Hayden says the trade was a good one based on the fundamentalsalone. As an added bonus, though, this transaction gives HaydenReal Estate a foot in the door to assist Ollie's as its doubles itsdistribution square footage. "We want to be their landlord for nextdeal too," Hayden says.
The three warehouses are located along Route 22 in the rapidlygrowing I-81/I-83 Corridor. That is one reason why the companylikes the Harrisburg market in general, Hayden says--its access andproximity to the major markets along the Eastern Seaboard. TheI-81/I-83 Corridor is used to serve the mid-Atlantic Region fromNew York to Richmond to North Carolina, he says.
Right now Harrisburg is proving difficult to acquire newindustrial product, he says. "So when we found this deal we werevery excited about it, even without the Ollie's connection."Ollie's is paying below market rents for the rest of its term. "Wewill be able to reposition the buildings when the lease rolls overand do very well," he says. Asking rate for the facility are themarket $4 per sf, triple net. The portfolio traded at a 9% caprate, Hayden adds.
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