Raith Capital Pockets $140M on Sale of 3 MSF Portfolio
- Feb 02, 2021
Raith Capital Partners has walked away with $140 million on the disposition of a collection of 12 industrial properties spanning roughly 3 million square feet in the Midwest. With the assistance of JLL Capital Markets, the private investment firm sold the nearly fully leased assets to three different buyers in separate transactions after having successfully executed a years-long asset management strategy at each facility.
The industrial portfolio consists of buildings located in metropolitan Cleveland, as well as facilities in Fort Wayne and Bloomington, Ind.—all of which are markets that have not always been at the top of industrial investors’ list. However, JLL Capital markets solicited a deep and diverse buyer pool that responded in kind, resulting in a broad and competitive process that even yielded some parties that were new to the sector and/or the market. The Midwest’s rather newfound popularity among industrial investors is no fluke.
“I would say that the industrial sector nationally is well positioned, and the Midwest is certainly included in that,” Sean Devaney, managing director with JLL Capital Markets, told Commercial Property Executive. “The fundamentals on the user front remain healthy across virtually all Midwest markets. As for the capital side, the Midwest offers an opportunity to get a little yield premium compared to coasts which for some investors is critical.” JLL Capital Markets’ John Huguenard, Kurt Sarbaugh Peter Moriarty, Joe Messina and David Stecker joined Devaney in the representation of Raith.
Raith sold the bulk of its portfolio, a 2.1 million-square-foot group of properties in the Cleveland area, to Plymouth Industrial REIT for $94 million. The 10 multi- and single-tenant Ohio buildings are approximately 90 percent leased to 15 tenants and include: 3400, 3111, 3081, 3325, 3375 and 3425 Gilchrist Road. in Mogadore; 4122 Shuffel St. N.W., and 2100 and 2210 International Parkway in Canton; and 1366 Commerce Dr. in Stow. The approximately 274,500-square-foot building at 2100 International is one of the more recent properties that Raith had added to its holdings, having acquired the fully leased, build-to-suit facility in 2018 for roughly $14.1 million.
The remaining two Indiana assets, the 764,200-square-foot bulk distribution center at 2902 Pleasant Center Road in Fort Wayne and the 125,000-square-foot manufacturing and distribution center at 555 N. Daniels Way in Bloomington, came under the ownership of STAG Industrial Inc. and Legacy Investing LLC, respectively. Located on more than 114 acres, 2909 Pleasant is a single-tenant facility that is fully occupied by a vehicle parts supplier, and the 19-acre 555 N. Daniels property, featuring freezer and cooler space, is triple net leased to a global health-care and pharmaceutical company.
As Devaney noted in a prepared statement, the JLL and Raith teams collectively thought it best to pursue multiple transactions to efficiently transact on the overall portfolio, given the variety of individual deal profiles.