Class B Industrials Growing in Popularity

315 W. Edgerton Ave., a 63K facility at Milwaukee’s main airport.

MILWAUKEE—Industrial properties are at the top of many investors’ wish lists, but that also means the competition for core buildings has gotten intense, and some buyers have begun checking out secondary markets. Avison Young, for example, has just negotiated the sale of a five-building, 191,000-square-foot industrial portfolio in the Milwaukee General Mitchell Airport industrial market, known as The Gateway to Milwaukee.

“I think this shows that there is a new subset of the industrial sector that is getting a lot of attention,” Avison Young principal Erik Foster tells GlobeSt.com. These infill class B properties, especially those adjacent to airports or other key facilities, are in high demand from users and generate solid yields. The portfolio at Mitchell is typical, with a diverse set of long-term, high-credit tenants with a history of renewals and expansions. Among the national tenants that occupy space within the portfolio are Enterprise Rental Car and Xerox.

Foster and principal Mike Wilson, who lead the firm’s national capital markets team in Chicago, represented the seller, Zilber Property Group. The buyer was a local commercial real estate investment group with other properties in the area. The sales price was not disclosed.