Home Featured Canadian-Based REIT, Granite, Buys $232.5M Portfolio Near Columbus, OH

Canadian-Based REIT, Granite, Buys $232.5M Portfolio Near Columbus, OH

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Granite, a Canadian-based REIT engaged in the acquisition, development, ownership and management of predominantly industrial, warehouse and logistics properties in North America and Europe, recently revealed that it has acquired a portfolio of four class A, single tenanted buildings totaling approximately 3.8 million square feet on 78 acres of land near Columbus, OH. The purchase price was $232.50 million, representing an in-going stabilized yield of approximately 6%.

Granite owns over 85 rental income properties representing approximately 30 million square feet of leasable area. Through the thoughtful deployment of its balance sheet and selective dispositions, Granite is continuing to build a high quality, globally diversified industrial real estate business.

Michael Forsayeth, Granite’s CEO, commented that “This acquisition will be immediately accretive to funds from operations and adjusted funds from operations and is another strategic milestone in Granite’s transformation from a largely single tenanted REIT to a broadly tenanted, globally diversified industrial real estate business. As a result of this acquisition and initiatives announced earlier in the year, significant progress has been made towards Granite’s strategic priorities including a reduction in Magna concentration from 61% at the beginning of the year to 52% as measured by gross leasable area. Also, on a run rate basis, Granite will have made substantial progress towards replacing the cash flow from the 10 properties sold earlier in the year.”

The properties are located in West Jefferson which is approximately 20 miles west of Columbus. Key highlights of the Acquisition include:

  • Located in the greater Columbus industrial market, which has emerged as a major distribution corridor in the United States due to its central location, excellent interstate highway system and strong labour base;
  • A diverse tenant base comprised of large public and global private entities;
  • The buildings are modern e-commerce distribution facilities with an average age of approximately 7 years;
  • Tenants in two of the buildings have expansion options of at least 200,000 square feet;
  • The buildings are single tenanted and are currently 100% occupied; and
  • While one of the tenants is currently in liquidation and may vacate the building 743,600 square foot building, Granite believes the re-leasing prospects for this building are strong.
  • The Acquisition is subject to customary closing conditions and closing is anticipated to take place later in May 2018. Granite expects to fund the purchase through a combination of cash on hand, largely from the proceeds of the dispositions that occurred in January 2018, and a drawdown of its unsecured credit facility.