CHICAGO—The Chicago industrial market has been setting records for leasing activity and positive absorption for several years now, and that puts it at or near the top of places where investors feel it's safe to buy. And that includes not just its new, class A properties, but the class B ones as well.
That was shown recently when Boston-based Plymouth Industrial REIT, Inc. closed a $99.75 million acquisition of a 15-building, class B industrial portfolio in the Chicago area with a total of about three million square feet. The sale comes almost three years after Goldman Sachs, along with Brennan Investment Group, acquired the facilities, mostly spread out between Southeast WI, Lake, DuPage counties, as a part of 23-property, $170 million portfolio deal. Other buildings in that portfolio were snapped up by other buyers in 2015.
The purchase price on the sale to Plymouth includes $19.95 million in cash and a $79.8 million, two-year secured term loan at an initial interest rate of 4.35% from an affiliate of the seller. The acquisition is projected to provide an initial yield of 8.1%
“This transaction significantly expands our presence in the greater Chicago market,” said Jeff Witherell, chairman and chief executive officer of Plymouth, “We now own over 3.5 million square feet there, averaging about 95% occupancy across 21 properties. We feel very positive about the market and our ability to maintain strong tenancies and grow rental revenue over the next few years.”
Plymouth's new portfolio consists of ten single-tenant buildings totaling approximately two million square feet and five multi-tenant buildings totaling approximately one million square feet. A diverse mix of manufacturing and distribution tenants, all with strong credit, long histories in their locations and heavy capital investment in their space, lease a total of 96% of the portfolio.
As reported in GlobeSt.com, Brennan has become one of the most active buyers in the region, and focuses much of its attention on class B, value-add opportunities it can then stabilize and sell.
A team from DLA Piper represented Goldman Sachs in the transaction, and included Chicago-based partner Andrew Weil, attorney Julie Ehrlich, associates Abby Flanagan and Aaron O'Donnell, as well as Washington, DC-based partner Jeffrey Hare.
CHICAGO—The Chicago industrial market has been setting records for leasing activity and positive absorption for several years now, and that puts it at or near the top of places where investors feel it's safe to buy. And that includes not just its new, class A properties, but the class B ones as well.
That was shown recently when Boston-based Plymouth Industrial REIT, Inc. closed a $99.75 million acquisition of a 15-building, class B industrial portfolio in the Chicago area with a total of about three million square feet. The sale comes almost three years after
The purchase price on the sale to Plymouth includes $19.95 million in cash and a $79.8 million, two-year secured term loan at an initial interest rate of 4.35% from an affiliate of the seller. The acquisition is projected to provide an initial yield of 8.1%
“This transaction significantly expands our presence in the greater Chicago market,” said Jeff Witherell, chairman and chief executive officer of Plymouth, “We now own over 3.5 million square feet there, averaging about 95% occupancy across 21 properties. We feel very positive about the market and our ability to maintain strong tenancies and grow rental revenue over the next few years.”
Plymouth's new portfolio consists of ten single-tenant buildings totaling approximately two million square feet and five multi-tenant buildings totaling approximately one million square feet. A diverse mix of manufacturing and distribution tenants, all with strong credit, long histories in their locations and heavy capital investment in their space, lease a total of 96% of the portfolio.
As reported in GlobeSt.com, Brennan has become one of the most active buyers in the region, and focuses much of its attention on class B, value-add opportunities it can then stabilize and sell.
A team from
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Brian J. Rogal
Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.
