Real estate investor Faropoint has picked up four industrial properties in the Dallas area totaling more than 300K SF.

The acquisition includes two properties in Farmers Branch, one in Carrollton and another in Garland. It was an all-cash deal, which was advantageous to the seller, according to Chad Albert, founder and managing principal at Stoic Real Estate Partners, which brokered the deal for the buyer and seller. The total price wasn't disclosed.

“They source the financing after they’ve closed the transaction,” he said. “It makes them an attractive buyer in this market. They’re not subject to appraisals or lender scrutiny.”

The Class-B buildings were all built in the 1970s, Albert said. In a bid to remain competitive and drive rental rates, Faropoint plans to invest in renovations once leases turn over.

“The goal is to keep up with the area,” Albert said. “There’s a lot of buildings over there getting major improvement dollars being put into them.”

A property on Kings Road, the largest of the four at 154K SF, will become vacant in a couple of months after Amazon, the building’s sole tenant, moves out. Albert said his team is already in talks with two tenants to take over the space.

“They had confidence they would lease this building on Kings pretty quickly,” Albert said. “They weren’t scared to take on a little vacancy risk.”

The rest of the portfolio is fully leased, Albert said.

The deal took about four months to finalize and was subject to swiftly rising interest rates that made closing the sale difficult, he said.

The seller eventually came down on the price, which Albert said is happening more often as the reality of the market sets in.

“We’re starting to see the disparity between bid and ask shrink a little bit,” he said. “But there is still just not a lot of supply on the market for sale, and the big reason for that is even though sellers are now more realistic on what their properties are worth, a lot of them are still saying, ‘Now’s not a good time to sell.’”

That could change as industrial owners with loans coming due balk at the prospect of refinancing at a much higher interest rate, Albert said. For the most part, the market’s low vacancy rates and strong demand are poised to protect industrial from the wave of distress threatening other asset types.

“We are still seeing transactions happen,” he said. “Have interest rates made things harder? Absolutely. But there are still buyers out there, and there are still folks willing to sell their buildings.”