REAL ESTATE NEWS

Global Net Lease is expanding its industrial footprint at a time when supply-and-demand dynamics are shifting in favor of landlords, agreeing to acquire Modiv Industrial in an all-stock transaction valued at $535 million.

The New York-based real estate investment trust said the deal, subject to approval by Modiv shareholders, is expected to close by September 30. The acquisition adds a smaller but concentrated industrial portfolio to Global Net Lease's holdings as it continues to reposition away from other property types.

The timing aligns with broader market expectations that industrial fundamentals will tighten in the near term. Demand is projected to overtake supply in the U.S. industrial sector by early 2027, according to CoStar data. The national vacancy rate currently sits at 7.6% and is forecast to peak at 7.8% by the end of 2026, before beginning to compress. That shift could support rent growth across the sector.

Modiv brings 42 properties across 14 states to the transaction, with a heavy concentration in California. While primarily industrial, the portfolio also includes some retail and office assets. The company reported $39.1 million in annual base rent in 2025, according to its latest annual report.

In a statement, Modiv CEO Aaron Halfacre said the company had long viewed its valuation as out of step with underlying asset quality.

"We have long believed that our portfolio's quality was historically mispriced by the marketplace and that we would be receptive if someone sought to close the value gap sooner than we could," Halfacre said.

Halfacre added that the company drew sustained acquisition interest over the past year, including multiple unsolicited offers, but ultimately determined that Global Net Lease offered the strongest long-term fit. He did not name other interested parties.

Modiv's tenant roster is anchored by Lindsay Precast, a concrete manufacturer that accounts for 14.5% of rental income. Like Global Net Lease, Modiv primarily uses net lease structures. Most of Modiv's properties are leased to single tenants.

For Global Net Lease, the deal continues a broader portfolio shift toward industrial assets. The REIT has been actively reducing its exposure to retail. In 2025, it sold 99 retail properties to RCG Venture Holdings for $1.8 billion. As of the end of that year, the company owned 820 properties totaling 41 million square feet across the United States and parts of Europe.

The addition of Modiv's portfolio deepens its presence in logistics-oriented real estate at a time when supply pipelines are expected to moderate and leasing fundamentals are expected to improve.

Source: GlobeSt/ALM