Arden Logistics Parks Secures $99.1 Million in Refinancing for Multi-Tenant Industrial Portfolio
Arden Logistics Parks has successfully secured a $99.1 million floating-rate loan, refinancing a strategic portfolio of five multi-tenant industrial parks across three states. This significant funding, provided by an Ares Management Real Estate fund, encompasses a total of 11 buildings covering over 765,000 square feet.
Details of the Refinanced Portfolio
The refinanced properties, located in prime markets in Florida, Illinois, and North Carolina, were acquired in multiple transactions from 2023 to 2024. While specific locations and sizes were not disclosed by Arden Logistics or JLL Capital Markets, the assets are known to be situated in high-barrier-to-entry regions, providing favorable investment conditions.
Portfolio Highlights
- Asset Composition: The portfolio includes multi-tenant shallow-bay buildings and a single-tenant industrial service facility.
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Specifications:
- Clear heights range from 14 to 24 feet.
- Features both dock-high and drive-in loading positions.
- Ample parking available to support tenant operations.
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Strategic Locations: Properties are strategically positioned near transport hubs, including major international airports and key interstate highways, ensuring excellent access for last-mile distribution and regional logistics.
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Occupancy: Currently, the portfolio boasts an occupancy rate of 84.4%, with tenants spanning industries such as:
[link-whisper-related-posts]- Healthcare Manufacturing
- Technology
- Automotive
- Professional Services
- Potential for Rent Growth: The portfolio exhibits a 10.5% mark-to-market opportunity on in-place rents, positioning Arden to capture potential rent increases in supply-constrained submarkets.
Sustained Demand in the Industrial Sector
The industrial sector continues to experience strong demand for infill and last-mile distribution facilities, driven by:
- Low Vacancy Rates: Vacancy rates remain well below national averages, indicating strong tenant demand.
- Limited New Supply: Construction activity for smaller multi-tenant industrial assets accounts for just 0.7% of the total inventory under construction, exacerbating the supply issue.
Why Shallow-Bay Assets?
Investors are increasingly drawn to shallow-bay infill sites for several reasons:
- Diverse Tenant Mix: These properties cater to a wide-range of businesses, enhancing resilience to market fluctuations.
- Frequent Rent Adjustments: Shorter lease structures allow for more frequent adjustments, providing protection against inflation.
Arden Group’s Growing Portfolio
Since its launch in November 2021, Arden Logistics Parks has rapidly expanded its portfolio:
- Current Holdings: Includes 11 million square feet across 15 markets, featuring locations such as:
- Atlanta
- Boston
- Dallas
- Houston
- Indianapolis
- Philadelphia
- Chicago
- Charlotte, N.C.
- Tampa, Fla.
Recent Acquisitions
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Addison, Illinois: In December 2023, Arden acquired a 34,700-square-foot industrial service facility leased to UPS, enhancing its presence in the Chicago industrial market.
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Houston, Texas: Stream Realty Partners was appointed to lease North Park 34, an 865,000-square-foot industrial park, which was previously acquired for under $80 million.
- West Palm Beach, Florida: The firm also entered this market through the purchase of a three-building, 195,532-square-foot portfolio, hosting over 40 tenants.
Conclusion
Arden Logistics Parks’ recent refinancing underscores its commitment to expanding its footprint in high-demand industrial markets. With strategic investments and a focus on enhancing existing assets, the firm is well-positioned to capitalize on the growing demand for industrial properties in the U.S. As the market evolves, Arden’s strategy of diversifying its tenant base and leveraging location advantages will likely prove beneficial for long-term growth.
The industrial sector remains ever-relevant, making this an exciting time for Arden Logistics Parks and its stakeholders.