Faropoint sells 109-property industrial portfolio for $481M (updated)

Faropoint announced the sale of a portfolio of 109 institutional-quality, last-mile logistics buildings to a private seller for $481 million July 5.

Altogether, the Hoboken-based company said the properties add up to 6.8 million square feet largely concentrated in Atlanta, Philadelphia, Houston and Memphis.

“This deal marks one of the largest portfolio sales of last-mile urban logistics centers in recent years and positions Faropoint to continue to provide significant value to its investors through its last-mile industrial funds,” said Faropoint Chief Relations Officer Raz Rahamim.

The portfolio is comprised of multi-tenant warehouses and light industrial properties that average 62,000 square feet each. The buildings are 98% leased and occupied by about 200 tenants that run the gamut of local, regional and national enterprises.

The company said it executed 120 leases across the package during its three-year hold period, “significantly increasing NOI and lease commitments.”

In a statement, Faropoint Chief Investment Officer Ohad Porat said the firm is “extremely bullish about last-mile industrial” and optimistic that fundamentals will stay strong in the sector over the long-term due to lack of supply. At the end of the second quarter, the average vacancy rate for the industrial sector in the central and northern parts of the state was 1.8%.

“We will continue to closely monitor market conditions and adjust our strategy as needed in response to macroeconomic trends and future volatility,” Porat added.

According to Faropoint, the sale follows a record-breaking 2021 during which the company acquired 148 buildings across 85 separate transactions. It continued that trajectory into 2022, adding a 140,000-square-foot building in Delanco in April.

“Transacting at such a high volume across nine offices and aggregating data from thousands of deals allows our team to act with much more accuracy and certainty when vetting and underwriting deals,” said Faropoint Chief Executive Officer Adir Levitas. “As the current macroeconomic climate evolves, we will continue to assess market conditions, and are well-capitalized to act when the right opportunities present themselves.”

Eastdil Secured advised Faropoint on the sale and financing of the portfolio; Duval & Stachenfeld LLP served as legal advisor.

Editor’s note: This story was updated at 11:09 a.m. EDT on July 6, 2022, to correct the spelling of Ohad Porat’s name.