CEDAR RAPIDS, IA-A private investment group from Sherman Oaks, CA, designated as Oat Pep LLC, has purchased a one-million-sf industrial building, fully leased by PepsiCo subsidiary Quaker Sales & Distribution Co., for $36.6 million. The property was purchased from Worley Land Co. LLC at a cap rate of 6.3%.
The building is used as a warehouse. Quaker signed a fresh 15-year lease for the site recently, says Brent Avis, an associate with Lee & Associates' Sherman Oaks office. He and John Battle, principal, arranged the sale.
Avis says Pepsi, which had used the building since it opened in 1999, had been looking at a couple options in the area. "They needed more space, and they put out an RFP to developers, they needed one million sf. They were shown various sites, proposals, different rent structures, etc. The best option that came out of it was staying in the existing facility," Avis tells GlobeSt.com.
He says the developers partnered with the landowner, Worley, to expand the facility by more than 200,000 sf. The project is almost complete, and should be finished by November, Avis says. The lease rate for the building is $5.12 per sf.
The investment group now has bought the building from the developer/Worley partnership. "The buyers really like the quality of the tenant. It's a decent market, though a building this size really defines the market. It's so close to a major Pepsi bottling facility, the company isn't going anywhere," Avis says.
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