The recent acquisition allowed ProAmpac to assign its purchase option to EverWest.
AUBURN, WA—Within the supply-constrained Auburn market, just south of metro Seattle, the current industrial market vacancy rate sits at just 2%, with a limited development pipeline. This compares to a 3.1% industrial vacancy rate in metro Seattle and a 5% industrial vacancy rate in the greater US, according to EverWest Real Estate Investors.
This low vacancy, coupled with historically low availability, resulted in the purchase of a three-building industrial portfolio. With this purchase, EverWest Real Estate Investors, in partnership with a Colorado-based investment fund, has increased its presence in the Pacific Northwest to almost one-half million square feet of industrial space.
The acquisition allowed the current tenant, $1.1 billion global packaging company ProAmpac, to assign its purchase option to EverWest in exchange for a 15-year long-term sale-leaseback agreement. The lease allows ProAmpac to maintain 100% occupancy at the project, where it has occupied all three buildings since the construction between 1981 and 2003. The campus serves as ProAmpac's main production and distribution location on the West Coast.
“In purchasing this campus, we're walking into a very attractive investment opportunity alongside an extremely stable tenant, in an area where extremely tight vacancies and very strong long-term market fundamentals make this one of the most desirable industrial real estate investment locations in the Northwest,” said EverWest managing director Ryan Madson, who oversees the company's Northern California and Pacific Northwest acquisition activity. “It's a scenario that benefits all parties.”
The buildings total 109,941 square feet, 97,081 square feet and 79,450 square feet respectively, broken out as approximately 262,300 square feet of traditional warehouse space with loading docks and approximately 24,200 square feet of office space. The 701 buildings also provide mezzanine space.
“ProAmpac has a long history in these buildings and in this submarket, and one of the more gratifying outcomes of this transaction is that it allows the tenant to remain in place,” Madson tells GlobeSt.com.
“That is a great advantage in a submarket where vacancy rates sit even lower than the US or metro Seattle, and opportunities for multi-building campuses are in historically short supply.”
Located at 701 A St. NW, 701 A St. NE and 713 A St. NE, the ProAmpac campus totals three buildings and 286,472 square feet in the Kent Valley submarket, one of Washington's most in-demand warehouse and manufacturing locations. The properties are minutes from Interstate 5 and Highways 167 and 18, and only 11 miles from Interstate 405, 13 miles from the Port of Tacoma and 29 miles from the Port of Seattle.
Madson directed the ProAmpac property acquisition on behalf of EverWest. Tony Kusak, Jack Keenan, Mike Sessa and Jason West of Cushman & Wakefield represented the tenant, ProAmpac, and led the sale-leaseback disposition process. Taylor Hoff with NAI Puget Sound Properties represented the previous landlord, Gates, Gates, Gates LLC.
EverWest owns two additional industrial buildings in the Kent Valley submarket: the three-building 138,296-square-foot West Valley Distribution Center portfolio (acquired in late 2017), and new 42,982-square-foot industrial building (completed in late 2017) at 7011 S. 182nd St. The company continues to seek new industrial investment opportunities in the market.
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Lisa Brown
Lisa Brown is an editor for the south and west regions of GlobeSt.com. She has 25-plus years of real estate experience, with a regional PR role at Grubb & Ellis and a national communications position at MMI. Brown also spent 10 years as executive director at NAIOP San Francisco Bay Area chapter, where she led the organization to achieving its first national award honors and recognition on Capitol Hill. She has written extensively on commercial real estate topics and edited numerous pieces on the subject.
