JV Sells CT Property for Record Price

The complex at 780 James P. Casey Rd. was formerly a General Motors manufacturing plant and sits on 182 acres. The Savanna/Hudson Realty Capital joint venture doubled the price it paid for the property just over a year ago, company officials say. Jeffrey Fishman and Ariel Schuster of Robert K. Futterman & Associates of New York City brokered the transaction.

"Our successful leasing strategy was able to dramatically increase the value of this asset in a relatively short period of time," says Shep Wainwright, a principal of Savanna Investment. "We saw an opportunity to acquire a property that could produce significant return on investment in a short time via an aggressive redevelopment and leasing strategy. Even in a tumultuous market, this value-added strategy has produced an outstanding return for our investors."

Three of the property's main tenants--Firestone Building Products Co., Arett Sales and Clark Steel--have signed new lease commitments that have terms of for more than 10 years. Firestone occupies 401,000 sf; Arett Sales has 340,000 sf; and Clark Steel has a presence at the property totaling 250,000 sf. The building was empty in the mid-1990s after General Motors shut down its ball-bearing manufacturing operation at the property.

"Since acquiring the building, we signed over 350,000 sf of new leases and extended over 600,000 sf of existing leases for an additional 10 years of term," Wainwright adds. "In order to accommodate Clark Steel's and other tenants' uses, we raised 250,000 sf of roof from 16-foot clear to 28-foot clear, re-roofed over 700,000 sf, brought a rail spur across the parking lot into the building and fully renovated 350,000 sf of space. We transformed a 60% occupied building in disrepair with minimal lease term remaining into a 94% occupied fully stabilized industrial complex."

Fishman of Robert K. Futterman says of the deal, "it was an opportunity to purchase an industrial/warehouse/distribution facility for $50 a sf with rents at approximately 20% below market with the capacity to add another 200,000 sf." North Fork Bank provided a total of $45 million in first mortgage financing in connection with the purchase, he adds.

Fishman notes that in additional to its 28-foot ceiling heights, another attractive feature of the property is the two rail spurs that connect directly with the Firestone and Clark Steel space.