$10M Costex Deal Highlights Financing Opportunities

MIAMI-In the largest user acquisition in recent years, Costex Corp. has invested $10.3 million to purchase an industrial property. The supplier of new replacement parts for the heavy equipment industry needed a new building to handle its growing clientele.

Costex recently acquired the 180,000-square-foot industrial property at 7901–8187 NW 71st St. in Miami from Seagis Property Group, an industrial investment firm based in West Conshohocken, PA. CB Richard Ellis vice presidents Devin White and David Albert, along with associate Ronald Marrero, represented Costex. Jim Armstrong and Michael Waite of the Easton Group represented the seller.

“Hopefully this private user getting financed is a sign of things to come with the banks as we are coming out of this depression we’ve been in,” White tells GlobeSt.com. “The markets are a little wishy washy but I think that lends itself more to lending on hard assets as opposed to paper.”

A single-story industrial building, Costex’s home was built in 1980. The asset sits on 11.04 acres just off the Palmetto Expressway. Costex will share the building with a tenant that takes up about 55,000 square feet. As the building’s new owner, Costex has positioned itself for further growth while generating revenue on the asset.

Michael A. Gil, the attorney who represented Costex in the transaction notes the significance of a user obtaining conventional financing in contrast to the typical ‘all-cash’ investor. “Despite a difficult financing environment, we were able to work closely with the bank in order to complete the deal,” Gil said in a statement. “This deal hopefully represents a turning of the corner for the lending market.”

White highlights that class A product in the Dade County market is under 5% vacancy, and vacancies in tertiary markets is dipping below 10%. When that happens, he predicts, rates are going to go up even more.

“Some are saying rental rates will rise another 20% or 30% over the next six to 12 months and they’ve already gone up 25% since the beginning of the year,” White says. “Going to mid-sixes to mid-nines is significant.”