A Texas real estate investment firm and an undisclosed capital partner teamed up to acquire an 18-building industrial park in Somerset County, located in the state’s high-demand Interstate 287 submarket.
Lovett Industrial announced its acquisition of Middlebrook Crossroads on May 3. The property at the corner of Chimney Rock Road in Bridgewater is comprised of 580,277 square feet situated on nearly 39 acres. That same day, Terreno Realty Corp. announced its sale of the property for approximately $110.4 million.
A Cushman & Wakefield team led by Gary Gabriel, Kyle Schmitt, David Bernhaut and Ryan Larken served as broker for the transaction.
Terreno said it purchased the property in September of 2010 for approximately $27 million when it was 76% leased to 20 tenants; making for an unleveraged internal rate of return of 15.2% generated by the investment.
Middlebrook Crossroads is an 18-building industrial complex situated on nearly 39 acres in Bridgewater. – BUSINESS WIRE
“We’re thrilled for this acquisition to lead off our latest investment program focused on core acquisitions of assets providing stable cash flow and rent growth potential,” East Region Senior Managing Director Michael Allen said in a statement.
Middlebrook Crosswords has been at near-full occupancy for a number of years, according to the buyer. It is currently leased to 28 tenants, including UPS, Lexus, SCP Distributors and Hoop Heaven. The average building size is approximately 32,000 square feet, with spaces for tenants ranging from 5,000 square feet to 50,000 square feet.
“The Middlebrook portfolio represents an opportunity to acquire a unique industrial asset at a significant discount to replacement cost with material rental rate upside in one of the most sought-after submarkets in the United States,” Allen said. “We will continue to target more opportunities in this region that exhibit similar qualities.”
Houston-based Lovett also has offices in Dallas, Washington, D.C., and El Segundo, Calif. This transaction marks the third the company has made in the Northeast, and, it said, its first stabilized property acquisition in the region.
Access to and from Middlebrook Crossroads is abundant, with a location between Route 22 and Interstate 287 that offers immediate proximity to Interstate 78, Routes 202/206 and 28, and the New Jersey Turnpike. According to Lovett Industrial, the location provides access to 1.2 million consumers within 15 miles; that number jumps to more than 8 million within an hour drive.
