Asking Price Contact for pricing
NOI Net Operating Income
Cap Rate N/A
Asking Price Contact for pricing
NOI Net Operating Income
Cap Rate N/A

Documents

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Attributes

Building Area
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Property Description

50,000 square foot industrial facility located in Avon, Massachusetts. The Property is 100% leased to a single tenant, Road Safe Traffic Systems, the nation’s largest provider of traffic control and pavement marking services and a portfolio company of Investcorp and Trilantic Partners. Located off of Exit 35 on Route 24 at the entrance to the Avon Industrial Park; the Asset has unbeatable access to Interstate 93, 95, and 495. The 3.2 million square-foot industrial park is one of only a few inside I-495 and demands average asking rents north of $12 per-square foot.

Investment Highlights

TOP-NOTCH MARKET FUNDAMENTALS

The Metro South industrial market is by far Greater Boston’s largest and most robust industrial submarket at 74.5 million square feet. It offers the deepest bench of warehouse and distribution talent and features the longest list of blue-chip tenants who call the submarket home. As of the end of the first quarter in 2021, vacancy rates have reached the lowest levels seen since 1999 at 5.1%. This has put immense upward pressure on rental rates which climbed over 5% year-over-year and 37% over the last five years. The Metro South submarket is buoyed by a strong roster of existing warehouse and distribution users including FedEx, Best Buy and Wayfair, while in Avon alone there are household names such as Lineage Logistics, Whirlpool, Waste Management, XPO Logistics and Sunbelt Rentals. These companies have found a deep pool of manufacturing and engineering talent that they can pull from in the surrounding area. The asset is in a rock-solid position of being in a well-established industrial park adjacent to major highway access with limited nearby development providing a wide moat of security against potential competition.

 

 

SHORT-TERM INCOME WITH LONG-TERM UPSIDE

With just 3.3 years left of term, new ownership has the perfect opportunity to bring rents to market upon lease expiration in September 2024. Over the last seven years, rents have increased on average 7.5% year-over-year with no sign of abating. Warehouse and Distribution rent increases are driven by severe demand and supply imbalance which isn’t expected to slow down in the short to medium term. This allows new ownership the ability to get to the rolling lease in a relatively short timeframe and mark rents to market with the existing or new tenant. Simultaneously, Road Safe, a tenant for over 20 years, will be providing safe and durable income for the first three years of ownership, mitigating any immediate risk with the property.

 

 

HIGHLY SOUGHT-AFTER HIGH BAY WAREHOUSE

The Asset has been fitted with 30’+ clear heights, a true rarity for industrial product within the 495 loop. There is over 130 million square feet of existing industrial product within I-495, and only 16 million square feet has 30’+ clear heights, or 12%. This is despite high-bay clear heights being the number one focus for most warehouse and distribution tenants in the market, creating a natural high tenant desirability should the Asset need to get re-leased. The lack of supply of 30’+ clear heights within I-495 is unlikely to change for years to come, as almost all future development is slated for parcels outside the loop.

Last Updated Date: 24 May 2021
Lenny Pierce
Lenny Pierce
Director, Capital Markets
License details
MA-9535848
Michael Restivo
Michael Restivo
Senior Director, Capital Markets
License details
MA-9560857

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Last Updated Date: 24 May 2021

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