"This transaction is an excellent value-creation opportunity," according to John B. Begier, EVP and chief investment officer for Keystone. "We have acquired a quality building at a discount to replacement cost in a market where there is both limited ground for future development and stable demand generated by its close proximity to New York City."
The buy marks the second acquisition in this market in the last four weeks by Keystone and CalEast (the latter is comprised of LaSalle Investment Management and CalPERS). Last month, the venture snapped up the 143,530-sf distribution center at 1275 Valley Brook Ave. in nearby Lyndhurst, NJ for $8.4 million. A joint venture of Morgan Stanley and The Gale Co., represented by the Tri-State Investment Team of CB Richard Ellis was the seller in the earlier transaction.
The Keystone/CalEast venture expects to invest a total of $300 million and is targeting properties in the eastern states. Keystone's portfolio encompasses 23 million sf, all but two million sf of it involving industrial properties. Some 15 million sf is located in the firm's core markets of New Jersey, Pennsylvania and Indianapolis.
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