Industrial Logistics Properties Trust Sells Six Assets to Its JV
ILPT to receive total net proceeds of approximately $190 million.
Demand and value in industrial properties continue to trend at positive—if not, unprecedented—levels, giving reason for investment and management of this segment to flourish.
The latest example: Industrial Logistics Properties Trust is adding six industrial properties to its existing joint venture with institutional investors for an aggregate price of approximately $206 million.
The properties are 100% leased for a weighted average remaining lease term (by annualized rental income) of 4 years and total 2.5 million square feet. They are located in Goodyear, Ariz., Memphis, Tenn.; Southaven, Miss.; and Columbus, Ohio.
With these assets, the joint venture now totals 11.7 million square feet across 18 properties in 12 states.
ILPT continues to own a 22% equity interest in the joint venture and the joint venture plans to incur approximately $134 million of debt secured by the properties in early 2022, which will result in total net proceeds to ILPT of approximately $190 million.
ILPT plans to use the net proceeds from the sale and subsequent debt financing to reduce outstanding borrowings under its $750 million unsecured revolving credit facility.
‘Intense Demand’ for Industrial Properties
According to a recent report from JLL, the industrial market hit a new record-low vacancy rate of 4.3% in Q3 2021 as net absorption hit a record high of 135.1 million. Consequently, rents rose too, 7.1% year over year.
See Ten Industrial Markets Where Rents are Surging.
Of the 85 million square feet of new industrial space delivered in the third quarter, 69.6% was preleased, according to JLL.
The joint venture is managed by The RMR Group, which also manages ILPT. RMR provides property management services nationwide for nearly 1,300 properties with approximately 91 million square feet of office, industrial, medical office, life science and retail space.