"We thought it was very well priced and we thought we couldmanage it better than the previous owner," Tom Burton, ABR's CIO,tells GlobeSt.com. "We've been buying industrial assets around theMidwest. It's an attractive product type, so you don't see itpriced like this very often."

|

ABR Chesapeake Fund III, a value-add real estate investment fundsponsored by ABR, provided an equity commitment of $2.9 million tothe venture. The ABR/Sydney partnership has already purchasedindustrial parks in Indianapolis and Des Moines, IA. With leveragearound 65%, ABR and Sydney expect the portfolio's investmentcapacity to be about $70 million.

|

Asking lease rates in the single-story building, constructed in1990, range from $5.50 to $8 per foot, triple net, depending on theamount of office finish the space contains. The building now haseight tenants, the largest of which is Intertech, a consumerproducts tester which occupies about a third of the building.Burton says he expects occupancy will increase with more attentivemanagement. The previous owner, he says, was an individual whomanaged the property as a side job.

|

"We'll be a better manager; it requires a lot of hands-on work,"Burton says. "The tenants require a lot of attention and if youattend to them well, they tend to stay and renew. You can't buy itand manage it passively."

Want to continue reading?
Become a Free ALM Digital Reader.

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.