Peakstone Realty Trust—a real estate investment trust focused on owning and operating industrial assets—announced that it has acquired a portfolio of 51 industrial outdoor storage (IOS) properties from a joint venture between Alterra IOS and institutional investors advised by J.P. Morgan Asset Management in an off-market transaction valued at $490 million. This acquisition was funded by a combination of proceeds from the company’s credit facility and cash on hand.
This 51-property infill portfolio comprises 45 operating assets and six redevelopment sites. These assets span 440 usable acres across 14 states and are strategically located near major supply chains and population centers. This operating portfolio has a WALT of 4.5 years1 and is approximately 100% leased2 to diversified, high-quality, primarily national and regional tenants.
With this acquisition, Peakstone has expanded its industrial footprint and established a significant presence in this emerging, high-growth sector. Favorable operating dynamics, significant supply constraints, and minimal capital expenditure requirements characterize industrial outdoor storage. And the company has significantly enhanced its long-term growth profile with a potential 70% mark-to-market opportunity3 on the IOS operating assets and the ability to achieve incremental yield through six redevelopment sites.
BofA Securities worked as Peakstone’s exclusive financial advisor. O’Melveny & Myers, Latham & Watkins, and DLA Piper worked as Peakstone’s legal counsel.
KEY QUOTES:
“We are pleased to announce our entry into the industrial outdoor storage sector. This portfolio is highly complementary to our existing industrial business, and adds meaningful scale, breadth and growth opportunities in a sector with compelling operating fundamentals. We expect that favorable market trends will persist in the IOS sector, and will drive long-term value for shareholders. Looking forward, we are committed to shifting our portfolio more towards industrial, and we will be strategic about balancing industrial investments while reducing leverage.”
- Michael Escalante, CEO of Peakstone
“Peakstone’s acquisition of this high-quality portfolio advances the institutionalization of the IOS asset class. We believe this transaction is a win-win, and that Peakstone is the right owner to build upon the success of these assets and drive further value.”
- Leo Addimando, CEO and Managing Partner of Alterra and Matt Pfeiffer, CIO and Managing Partner of Alterra
“This portfolio transaction represents an important milestone in the execution of one of our highest conviction strategies.”
- Preston Meyer, Managing Director and Portfolio Manager at J.P. Morgan Asset Management
