CHICAGO-Volkswagen of America and Volkswagen of Canada have signed sale-leaseback transactions for three distribution centers, located near the Chicago, Dallas and Toronto markets. Locally based First Industrial Realty Trust has purchased the 977,686-sf portfolio, and will lease the properties back to the automaker for a 15-year term.
The industrial REIT bought Volkswagen's 264,907-sf property at 11589 88th Ave., Pleasant Prairie, WI; the 369,530-sf center at 120 Intermodal Parkway, Haslett, TX; and a 343,249-sf property at 777 Bayly Street West, Ajax, Ontario, a suburb ofToronto, Canada.
Larry Emmons, regional director of the REIT's Detroit region, and Robert Micera, senior vice president and national head of net lease investments, led the trust's team on the deal. The duo tells GlobeSt.com that the REIT's Single Tenant Co-Investment Program Fund was used to buy the sites. "These are strategically-important assets with long-term leases in areas with good fundamentals of real estate. The portfolio is suitable for a long-term hold," Emmons says.
The two would not divulge the purchase price of the properties. The average asking sales price in the Southeast Wisconsin market is $46.91 per sf, or about $12.4 million for a property the size of the Pleasant Prairie center. The average lease rate for that area is $4.61 per sf.
Johannson Yap, chief investment officer with First Industrial, says the deal will help Volkswagen use the sale proceeds for reinvestment, while also being able to continue the use of mission-critical distribution centers. Ronald Gantner, senior vice president of Trammell Crow Co. and Erica Holton, associate, assisted in the transaction.
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