CAPRE’s Commercial Real Estate Headlines for January 2, 2020

Check out the latest deals and developments in commercial real estate for January 2, 2020:

  • Kennedy Wilson Raises $775 Million for Sixth U.S. Real Estate Fund: Kennedy Wilson (NYSE:KW) announced today that it has exceeded its target, securing $775 million of capital commitments and closed fundraising for Kennedy Wilson Real Estate Fund VI (“Fund VI”), a private equity fund focused on value-add real estate investments across the Western U.S. with purchasing power of approximately $2 billion in commercial assets. The fund is the largest private placement in the company’s 31-year history and is 55% larger than its predecessor fund, which closed in 2016. The Kennedy Wilson team secured capital commitments from a diverse, global institutional investor base, including private wealth management offices, public and corporate pension funds, and family offices. Kennedy Wilson committed $82 million to the fund.
  • Skanska invests $221 Million in Multi-Family Development Project in Tysons, VA: Skanska is investing $221 Million USD in The Heming, a new multi-family development in Tysons, VA. The construction contract is worth about $150 million which will be included in the US order bookings for the fourth quarter 2019. Skanska USA will develop and build The Heming, 28-story, 410-unit luxury apartment building. The development includes 3,500 square meters of ground-floor restaurant and retail space and is targeting LEED Gold certification. The Heming is a part of Scott’s Run, an about 600,000 square meter mixed-use development and will be located across the street from Metro’s McLean Silver Line station.  Skanska will begin construction in January 2020 and the project is scheduled to be completed in fourth quarter of 2022. Skanska’s other real estate developments in the greater Washington area include the office building the office building 99M, 2112 Penn; the luxury apartment building RESA; the office building 1776 Wilson Blvd and the office building 733 10th and G. Skanska’s recent land acquisitions include a site at Scott’s Run to develop a multi-family project in Tysons, VA, and 1700 M, a mixed-use development.
  • Terreno Realty Corporation Sells Building in Annapolis Junction, MD for $15 Million USD: Terreno Realty Corporation has sold an industrial property located in Annapolis Junction, Maryland on December 24, 2019 for a sale price of approximately $15 Million USD. The property consists of one industrial R&D building containing approximately 97,000 square feet on 6.3 acres at 9020 Junction Drive. The property was purchased by Terreno Realty Corporation November 17, 2014 for approximately $13.8 Million USD. The estimated unleveraged internal rate of return generated by the investment was approximately 7.6%. Terreno Realty Corporation acquires, owns and operates industrial real estate in six major coastal U.S. markets: Los Angeles, Northern New Jersey/New York City, San Francisco Bay Area, Seattle, Miami, and Washington, D.C.
  • Gladstone Buys Industrial Property in Carrollton, GA for $8 Million USD: Gladstone Commercial Corporation has completed the acquisition of a 117,000 square foot industrial building in Carrollton, Georgia on December 17, 2019, for $8 Million USD. The initial capitalization rate for the acquisition was 6.6%, with an average capitalization rate of 7.4%. The property, acquired in a sale/leaseback transaction, is 100% leased to Superior Recreation Products and guaranteed by PlayCore with a twelve year lease term. Superior Recreation Products utilizes the property to assemble and distribute its industry leading recreation and shade products. The property was newly constructed in 2019. The acquisition of the industrial property is consistent with Gladstone Commercial’s growth strategy of acquiring high-quality assets in growth regions with credit-worthy tenants.
  • Cannabis REIT to Invest $37.3 Million USD in Two Grassroots Sale/Leasebacks: Innovative Industrial Properties,  the first and only real estate company on the New York Stock Exchange (NYSE: IIPR) focused on the regulated U.S. cannabis industry, has closed on two sale-leaseback transactions with subsidiaries of GR Companies Inc. (Grassroots) for two properties in Pennsylvania and North Dakota, which comprise approximately 105,000 square feet of industrial space in the aggregate. The purchase prices for the properties were approximately $24.1 Million USD in total (excluding transaction costs). Concurrent with the closings of the purchases, IIP entered into a long-term, triple-net lease agreement for each property with a subsidiary of Grassroots, which intends to continue to operate the properties as regulated cannabis cultivation and processing facilities.