Black Creek To Buy 48-Building Prologis Portfolio For $920M
Black Creek Industrial REIT IV Inc. has agreed to buy 48 industrial buildings totaling 8.3M SF from Prologis Targeted U.S. Logistics Fund LP for $902M.
The portfolio, dubbed the Key Logistics Portfolio, sits on 480.7 acres across 13 geographic markets and is 96.4% occupied by 83 tenants. The portfolio has a weighted-average remaining lease term of 3.4 years.
Industrial remains the hottest of all asset classes, reflecting the robust adoption of online shopping by consumers over the past year and the efforts of logistics companies to keep up with demand.
U.S. industrial development spiked in 2020 and is expected to reach a five-year high in 2021. And as demand for e-commerce continues to grow, the industrial sector could face the need for as much as 4B SF of logistics stock in the world's largest logistics markets by 2030.
Black Creek Industrial REIT IV is participating in the sale through an indirect, wholly owned subsidiary firm, BCI IV Portfolio Real Estate Holdco LLC. It will fund the acquisition using proceeds from the company’s public offering and funds from its existing credit facility, according to the SEC filing.
Once the transaction has closed, Black Creek Industrial REIT IV expects that 12 of the 48 buildings, or 4.2M SF, will be placed in one or more Delaware statutory trusts and become a part of the company’s DST program. Under the DST program, the interests in those properties are expected to be owned by a taxable REIT subsidiary and then sold to third-party investors.
Black Creek Industrial REIT IV had $2.2B of assets under management as of March 31, consisting of 134 buildings and 30.8M SF.
The deal follows Ares Management Corp.'s announcement last month that it had agreed to acquire 100% of Black Creek Group’s U.S. real estate investment advisory and distribution business. The deal will bulk up Ares' holdings in the industrial sector. That transaction is expected to close early in the third quarter of 2021.