Challenge

With a robust portfolio across multiple locations including the metro areas of Chicago, Dallas, Los Angeles, Denver and Baltimore-Washington, D.C., Cabot was facing the proposition of selling 146 properties covering roughly 22 million square feet of valuable industrial spaces which are in ever increasing demand.

Approach

Goodwin assembled an experienced cross-office team from its renowned Real Estate Industry group to advise Cabot on the sale of the portfolio, which was structured as a sale of interests in entities owning the portfolio rather than as a sale of the real property.  The sale of interests included the sale of 100% of the common shares of a real estate investment trust.

Outcome

Upon closing in March 2018, Cabot Industrial Value Fund IV LP and Cabot Industrial Value Fund IV Manager LP sold a 22-million-square-foot portfolio to Blackstone. Tenants at the properties include Amazon.com Inc., FedEx Corp., DHL International GmbH, the U.S. government, The Coca-Cola Co. and Fiat Chrysler Automobiles NV. The properties in the Los Angeles area are 100 percent leased, as are the Denver and New Jersey properties. “The continued market rent growth in the portfolio’s markets resulted in rents on new leases exceeding rents on expiring leases by 9% in the portfolio during the third quarter of 2017,” according to Blackstone officials reported. “The company believes the portfolio will further benefit from these attractive fundamentals as the portfolio is currently only 90% leased versus average occupancy in the portfolio’s markets of 95%.”