GlobeSt.com EXCLUSIVE: 2.2M-SF Portfolio Marked for Sale

Jack Fraker, Randy Baird and John Robinson, CB Richard Ellis Inc.'s newest institutional team in Dallas, got the listing that's had brokers whispering for about three weeks. The packets are en route to deep-pocketed investors, mostly pension fund advisers and REITs, with an offering deadline of March 31.

The 25-building portfolio is one of the largest now on the market in Texas, Fraker says. "It will appeal to institutional investors interested in acquiring a critical mass of well-located properties in infill locations," he tells GlobeSt.com. He's predicting upward of 20 offers will be tossed onto the table for the estimated 1.7 million sf in Dallas-Fort Worth and about 500,000 sf in Austin, all situated in newer business parks in leading submarkets.

Emerson Partners isn't selling all that it owns nor is it selling because it must. It's selling because the market is primed to deliver a good return. "Emerson is under no pressure to sell. It's a well-capitalized company," Fraker says.

Emerson started assembling the portfolio in the late 1980s. Now, it's looking to capitalize on a scarce supply of good industrial product up for sale in markets that experts believe have touched bottom in their real estate cycles. "Buying at the bottom of the market cycle has tremendous upside potential," Fraker stresses.

So what's the team marketing? A portfolio that's now 86.7% leased, but with a historical track record of 95% plus; buildings of about 100,000 sf apiece, with 25% to 50% office build-outs; ages from the mid-1980s to about three years old; and the opportunity to buy one, all or part of the package.

The 120 tenants are a mix of sales, health care, government, defense and high-tech industries with a lease rollover of minimal exposure. "The rollover exposure should not be a problem to the buyer," Fraker confides of the no minimum-ask package with a value fattened by a strong NOI throughout the projected hold.