in 2002 for Basking Ridge, NJ-headquartered Verizon Wireless, which uses it for a regional customer service center. Lexington's website has the current lease rate at $10.06 per sf and the lease expiring Jan. 31, 2012. Ryan Clutter in CB Richard Ellis' Charlotte, NC office brokered the sale. Sources say Lexington acquired the building in June 2003 for $21.5 million from Highwoods Properties.
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