Dalfen Industrial is expanding its partnership with Goldman Sachs' asset management unit to purchase 21 last-mile industrial buildings that are scattered across multiple markets in the U.S.
The locations of the portfolio include Las Vegas, Cincinnati, Dallas, and Pennsylvania. In total, the off-market acquisition spans 2.1 million square feet. The assets consist of 68 tenants and are 92 percent leased.
Dalfen, which is based in Dallas, has offices in Philadelphia and Cincinnati. It believes its regional presence will help contribute to strong operating performance for the portfolio. The exact cost of the acquisition was unclear.
“Dalfen Industrial is excited about adding exceptional assets in strong submarkets with substantial barriers to entry," Sean Dalfen, president and CEO of the company, said in a statement.
"The portfolio features a diversified rent roll across modern, well-located buildings in markets we know intimately. Acquired at well below replacement cost, we see significant potential to enhance value through strategic improvements and capturing upside as below-market leases roll over.”
Another important element the two investors cited was building on its partnership which includes targeting markets with favorable supply chains, onshoring, e-commerce growth, and labor trends. The acquisition takes Goldman and Dalfen's management in industrial assets together to 19 million square feet and 94 buildings. The duo's past work together includes Goldman's banking division buying a $500 million stake in Dalfen's 46-asset last-mile industrial portfolio in 2020. Also, during that year, the two teamed up to buy 10 last-mile properties in Denver, West Palm Beach, Charlotte, San Antonio, and Fort Worth.
A December Yardi Matrix industrial report found that national rents rose 6.9 percent year-over-year to an average of $8.27 per square foot. Miami saw the biggest growth, with rents hitting $12.11 per square foot, representing an 11.1 percent increase. Meanwhile, Midwest regions saw slower rent growth rates. St. Louis and Kansas City, for example, only experienced 2.7 percent and 3.2 percent gains respectively.
Source: GlobeSt/ALM